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dc.contributor.author
Mamageishvili, Akaki
dc.contributor.author
Schlegel, Jan C.
dc.date.accessioned
2020-11-05T14:30:56Z
dc.date.available
2019-12-27T15:54:20Z
dc.date.available
2020-01-28T12:54:17Z
dc.date.available
2020-11-05T14:30:56Z
dc.date.issued
2019-07-29
dc.identifier.other
10.2139/ssrn.3404171
en_US
dc.identifier.uri
http://hdl.handle.net/20.500.11850/387203
dc.description.abstract
We study optimal smart contract design for monitoring an exchange of an item performed offline. There are two parties, a seller and a buyer. Exchange happens off-chain, but the status update takes place on-chain. The exchange can be verified but with a cost. To guarantee self-enforcement of the smart contract, both parties make a deposit and the deposits must cover payments made in all possible final states. Both parties have an (opportunity) cost of making deposits. We discuss two classes of contract: In the first, the contract only interacts with the seller, while in the second, the contract can also interact with the buyer. In both cases, we derive optimal contracts specifying optimal deposits and verification policies.
en_US
dc.language.iso
en
en_US
dc.publisher
Social Science Research Network
en_US
dc.subject
Smart contracts
en_US
dc.subject
Deposit design
en_US
dc.subject
Costly state verification
en_US
dc.title
Optimal Smart Contracts with Costly Verification
en_US
dc.type
Working Paper
ethz.journal.title
SSRN
ethz.pages.start
3404171
en_US
ethz.size
14 p.
en_US
ethz.code.jel
JEL - JEL::C - Mathematical and Quantitative Methods::C7 - Game Theory and Bargaining Theory::C72 - Noncooperative Games
en_US
ethz.code.jel
JEL - JEL::D - Microeconomics::D8 - Information, Knowledge, and Uncertainty::D82 - Asymmetric and Private Information; Mechanism Design
en_US
ethz.code.jel
JEL - JEL::D - Microeconomics::D8 - Information, Knowledge, and Uncertainty::D86 - Economics of Contract: Theory
en_US
ethz.publication.place
Rochester, NY
en_US
ethz.publication.status
published
en_US
ethz.leitzahl
ETH Zürich::00002 - ETH Zürich::00012 - Lehre und Forschung::00007 - Departemente::02120 - Dep. Management, Technologie und Ökon. / Dep. of Management, Technology, and Ec.::03729 - Gersbach, Hans / Gersbach, Hans
en_US
ethz.leitzahl.certified
ETH Zürich::00002 - ETH Zürich::00012 - Lehre und Forschung::00007 - Departemente::02120 - Dep. Management, Technologie und Ökon. / Dep. of Management, Technology, and Ec.::03729 - Gersbach, Hans / Gersbach, Hans
ethz.date.deposited
2019-12-27T15:54:29Z
ethz.source
FORM
ethz.eth
yes
en_US
ethz.availability
Metadata only
en_US
ethz.rosetta.installDate
2020-01-28T12:54:27Z
ethz.rosetta.lastUpdated
2020-01-28T12:54:27Z
ethz.rosetta.exportRequired
true
ethz.rosetta.versionExported
true
ethz.COinS
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