Mechanism
= (in the context of Crypto): "A mechanism is a tool that takes in inputs from multiple people, and uses these inputs as a way to determine things about its participants’ values, so as to make some kind of decision that people care about" [1]
Context
"We are entering a hyper-networked, hyper-intermediated and rapidly evolving information age, in which centralized institutions are losing public trust and people are searching for alternatives. As such, different forms of mechanisms – as a way of intelligently aggregating the wisdom of the crowds (and sifting it apart from the also ever-present non-wisdom of the crowds) – are likely to only grow more and more relevant to how we interact."
- Vitalik Buterin [2]
Description
"Mechanisms are algorithms plus incentives:
First, what is a mechanism? Here I use the term in a way similar to that used in the game theory literature when talking about mechanism design: essentially, a mechanism is an algorithm plus incentives. A mechanism is a tool that takes in inputs from multiple people, and uses these inputs as a way to determine things about its participants’ values, so as to make some kind of decision that people care about. In a well-functioning mechanism, the decision made by the mechanism is both efficient - in the sense that the decision is the best possible outcome given the participants’ preferences, and incentive-compatible, meaning that people have the incentive to participate “honestly”.
(https://nakamoto.com/credible-neutrality/)