Trustless

Basics

• A term often used together with decentralized, permissionless and non-custodial.
• From Bankless (26-10-2020) had a post describing what it meant:

"The lack of required belief that another party will behave in the the manner specified beforehand."

"Maximal, complete, and uncompromising assurances that a counterparty will behave as intended"

So it boils down to this:

1. You can always access your money
2. No one else can access your money

Using this framework for evaluating DeFi applications, the level of ‘trustlessness’ in the system extends far beyond ‘admin key risk’."

Cryptoeconomics

• From Eric Wall (1-5-2021):

"cryptoeconomic security is the concept of making evil actions cost more for the attacker than what the upside is. It is about creating systems that punish evil actors financially for not doing what they’re desired to do, so much that you as a user can rely on them to act faithfully in alignment with a protocol’s mission. In a cryptoeconomic system, you don’t need to trust that people are honest. You just trust that people are economically rational and are doing what’s best for themselves financially. This principle is the core, or atleast it was supposed to be the core, of all that underpins the modern public blockchain invention: the idea that we can build trustless systems and do away with trusted points of failure."