Contemporary society is expeditiously embracing decentralized solutions for human interaction. Increasingly complex frameworks, theories and models are needed
Contemporary society is expeditiously embracing decentralized solutions for human interaction. Increasingly complex frameworks, theories and models are needed to understand the issues facing contemporary societies. Crypto-economics as a discipline is an attempt to create models that allow the analysis of interrelationship in increasingly complex frameworks of human interaction in distributed systems. Most commonly accepted public blockchains are a product of crypto-economics.
The term “Crypto-Economics” has been defined in several different ways. Most commonalities in definitions for the term crypto-economics include the use of cryptography and incentive design to created networks, applications, and systems. Further, crypto-economics is interdisciplinary. Economics examines how individuals and groups respond to incentives. Connecting it to traditional economics, crypto-economics is mostly associated with mechanism design, a sub-discipline of economic theory and mathematics.
Yet, crypto-economics is more applied cryptography than economics. Considering money as an engineering problem as well as considering technology from the perspective of economic incentive design and security, problems in economic terms are unique elements of this discipline and may feel counterintuitive for economists and engineers alike.