Craig Wright: Smart contracts are neither ‘smart’ nor ‘contracts’

Getting your Trinity Audio player ready...

While smart contracts have become ever more popular as blockchain adoption surges, Dr. Craig Wright says they are neither smart nor should be considered “contracts.”

Dr. Wright was at the University of Exeter for the sCrypt hackathon, where he interacted with the students and answered all their Bitcoin questions. In an interview with CoinGeek Backstage, he talked about building on Bitcoin, blockchain decentralization, smart contracts, and more.

“Smart contracts is a pretty little term that sounds good, but there are two problems—they are not smart and they are not contracts,” he told CoinGeek Backstage reporter Becky Liggero.

“They are not smart; they are automated,” Dr. Wright stated.

Additionally, contracts can only be between two people, and “when it’s automated and just executes, that’s not a contract, it’s just the evidence component of an exchange.”

In his presentation to the students at the hackathon, Dr. Wright talked about the myth of decentralization and how it affects the stability of a protocol.

As he told CoinGeek Backstage, decentralization isn’t about how many nodes are in a network. Rather, it’s about whether there’s an entity that controls the software that runs the nodes on the network.

“Bitcoin is decentralized because it has a protocol that’s set in stone. Ethereum is centralized because a small group controls the future of a system. BTC is centralized because three developers control the repository and decide which changes occur.”

However, these protocol developers continue to tout their decentralized nature to give users an illusion they lack total control of the network.

Dr. Wright further debunked the “code is law” myth that he says is pushed by individuals who want “to sit behind the curtain in a Wizard of Oz way and run the system without the public’s knowledge.” This group is against democracy and believes they have superior intellect and, thus, they should set the rules.

“The nature of decentralization is allowing people to control their own lives,” he noted.