Oracles Are Important in the Future of a Block Chain

Critics of blockchain often say that it is nothing more than a database, but today’s guest, Ari Juels, has a different opinion. His technical expertise (he is a Professor of Computer Science at Cornell Tech), combined with his ability to understand both sides of a divisive topic like this one, make for a very insightful conversation about Bitcoin, NFTs, and smart contracts. We talk about the reasons for the valid skepticism that surrounds blockchain technology, the various reasons that Ari believes that it is a powerful, useful tool, despite its downfalls, pyramid schemes, decentralized exchanges and more!

Key Points From This Episode:

• The significance of the Bitcoin innovation to Ari’s field of study. (0:03:40)
• What piqued Ari’s initial interest in digital currency. (0:04:46)
• Ari explains the difference between permission and permissionless blockchains. (0:06:27)
• Comparing a permission blockchain with a distributed-append-only database with authorized contributors. (0:08:34)
• A number of reasons why permissionless blockchains have been so widely embraced (despite Ari’s initial prediction to the contrary). (0:12:24)
• Fraud in the cryptocurrency space; Ari shares his thoughts. (0:14:28)
• The benefits of the cultural phenomenon of NFTs. (0:19:25)
• Examples of NFT-related issues that still need to be addressed. (0:26:04)
• How smart contracts can be used by criminals to their advantage. (0:30:09)
• Why smart contracts are well suited for compliance. (0:32:02)
• An example of a smart contract pyramid scheme. (0:35:48)
• Some of the pros and cons of the inflexibility of smart contracts. (0:41:09)
• What flash loans are and what they can be used for. (0:46:11)
• Understanding the value of oracle systems. (0:50:04)
• How the Candid system that Ari’s group developed helps to mitigate the problem of lost Bitcoin keys. (0:57:04)
• Ari explains the advantages and disadvantages of a decentralized exchange. (01:01:19)
• How the blockchain has improved code writing. (01:07:57)
• The importance of balancing privacy and accountability in DeFi systems. (01:09:38)
• Ari’s thoughts about the future potential of blockchain technology. (01:14:03)
• The biggest concerns that Ari has about the blockchain space. (01:15:24)
• Why skepticism about blockchain technology is valid. (01:17:31)
• The facet of the blockchain space that Ari is most excited about. (01:19:51)

Links From Today’s Episode:

Rational Reminder on iTunes — https://itunes.apple.com/ca/podcast/the-rational-reminder-podcast/id1426530582.

Rational Reminder Website — https://rationalreminder.ca/ 

Shop Merch — https://shop.rationalreminder.ca/

Join the Community — https://community.rationalreminder.ca/

Follow us on Twitter — https://twitter.com/RationalRemind

Follow us on Instagram — @rationalreminder

Benjamin on Twitter — https://twitter.com/benjaminwfelix

Cameron on Twitter — https://twitter.com/CameronPassmore

Ari Juels on Twitter — https://twitter.com/AriJuels

Ari Juels — https://www.arijuels.com/

The Ring of Gyges: Using Smart Contracts for Crime — http://www.arijuels.com/wp-content/uploads/2013/09/Gyges.pdf

NFTs for Art and Collectables: Primer and Outlook — https://www.arijuels.com/wp-content/uploads/2022/04/NFTs__Primer_and_Outlook.pdf

‘Huge mess of theft and fraud:’ artists sound alarm as NFT crime proliferates — https://www.theguardian.com/global/2022/jan/29/huge-mess-of-theft-artists-sound-alarm-theft-nfts-proliferates

Incomplete Contracts and Control — https://www.nobelprize.org/uploads/2018/06/hart-lecture.pdf

Chainlink 2.0: Next Steps in the Evolution of Decentralized Oracle Networks — https://research.chain.link/whitepaper-v2.pdf?_ga=2.99068702.124468793.1661870135-1990502175.1661870135

Flash Boys 2.0: Frontrunning, Transaction Reordering, and Consensus Instability in Decentralized Exchanges — https://arxiv.org/pdf/1904.05234.pdf

Themis: Fast, Strong Order-Fairness in Byzantine Consensus — https://eprint.iacr.org/2021/1465.pdf

Cleaning Up Cryptocurrency: The Energy Impacts of Blockchains — https://energycommerce.house.gov/sites/democrats.energycommerce.house.gov/files/documents/Witness%20Testimony_Juels_OI_2022.01.20.pdf

The Seven Grand Challenges — https://www.initc3.org/projects.html