Currency Always Has Costs, Ctd

Readers may recall the Tornado Cash platform, and an odd defense of it posted by industry insiders. Now Professor Henry Farrell and security guru Bruce Schneier have a response under the entertaining title “Tornado Cash Is Not Free Speech. It’s a Golem” on Lawfare:

We think that the most useful way to understand the speech issues involved with regulating Tornado Cash and other decentralized autonomous organizations (DAOs) is through an analogy: the golem. There are many versions of the Jewish golem legend, but in most of them, a person-like clay statue comes to life after someone writes the word “truth” in Hebrew on its forehead, and eventually starts doing terrible things. The golem stops only when a rabbi erases one of those letters, turning “truth” into the Hebrew word for “death,” and the golem ceases to function.

The analogy between DAOs and golems is quite precise, and has important consequences for the relationship between free speech and code. Ultimately, just as the golem needed the intervention of a rabbi to stop wreaking havoc on the world, so too do DAOs need to be subject to regulation.

It’s a curious statement, and the article makes for fascinating reading. Leaning into a ruling made in 1996 …

… U.S. District Judge Marilyn Hall Patel ruled that computer code is a language, just like German or French, and that coded programs deserve First Amendment protection. That such code is also functional, instructing a computer to do something, was irrelevant to its expressive capabilities, according to Patel’s ruling. However, both a concurring and dissenting opinion argued that computer code also has the “functional purpose of controlling computers and, in that regard, does not command protection under the First Amendment.”

Which I suspect is in need of updating, as at least this informal description suggests a poor understanding of the function of natural languages vs computer languages, the latter of which are little more than enhanced instruction sets that do not involve free will. In an odd way, this ties in with a complaint of mine a ways back that programmers tend to freely analogize with real world constructs, and sometimes that’s inappropriate. Natural languages’ primary usage is communication with other humans and, potentially, other sentient beings; not so computer languages. Back on point, though:

This disagreement highlights the awkward distinction between ordinary language and computer code. Language does not change the world, except insofar as it persuades, informs, or compels other people. Code, however, is a language where words have inherent power. Type the appropriate instructions and the computer will implement them without hesitation, second-guessing, or independence of will. They are like the words inscribed on a golem’s forehead (or the written instructions that, in some versions of the folklore, are placed in its mouth). The golem has no choice, because it is incapable of making choices. The words are code, and the golem is no different from a computer.

Which is a more artfully put criticism than mine, but essentially the same. The balance of the article’s coverage of Tornado Cash is both frightening and horrific; I can’t shake the feeling that the hidden attitude is inarticulate defiance.

In other crypto news, Coinbase is being sued. Who will win?

Over the past year, thousands of people have lost tens, if not hundreds, of millions in cryptocurrency when gangs of sophisticated scammers whisked their money out of their accounts, which are managed by an app from the publicly traded cryptocurrency giant Coinbase.

Now those victims are fighting back. Nearly 100 peopleare trying to hold Coinbase accountable, saying the company didn’t do enough to protect them. Scam victims says they notified the company, begging it to fix defects in its Coinbase Wallet software that had allowed the victims unknowingly to grant the scammers access to their accounts.

The requests were to no avail, scam victims say.

“They’re trying to be a financial institution without the infrastructure to back it up,” said Eric Rosen, a lawyer at Roche Freedman representing some 96 victims in the arbitration demand, which is akin to a lawsuit, filed against Coinbase. [WaPo]

Celeb Kim Kardashian was fined a few weeks back for not following procedure when promoting crypto:

Celebrities who endorse cryptocurrency received a much-needed warning from the Securities and Exchange Commission through a $1.26 million settlement with Kim Kardashian. But it’s not likely to scare some of these highly paid promoters from hawking this highly speculative investment.

The SEC charged Kardashian with failing to disclose that she was paid $250,000 to promote EMAX, an obscure crypto offered by EthereumMax.

Tout crypto if you want, but you had better be upfront about your bias, the agency is telling social media influencers. [WaPo]

And if you want more on crypto thefts and cons, check out Molly White’s Web3 Is Going Just Great blog. BTW, she’s no relation of mine, or at least I don’t think so. Old Bitcoin continues to bubble around $19,000/coin and makes no moves towards returning to its old highs of $60,000/coin.

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About Hue White

Former BBS operator; software engineer; cat lackey.

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