Tweet of the week 🦉🏆 Very thought provoking tweet from Patrick about the news that Citigroup can’t claw back $500m from a fat finger $900m error payment (more below in regulatory corner). Financial institutions operate in a market with many repeated games within the game theory context. This means they will each consider the impact of their actions on the future actions of other players, which is why although they compete, there is generally high trust among FIs (although this clearly doesn’t extend to hedge funds!). This means operational mistakes between banks can usually be cleared up. I believe (potentially incorrectly) that this is missing from DeFi and could be a significant hurdle to overcome when the inevitable mistakes occur on the irrevocable blockchain.
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Is trust the achilles heel of blockchain?
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Tweet of the week 🦉🏆 Very thought provoking tweet from Patrick about the news that Citigroup can’t claw back $500m from a fat finger $900m error payment (more below in regulatory corner). Financial institutions operate in a market with many repeated games within the game theory context. This means they will each consider the impact of their actions on the future actions of other players, which is why although they compete, there is generally high trust among FIs (although this clearly doesn’t extend to hedge funds!). This means operational mistakes between banks can usually be cleared up. I believe (potentially incorrectly) that this is missing from DeFi and could be a significant hurdle to overcome when the inevitable mistakes occur on the irrevocable blockchain.