These are not some magical anonymous items that are above the law and inviolate

It is an article of faith is some circles that the blockchain is exactly this kind of magic :-/

Just to clear some things up:

• In some contexts, 'smart contract' is a misnomer: it's just a computer program that resembles a legal contract but does not interact with the government in any way. It just moves money according to agreed-upon rules. I don't think it's common to use both a legal contract and a 'smart contract' to enforce the same agreement.

• In the specific case of the project known as 'TheDAO', the terms of service does indeed waive all legal rights and says that whatever the computer program says supersedes all human-world stuff. (https://daohub.org/explainer.html)

• All of this stuff is so experimental that there's an exception to everything at this point.

So, the theory goes:

In a normal contract you agree to abide by some rules. If you break them penalties, etc.

But you don't have to 'just' trust those rules to agree to the contract. You have to trust the oversight body. If you get the better of me on the text of the contract I might turn around and appeal to a judge that you are still violating the spirit of the contract.

The idea of the 'Smart contract' is that the code is the contract, and there is no appeal. Our 'contract' is just an executable which does what it does. You only have to trust it, and not some random judge.

This instance, where someone is unhappy with how their smart contract worked out in practice, and the dev/community at large are playing judge, has a lot of people wondering whether they are ending up with the worst of both worlds.

Law might want to govern them, but the power of the state is limited. A court can't compel a computer that executes code to do anything.

The contract isn't enforced by a court of law but is enforced by computer code.

So I will comment on the one example that I can speak somewhat fluently on, which is Thought experiment #2.

In the modern economy, hedges are publicly traded as well as the stocks. It is impossible for one to rise in value without the other falling, simply because information is public. If the executive begins to buy huge hedges against his corporations stock, the value of the hedge will rise.

Even if no one knows who exactly is buying these hedges, the price is going up, and so people will either begin to buy hedges as well, thus reducing the gain on them, or they will sell the stock, lowering its price and reducing the gain on the hedge.

Also, buying hedges based on private information would also be insider trading....at least in the US.

naively assuming linear returns to medical research funding

Likely the returns in medical research would be not even close to linear. The Law of diminishing returns will hit you hard. Spending 10x more on research will likely net you far less than a 10x increase, you would likely be lucky if you got half or a quarter of that. Science comes in steps and part of the process that reduces so much waste is peer reviewing and replication of results. Some processes simply cannot be sped up, regardless of funding. Even with infinite funding, I would be impressed to see a 10x growth.

My main question to you is: Why is it better to have a million robots that are all able to do "X" and build themselves instead of one factory that builds robots and a million robots that do "X"?

Obviously replication in certain circumstances is very useful (mars/space exploration for example where "shipping costs" are not only astronomically expensive but nearly impossible on large scale). In the same way 3D printers are useful not because they can replicate themselves (the cant), but because they can create custom things in short amounts of time wherever and whenever they are needed. It is because the jobs they are doing is small scale that they are efficient. You can ship one thing and have it create 100s of other things.

I'm also unhappy with him being banned from commenting but not downvoting. While I frequently found his comments obnoxious and annoying in their connotations, they definitely served a net positive on the site.

That said, his moderation practices clearly served a larger net negative, so if there are technical reasons why it's difficult to undo his moderation and ban him from moderating in the future, I suppose this is the best we can get.

The ban made me uncomfortable, and the talk of Eugine as being "guilty" makes me even more uncomfortable. My take:

Perfect is the enemy of the good. If we expect massive downvoting to be a recurring problem, then maybe it would have been worth waiting until the development of non-voting accounts or dekarmification mechanisms. As an ad hoc solution to the problem du jour, banning a user is fine.