>I don't see how this is different for smart contracts, as opposed to, say legal contracts written in english
It's different because the whole purpose of smart contracts is to circumvent governmental power structures. Otherwise, people would use regular contracts.
Technologically, it's much easier to set up a payment system using a centralized database in a specific jurisdiction and have people sign normal contracts to use the system. People create cryptocurrency systems to avoid that. They put much effort into creating payment systems independent of existing power structures. If this system does not work without backup from the legal system and governmental power, then all that effort is pointless.
>I thought originally that you were in favour of smart contracts
I think they're interesting.
>Are you saying what he did is wrong, but he should be allowed to do it anyway?
Yes.
>If so, why?
Using existing governmental power structures to punish people who adhere to smart contracts in ways some system members don't like invalidates the whole system. If cryptosystems don't work purely technologically without judicial support, they don't work, period.
I think you're letting the perfect be the enemy of the good. It seems like an obvious advantage to have systems that decide the outcome automatically and correctly 99% of the time, despite requiring occasional corrections from outside. That's not the same as a regular contract, so it doesn't follow people would always either choose smart contracts or traditional ones.
What you're hoping for is, taken literally, impossible. Smart contracts can't protect people from fraud, or coercion. Since the law does protect them from these things, smart contracts cannot be totally isolated from the legal system (even if everyone wanted this, which they don't).
> Using existing governmental power structures to punish people who adhere to smart contracts in ways some system members don't like
Fine, but what about in ways that the rest of society don't like?
>It seems like an obvious advantage to have systems that decide the outcome automatically and correctly 99% of the time
That's what traditional systems already do.
>Fine, but what about in ways that the rest of society don't like?
They don't participate in crypto.