Chapter 32 — Web3, blockchain and cryptoasset security: interdisciplinary interfaces
Lesson map
Lesson 32 published. Map, example, EX094.
flowchart TD
N0["Learning outcomes"]
N1["32.1 Law and governance"]
N2["32.2 Economics and incentives"]
N3["32.3 Users and communities"]
N4["Synthesis"]
N0 --> N1 --> N2 --> N3 --> N4
N4 --> EX["Worked example"]
EX --> Q["Exercise EX094"]
Logical drawing
flowchart LR
N0["Learning outcomes"]
N1["32.1 Law and governance"]
N2["32.2 Economics and incentives"]
N3["32.3 Users and communities"]
N4["Synthesis"]
N0 --> N1 --> N2 --> N3 --> N4 --> Q["EX094"]
[Learning outcomes]
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v
[32.1 Law and governance]
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v
[32.2 Economics and incentives]
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v
[32.3 Users and communities]
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v
[Synthesis]
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v
[Worked example] --> [Exercise EX094]
Learning outcomes
You will (1) connect security with law and governance; (2) consider economics and incentives; (3) involve users and communities.
32.1 Law and governance
Token systems sit within legal and governance frameworks. The cooperative's vouchers are a membership benefit, not an investment, and its lawyer confirmed they are redeemable only at the shop. Sofia learns that legal classification shapes duties, such as record keeping and consumer protection. Governance defines who decides: the board approves policy, members vote on major changes and keyholders act on board decisions. She maps each security control to its governance owner. Clear governance ensures controls have authority behind them and that emergency actions, like pausing, are accountable to members afterwards.
32.2 Economics and incentives
Security depends on incentives. Volunteers serve as keyholders out of goodwill, so the cooperative must keep their burden reasonable. Members might be tempted to record extra shifts if vouchers were valuable enough, so the weekly cap and coordinator approval limit the incentive. Sofia considers whether vouchers could be traded outside the cooperative; the contract allows member-to-member transfers, which could create an informal market. The board decides to monitor this rather than restrict it immediately. Thinking about incentives helps predict behaviour that pure technical analysis would miss, both from honest members and from occasional opportunists.
32.3 Users and communities
Sofia runs two short sessions with members at the shop, explaining wallets, backups and how to recognise suspicious messages asking for keys. Older members prefer the custodial option, while younger members value self-custody. She collects feedback that the wallet's recovery process is confusing, and the cooperative produces a simple printed guide. Users are part of the security system, and their understanding and trust determine whether controls succeed. Involving the community also brings ideas Sofia had not considered, such as a volunteer helper available at the shop each Saturday morning.
Worked example
Sofia maps controls to governance owners, monitors informal voucher trading and adds a printed recovery guide after member feedback.
Synthetic case. The governance, incentives and sessions are synthetic.
Errors and limits
Ignoring incentives misses behaviour that technical analysis alone cannot predict.
Exercises
- EX094 — Voucher classification. How are the vouchers classified? Rubric: 3 = a membership benefit redeemable only at the shop;; 2 = membership benefit;; 1 = an investment;; 0 = none.
- EX095 — Incentive control. What limits the incentive to record extra shifts? Rubric: 3 = the weekly cap and coordinator approval;; 2 = cap;; 1 = vague;; 0 = none.
- EX096 — Member feedback. What feedback did members give? Rubric: 3 = the recovery process was confusing;; 2 = recovery;; 1 = vague;; 0 = none.
Synthesis
Law, governance, economics and community engagement shape whether security works in practice.
Continue studying — chapter 32 of 40
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