6. Smart Contracts and DApps

MIT 15.S12 Blockchain and Money, Fall 2018
Instructor: Prof. Gary Gensler, Prof. Lawrence Lessig
View the complete course: ocw.mit.edu/15-S12F18
KZbin Playlist: • MIT 15.S12 Blockchain ...
This session covers smart contracts, blockchain design, DApps, and tokens. Harvard professor Lawrence Lessig explains the legal issues of smart contracts.
License: Creative Commons BY-NC-SA
More information at ocw.mit.edu/terms
More courses at ocw.mit.edu

[@mrw8643]

Am I really getting a FREE online MIT course from the Gary Gensler on Blockchain and Bitcoin!?!? Wow. Yes, yes I am. Super grateful.

[@francopasqualini5363]

yea, isn't youtube amazing?

[@tuff2luhv558]

same

[@asht7290]

@@francopasqualini5363 yup, KZbin is great, but this is a tremendous generous "open-educational" decision by MIT Sloan

[@knee-long1255]

No kidding. I'm soooo grateful to be able to learn about amazing technology from MIT for "free". YT is utilizing the most beneficial sort of projection for this technology of the future.

[@indobalkanizer6557]

Proud to be a KZbin Premium user, now I'm totally convinced that YT is super worth it 💯

[@onceappuonatime]

Thanks a lot to everyone at MIT for providing such valuable information to the public. In the true sense of our internet, this is one reason why it was created.

[@rodrigodiaz1321]

Best way to thank is to donate to them

[@marcastro8052]

MIT is overrated. I make more money than an average MIT graduate.

[@ricardo190988]

Education should be all free or much cheaper tbh, especially now where thanks the the internet, like you said, we don't require huge investments in infrastructure and everyone can just learn at home.

[@MrBorussia22]

Starts off with the true sense of our internet and then forgets about TikTok... Disappointing @Neeraj Nair.

[@ReTr093]

@@marcastro8052 probably because a ton of MIT graduates end up working in research, which isn't known for being the highest paying field around, although it is known for being the primary field in the creation and validation of general human knowledge. so you might be earning more than your average MIT grad, but ask yourself whether you are you contributing to humanity and society as much as your average MIT grad does?

[@thejamesinator17]

Legend has it, the girl in the front is still raising her hand to this day.

[@todayu]

It’s killing me!

[@manojvits]

LOL

[@ethanrojas2270]

😂

[@balmaceda01]

False,she was medically assisted to local clinic due to sustained ligature strain

[@Dabu-Dabu]

I still can't believe all this material is for free.... this is beyond me. and I love it.

[@jlbdgb]

Same great content ,dgb long

[@ghaffarellis]

I'm forever thankful. I'm a Jamaican college dropout would take the time to educate himself regardless of circumstance. And, here I am applying myself to a MIT Programmed Course.

[@artofexistance]

Keep it up

[@trader9926]

Don’t give up

[@jvanrs4928]

What a fantastic class. I have done my studies in pretty decent places ; however, the breath, depth, and carisma of Mr. Gensler is top notch

[@matteoperetti9535]

This content is an example og why internet is so good

[@GreyArea619]

I can't believe this is open to the public!

[@minichanz]

It's hard to believe so little people appreciate it yet.

[@minichanz]

This will have more hits than Psy

[@Estado_Alterado]

Crazy right?!

[@nrg_fre]

It should be, Transparent The Land of The Free & Trust Isn't Free Anymore American Government WASTE$$$$$ DIGITAL BLOCKCHAIN LEDGER WILL KEEP EVERYONE MORE HONEST AND INCENTIVE TO. WHICH CHANGES THE WORLD 🌎PEACE

[@jackseropian4905]

I just found like three days ago and just been binge watching it, he’s an amazing professor guess that’s why it’s MIT lol

[@kevinrodriguez-ju6ij]

I feel like im attending to MIT for free, thank you guys so much for posting the video , this was so interesting , a world of knowledge and i also learn that i have to take a coding course lol

[@djienf]

Hmm, is this whole semester free? Count me in. Thank you MIT, my favorite college.

[@rp3875]

Extremely valuable course with such high quality. Cannot thank MIT enough!

[@MoneyOverFame]

Absolutely

[@djienf]

Yeah

[@justins1147]

Anyone who cares about the future of the "money" needs to see this. Thank you MIT. Watched it twice already.

[@gs2988]

These are really super interesting lectures. Appreciate them being available and accessible to us.

[@berajpatel8081]

Thank you Prof. Gary Gensler & Prof. Lawrence Lessig

[@shennindar7761]

this lecture is gold dust. learned so much, brilliant delivery by both lecturers

[@goksuokar288]

These lectures are so precious, thank you MIT! For enabling us to be a part of it.

[@gabrielsodre1897]

Thank you for making knowledge accessible to almost anyone. Greetings from Brazil.

[@MOBoperations]

Brilliant lecturers with highly valuable knowledge. Thank you MIT.

[@MP-ny3ep]

Wow , to be able to be a part of the discussion which includes the greats like Gensler and Lessig (even though it's prerecorded) is an honor. Thank you once again MIT for your invaluable service and thank you Prof.Gensler and Mr.Lessig for this wonderful lecture

[@alexalston3240]

The course has it its stride for sure! Guest lecturer was a good idea gary! "force Lessig to pay the 10K!"

[@acmtsing]

Professor Gary Gensler is really good at teaching.

[@ameremortal]

I'm so thankful for these. I love MIT people.

[@campusseoul]

It was good to have Lawrence Lessig cover the legal issues of smart contracts.

[@rschmidtzalles]

So far my favorite lecture of this course.

[@rohitnair9304]

What an absolute masterclass of a lecture! You can see Prof Lesson has thought deeply on this topic. Glad to be able to listen to him here sitting in PJs.

[@kevincoutinho8726]

A lot of the focus here was on the interpretation of the contract and mentioning that the "state" will intervene. Would have loved to hear more on how the "Consensus Mechanism" fits in with the interpretation of the contract and how DApps could be used to let the people have a say in the decision making process.

[@heyjonbray]

If you're interested in this still, I'd recommend checking out some materials on specific DAOs and how their governance structures work. The Ethereum VM's consensus mechanism provides rules that apply to the entire platform, while contractual consensus can be performed on a dapp basis. MakerDAO (the governance mechanism for Compound Finance) is one of the longest running and most financially liquid DAOs on Ethereum and is a good starting place for application specific governance and decentralized consensus.

[@barrellcooper6490]

Best class so far.

[@philipnovikov2413]

What a class... Especially in today's bull markets...

[@chrisbecker5472]

Me too just discovered this channel. Thankyou to all involved. MIT wow, im in Australia lol. Feel very humbled. I will shut up now and listen.

[@manojvits]

THANK YOU !!! Great Lecture, makes you aware of some really complex problems and ends on optimism. Thank you

[@luthianotrarbach3145]

This course is awesome! Thank you, MIT for the excellent resource.

[@mauricem5232]

Thanks for a decentralized lecture! Watching from Rwanda

[@WGchamara]

Thank you MIT & prof. Gary Gensler.

[@bobsondugnutt7526]

1:06:20 The key here is that the code is open source, meaning anyone can view it. You don't have to understand the code, you only have to trust a consensus of code-readers that the code is in good faith.

[@elginbeloy6205]

Bruh this is not failsafe. Look at Linux kernel bugs that have been there for TEN YEARS! And U of M researches adding new bugs to the kernel with literally no reviewer saying shit for years.

[@julkiewicz]

@@elginbeloy6205 Worse yet, there is no recourse against badly written smart contract, as I understand. That's where the legal system's ambiguity and vagueness comes in handy. I could sign a complicated contract with a loophole allowing the other party to get my house for free. But then I could go to court and make a case that this contract was not adequately expressing the consensual will of both of the parties (namely, me). And there's a good chance I would win and render that contract or some clauses in the contract void. There is no analogue for that in smart contracts. That's why I view them as tools for professionals - financial institutions, traders, investors, not ordinary people.

[@arthurswanson3285]

@@elginbeloy6205 lol

[@apexvadeor3670]

@@elginbeloy6205 AI will fix all code bug and errors

[@autumnmarlene]

Thank you MIT from myself and the future

[@lorenzotijerina238]

I love this so much. Im beyond grateful.

[@samforeman3137]

alot of smart contracts systems and cryptos out there but I feel like Lessig is explaining Cardano perfectly.

[@Infinitenothingness180]

high quality stuff.. Thank you MIT !

[@84raizen84]

From Italy... Thank you

[@cameronbowes7813]

I like that you guys allow comments. Unlike most news agencies

[@ronvada1761]

They only want one agenda out. They don't want to hear opposition or truth!

[@mohammadrahmaty521]

Great class! Thank you!

[@kunifer]

Thanks a lot for this amazing 👏 course!

[@jamisony]

Thanks MIT, much appreciated this.

[@maxg7838]

Thank you MIT!

[@demystifycrypto3459]

who's here after hearing Gensler's comments in front of congress?

[@alexkess8506]

Thank you Gary and MIT.

[@mm-zw1zc]

Excellent discussion.

[@vinicius360vivan]

Great class, watching from Brazil. Thank you!

[@definitelyannpc2038]

Better than watching a movie!

[@MrEvilyogurt]

This is amazing thank you

[@bafanamotheogane3225]

Thoroughly enjoyed this lesson

[@noellechan7930]

thanks for sharing out this lecture !

[@markdodson5432]

Thank you, MIT!

[@2gchaz18]

great playlist! thank you!! volume on the videos is kinda low btw

[@RiccardoVincelli]

1:00:15 Theoretically, a formalization effort for an event leaf should be proportional to the expected loss or value, not the probability score itself.

[@Garce227]

Just feel so lucky and grateful😀🙏

[@l.halawani]

Whoooaaa that sounds like an awesome course. Blockchain, AI, I wonder what else!

[@pedrocontrerasavendano8578]

Really good class, thank you

[@prula]

I am a music composer/producer. If I could combine my music with smart contracts, I could collect royalties for each use automatically without a Performance Royalty organisation like ASCAP or BMI or in my case: GEMA So many uses are being undetected and therefore not paid. Also the PROs and the big TV networks etc. always take "cut" including the banks who wire the fiat. This might be an enormous power shift towards artists and against the "big guys" centralized shady organisations.

[@Ricky_Bright]

It's coming...NFT's are the start and it won't stop there!

[@prula]

@@Ricky_Bright Agreed! But I think NFTs is more like a thing for end consumers / fans. I am talking about B2B relationships and copy right transactions. That's the smart contract area... maybe! :)

[@matthewryan4844]

@@prula NFTs allow a specified royalty to be paid to the NFT creator when sold. As far as use of the asset while owned, maybe that will come soon.

[@alfmar95]

Yup, same with banking. I can stake bitcoin and get like 5% APY on an appreciating asset. Or I can have the bank do the same with my money but I'll only get like 1% while they keep the rest. Crypto is going to eliminate a lot of those "middleman" jobs

[@0xAnthony]

that EOS shilling in the course aged well

[@mastergog1]

What a great self-reinforcing business model indeed : D

[@drewcrawford7628]

Great course!

[@lennon_richardson]

Why does he abbreviate contract with a “k”?

[@jonathanhill7829]

My key takeaway - "There is no reason for 90% of what lawyers do to be done by lawyers"

[@trejohnson7677]

Well that’s a big barrier to it’s adoption. DELETE THIS COMMENT 😂.

[@ryguy2556]

You have a lot to learn

[@doukoure3468]

Is blockchain with smart contract can realy solve African weak instutions' problem? For the first time i got a little hope.

[@nicolebrown6461]

what do you mean?

[@julkiewicz]

Concerning the flight delay insurance example, I don't see what would stop any insurer from making that kind of product available without the use of smart contracts - e.g. a website where one hooks up their payment method and their deposit account and then the flight number. However there are some notable differences compared to using a "regular non-smart" contract: 1) I have to place less trust in the insurer's solvency etc. 2) I have to place less trust in the insurer's will to follow the letter of the contract. 3) The most important: the contract itself could become a security that can be traded. That's certainly not something that a simple website could allow in any way.

[@sairammurtypeddada6894]

Absolute GEM!!!

[@TheZGALa]

Thank you!

[@ravirenu2213]

Answer to the question 1.10.00 : If a transaction is entered into the blockchain and verified by a third party( let's say miners) , it doesn't necessarily allows the miner to actually know the contents of the transaction. So in essence, a third party would not actually know the flight you were travelling or didn't travel in this instance. The sole purpose of proof of work in a blockchain is to verify if a transaction has happened and to validate the transaction. Correct me if I'm wrong

[@jeremylittlefield]

Incorrect. The transactions are public in the mempool. Miners frequently mess with the ordering to profit off of the insider info thru arbitrage.

[@koushikpg007]

Lecture starts at 7:36

[@BRYDN_NATHAN]

Thank you. ✨👍✨

[@zezeze-ld5jh]

Great guest!We should learn basic codes too.

[@bungeebones]

Also, a key element of a contract is "a meeting of the minds". In order for that to occur, both parties need to be able to understand the contract. But if a contract "is in the code" and neither party can read code then there is no way their minds can meet unless they use a translated version. At that point, the contract is actually in the translation. If the code doesn't deliver what is contained in the translation then that is likely a breach. Another problem is that you end up with contracts written by programmers instead of licensed and qualified attorneys. It might end up that some programmers get prosecuted for practicing law without a license.

[@lorenzxu5481]

It is not easy for a lawyer or any other person with just basic coding education to really understand the real code, the pseudo-code maybe. Thanks Larry!

[@littlejames3877]

Would be a great market for code translators.

[@YouAreNotThisBody]

@1:13 that guy asked why blockchain is used for insurance company,the answer is to automate the insurance process without human workers.The professor did mention "no touch technology" but he got could not answer properly when questioned by the student.Blockchain and smart contract is used in the flight insurance to automtate the claims and saving money on human wokers.

[@hookssiam]

Great point

[@wasteurtime5677]

If my house burned down and I had fire insurance, then the work of a human worker might be to carry out an investigation as to whether the fire was accidental or whether I started the fire and I'm trying to defraud the insurance company. I'm not sure about how blockchain tech would automate away that human task. What is the human task in the flight insurance example?

[@julkiewicz]

Is it really true about video capture and Macs? If true that's insane. Is there any reference to back it up?

[@adriacarim1972]

What a big bunch of knowledge I'm taking from this guy and his partners. I have to say that somebody should tell the students who stand up before professor finish his speach doesn't deserve studying in that college. What a kindness fault.

[@ryanpatterson20]

No, they likely have something else to do with their time.

[@profkg6613]

Gary gensler is the head of SEC now, embroiled with Coinbase.

[@saveri0magiust0]

What Is the formal difference between a promise and a performance?

[@VarounsVlogs]

Prof emphasis at 1:08:21 is the best xD

[@victoraraujo9735]

Vitalik not Vatalik. Very good Lecture, thank's MIT OCW. (from Portugal)

[@Tony-yn5rr]

This professor is now the head of the SEC

[@saintsaveier]

SEC means ?

[@CO8848_2]

He was the head of CFTC before,

[@kasrashoughi5206]

that was amazing

[@triggeredcomments4009]

Does this involve a lot coding and intelligence (problem solving, application skills)

[@mamutislonovi]

Thanks again.

[@m.talibsameerkhan8369]

2:16 I was not expecting Stan Lee cameo in this video

[@vikmakfilms5284]

Just got more crytpos today, and crytpo contracts also, AMP, XYO, ankr , Cardano , Etherum , Bitcoin, Polygon

[@raphaelprates1500]

Readings: * "Smart contracts: 12 use cases for business & beyond" Chamber of Digital Commerce * "State of DApps: 5 Observations from Usage Data" McCann * "Etherum Competitors: Guide to the Alternative Smart Contract Platforms" Blockonomi

[@nicolebrown6461]

ty

[@BANYAT_W]

Thank you

[@mattfuerst3720]

Does anyone have a link to the studies he comments on at minute mark 0:32:28

[@CO8848_2]

The tech discussion, well, kinda was missing the big picture, not to mention some of which was not quite right, e.g., throughput of a chain is not determined by how hard the proof of work is or what hashing algorithm is involved, it’s by the defined protocol by consensus. The Turing completeness is also not really about loops, but rather computability or not; there is no limit to how many languages can be used for the smart contract is, as any Turing complete virtual machine can be represented by any high level language, too; etc etc. this might suffice for a “intro to smart contract 101 - what they are kinda taking about”, but it’s not really enough of you really want to know.

[@SV-tc8cu]

Looks like Etherium inventor name is misspelt - the correct spelling is 'Vitalik' which is short for 'Vitaly'

[@tuff2luhv558]

this would be a dream college class to go to

[@iwalereakinnusi5453]

What does DApps do in cryptocurrency business

[@anthonyjohnson2899]

Awesome 🤩

[@Onecool0]

Wow, Alan is answering Turing complete.

[@himboslice_]

How did they spell Vitalik's name wrong in the powerpoint lol?

[@G_Q_L]

this is a real use, but the legal stuff is the topic to work

[@whimsythecrypto-hippy-wolf1900]

great talk! thanx edit~ info is a bit outdated, FYI

[@radu6527]

Any class courses in UK?

[@deadfarang]

Well, we know Nick Szabo is not Satoshi. Turing complete?

[@ghaffarellis]

Turing Complete is such a headache at time. Here's why, you take the theory at surface value, assume that it should apply to a new solution. If the solution foes apply or need to apply the theory, then said solution is in valid. With bitcoin, the lock time remains a proven way for the system's accountability.

[@ctcsys]

Craig S Wright made that clear. Bitcoin ( not btc any more) is like a 2 stack machine and can be coded like Forth

[@whimsythecrypto-hippy-wolf1900]

@@ctcsys not btc anymore?? what u talking 'bout Mr Willis?