21’s View: Code is regulation, however human oversight is critical.
“I imagine in decentralization, however we now have to acknowledge that people are nonetheless a part of the equation. Good contracts don’t exist in a vacuum–builders construct them, and customers work together with them. We have to discover a steadiness between automation and accountability.”
He identified that true decentralization was meant to carry steadiness again to a system folks now not trusted. But when DeFi fully removes human oversight, are we actually attaining steadiness — or simply shifting energy another way?
Glenn’s View: Code just isn’t regulation — authorized frameworks nonetheless apply.
“Ideally, we’d love for DeFi to be ruled purely by good contracts, however in actuality, governments don’t acknowledge code because the regulation. When issues go mistaken, it’s not the good contract that determines legality — it’s the real-world authorized system.”
We pointed to the Mango Markets exploit, the place an attacker manipulated a protocol’s value oracle to empty over $100 million, claiming it was a “worthwhile buying and selling technique.” But, authorized authorities noticed it as market manipulation, and the attacker now faces prices.
The takeaway?
Whereas code is regulation could be a guideline in DeFi, it doesn’t essentially align with how jurisdictions implement laws.
