Smart contract economics refers to the study of economic incentives and behaviors within systems governed by self-executing contracts on a blockchain. This includes fee mechanisms, tokenomics, and the design of reward structures that influence user and developer participation. It examines how economic principles apply to decentralized applications.
Context
Smart contract economics is a frequent subject in analyses of decentralized finance (DeFi) and other blockchain applications. News often covers how adjustments to token distribution, transaction fees, or staking rewards affect network security and user engagement. Understanding these economic models is crucial for assessing the viability and sustainability of various crypto projects.
A game-theoretic framework for smart contracts proves unique, stable equilibrium, transforming resource allocation from ad-hoc to provably efficient and fair.
A new mechanism design framework formally proves the existence of "contract equilibria" and introduces a decentralized algorithm to ensure efficient, fair resource allocation via smart contracts.
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