Mattereum

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= "Mattereum is the first Internet of Agreements infrastructure project, bringing legally-enforceable smart contracts, and enabling the sale, lease, and transfer of physical property and legal rights".

URL = https://mattereum.com/

See also the Internet of Agreements site


Description

Vinay Gupta:

"Mattereum.com (@Mattereum) is my bid to get the necessary legal frameworks in place to make direct control of physical property using the blockchain recognized in 150+ countries. I want to break the door open to the material world so you can change the status of a smart contract, and have a real-world court recognize that legal ownership of a fiat asset has changed hands. Fiddly, but it’s necessary infrastructure for all of our next steps together." (https://medium.com/humanizing-the-singularity/2018-year-in-preview-the-future-of-cryptocurrency-b99110480ff0)

Introducing the Mattereum Asset Passport

Vinay Gupta:

So, when all is said and done, all theory aside, what does it do?

The Mattereum process is three parts: Asset Passports, Automated Custodians, and the Smart Property Register.

The Automated Custodian is the technical/legal machinery for doing instant property ownership transfer almost anywhere in the world: an atomic swap for property. We aren’t there yet, but we are working hard on it. The Smart Property Register is for contract composability: it’s how you’d put your house into a pool for a Blockchain Airbnb based on sublease clauses in your rental contracts. Again, that’s over the horizon: the defi ecosystem has to mature a bit before that has genuine utility, although MakerDAO’s ecosystem is rapidly approaching the point where this functionality would be useful!

So that leaves the Mattereum Asset Passport, our first product.

What is the Mattereum Asset Passport? It’s a domain name for physical matter. Is is the abstraction required to connect ordinary physical matter to the internet, in the same way that domain names were the abstraction layer required to connect existing brands, concepts and information assets to the internet.

It is literally an Ethereum smart contract which serves to collect together all the relevant identification information for an object. This information is presented as a second series of smart contracts, which sell very specific indemnification contracts to verify that the information about the object is correct, and pay out if it is proven to be in error. The Mattereum Asset Passport is sort of like a microDAO surrounding an object: a plurality of people all make claims about an object and its provenance, and they can all stake their money on the accuracy of their claims. Anybody that wants to take them up on those promises pays for the privilege. The more people are relying on your data, the more money you get paid. But people can make claims, and invite people to rely on those claims, cooperatively or competitively. It is a market for facts about things; the necessary market infrastructure to effect a transformation in how we approach the material world. There are penalties for being wrong.

That paradigm applies at every level of trade, from Magic the Gathering cards up to oil tankers.

Our initial alpha relies on quite a few Old World fiat abstractions but as time passes every level of this structure can be automated. Payments go from fiat-enforceable promises, to escrow accounts, to third party judicial release escrow accounts, up to proofs of insurance and reinsurance, over time. Likewise, we start by using fiat identity in the same manner as would be typical for KYC, but will upgrade to uPort, SOVRIN and other decentralized identity solutions as the technology matures.

In the medium term, it will be all on-chain." (https://medium.com/humanizing-the-singularity/how-post-industrial-capitalism-and-a-new-type-of-big-data-will-save-the-planet-6574b1d75bf6)

History

Vinay Gupta:

"Mattereum started to create a “supreme court of the internet” for hearing disputes related to the use of Ethereum and other smart contracts in real world trade. This business model uses the provisions of the 1958 New York Convention on Arbitration to establish a private court which users can opt in to for their dispute resolution by including simple boilerplate text in their contracts. We saw this (and still do!) as a vital missing component in getting world trade on to the blockchain platforms that are emerging.

Many such specialized courts already exist for industries like construction or ship-building, handling hundreds of billions of dollars of disputes every year, so why not for the blockchain space? Most of our innovations in this area relate to technical evidence handling, court procedures, and cost control. Importantly, the awards made by courts of this type are easily enforced internationally. But blockchain adoption in the real world has been slow, and the dispute volume to support such a court does not exist yet. We were a little early.

We then pivot Mattereum into its second phase: the initial arbitration-centric “supreme court of the internet” model, which is well-suited to providing legally binding dispute resolution services for large volume commercial transactions, pivots to become the “smart property register”, in which we figured out how to apply these concepts to much smaller transactions by narrowing focus to a specific subset of disputes: disputes about the authenticity or qualities of a physical object. Mattereum does this by taking a whole set of disputes about point-of-fact issues, and moves them out of litigation-style dispute resolution — adversarial, multiple parties, win-lose, complex burden of proof type decision-making, fault-finding etc. — to insurance claim style dispute resolution. We accept that insuring against the damage done by human error and occasional low-level fraud is necessary for function in the real world. Trade needs this. VISA proved that.

We then narrow focus further to the first component of the Smart Property Register: the Mattereum Asset Passport, which is essentially a Self Sovereign Digital Identity for a physical object. An Asset Passport can optionally include a Digital Twin of the object.

An enormous number of disputes in the real world are about the attributes of objects purchased, including secondary situational factors like delivery time. But the basic dispute frameworks are that the thing was not as described, or thing was not fit for purpose and has to be returned or revalued. Accurate, truthful, complete information wipes out entire sets of disputes, bringing down the overall system costs for dispute resolution across all trade. It is like the difference between doing business in a clean vs. a corrupt economy: there’s a threshold past which things just get easy, and the economy really beings to fly. That’s what we envisage doing for the trade in physical assets.

The more we can get people to tell the truth about their offers, the more efficiently the overall economy runs. We have to reshape the incentive landscape to get full disclosure about products, and the Mattereum Asset Passport achieves this. Essentially, we want a paradigm where, when something goes wrong, people do the equivalent of swapping insurer information, and moving on with their day. We want a situation in which the normal accidents of everyday trade can be covered at a financial level, without requiring complex dispute resolution procedures in cases without contentious dispute. Ideally such a system should punish attempted fraud, rather than reward it — and for that to work, the burden of proof must be very precisely positioned not to create pathological incentives. We feel our design achieves this.

Mattereum’s business model depends on the research, development, and service design we did during this phase. The arbitration model we built to provide relatively affordable global dispute resolution for smart contracts also backs up the dispute resolution mechanisms used in the smart property register. Small disputes are handled using an insurance-type model, and larger disputes or problematic misrepresentations are escalated to our other dispute resolution forums. Without this model, disputes about blockchain smart contracts and oracles would have to be handled in regular courts, which would be unfeasibly slow and expensive. Justice has to be fast and economical if it is going to support a low transaction cost blockchain economy." (https://medium.com/humanizing-the-singularity/how-post-industrial-capitalism-and-a-new-type-of-big-data-will-save-the-planet-6574b1d75bf6)


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