The Trust Cornerstone of the Web3 World: From Immutable Code to Infinite Repeated Games

In the Web3 ecosystem, we often consider "immutability" as the ultimate guarantee of trust. However, this is just the starting point for building trust.

For the assets themselves, the immutability of the ledger is indeed sufficient. The hard cap of 21 million Bitcoins has laid the foundation of confidence in the blockchain world. As long as the balances of ERC20 tokens, NFT ownership, and cross-chain transfers are recorded on the chain, they are convincing enough without relying on human factors.

But for commercial entities, protocols, and project parties, an immutable ledger is just a basic function and threshold. What truly earns trust is not just that it "cannot be changed", but also that it "cannot leave" and "is unwilling to leave".

The path of trust in Web3 does not stem from consensus mechanisms or nodes, but is gradually accumulated through transactions. Trust is the product of repeated games and an accessory to high default costs. It is not a "consensus" that arises out of thin air, but a tacit understanding that naturally settles through repeated capital turnover and performance guarantees.

In certain traditional business areas, the real "trust layer" is not only built on kinship, geography, and personal connections but is also established and reinforced through repeated interactions. The foundation of financial credit is not just the ledger, but the tacit understanding formed after countless games of negotiation. Trust, like peace, only exists within the realm of intertwined interests.

These regions may have recognized earlier than Wall Street that understanding the background (KYC/KYB) is just the beginning: true trust does not exist in decentralized nodes, nor is it cultivated; rather, it is gradually formed through transactions, amidst defaults and compliance.

1. High-Frequency Repeated Games and Cross-Regional Mutual Guarantee Networks

In certain regions, underground financial networks are essentially based on a trust system accumulated through high-frequency, long-term trading. Its clientele is not limited to local areas, but covers a wide range of immigrant communities from Southeast Asia to North America.

The establishment of this cross-regional financial cooperation mainly relies on two core structures: high-frequency repeated games and cross-regional mutual guarantee networks.

A businessman operating overseas has long been transferring funds to domestic family members or partners through financial intermediaries. Over time, he will develop a pattern of long-term repeated transactions with the intermediary financial institutions and agents. This structure is not a one-time event; it is based on the expectation of "I dare to give you one million because I know you will come back to me for another one million next year."

These trading networks do not rely on contracts but rather on trust-based locking structures: family reputation, word-of-mouth transmission, and mutual guarantee mechanisms, allowing for "remote performance" even across thousands of miles.

2. Cost of Breach: The Clearing System in Informal Order

In this system, trust is not an innate virtue but rather a result of rationality. The high cost of default is the fundamental reason why people "dare not default."

If a transaction defaults, it will not only ruin local reputation but also quickly spread through family networks, hometown connections, and clan communities, forming an irreversible social "clearing" mechanism. It does not go through legal channels, but is enough to make it "difficult to establish oneself abroad."

This is an alternative system of "non-legal sanctions." It is not official, but it is more efficient and more deterrent than the official one.

You may not believe in contracts, but you cannot doubt the ban order from the entire clan association.

3. The Multilateral Settlement Network of Funds: The Intangible Transaction Locking Structure

Another core mechanism of the financial network in certain regions is the multilateral clearing network for funds.

Different financial intermediaries do not operate in isolation, but to some extent serve as each other's "channels" and "hedges."

This is like a naturally formed "Layer 2", building a highly elastic yet strongly locked structure through the flow of funds between different nodes:

• Funds circulate among multiple points, forming an entanglement of human relationships and interests;

• Behind every transaction is a "if I get into trouble, you will too" community debt structure.

This system is more flexible and resilient than any on-chain bridging protocol we understand today, even though it has no lines of code.

4. The immutability of code is just the beginning; the "not leaving" after locking assets and the courage to continue the game are what makes one an "insider."

In Web3, we often regard "immutable code" as the ultimate trust, but this is just the tip of the iceberg.

For the asset itself, an immutable ledger/no lies is sufficient. However, trust in a merchant or an agreement involves a higher dimension of logic and thresholds.

We shouldn't ask, "Does this protocol have vulnerabilities?" Instead, we should ask, "Is this protocol willing to bind with me for 4 years?" and continuously contribute and flow within this ecosystem.

Locking funds is a form of "self-collateralization" in economic games; ve(3,3) is a game commitment to prove to the community "I won't run away, I am willing to play in the long term."

• You lock up, I lock up, we lock each other in, so that we can form a stable mutual trust;

• You dare to gamble repeatedly, only then will I believe you won't betray------the key word is "dare";

• Do you dare to keep all your funds circulating in this ecosystem, without leaving?

Note: The lock-up referred to here includes not only the tokens allocated to the project party in the agreement but also funds raised from public/private offerings, protocol revenues, and even personal funds of the project's founders. You/I refer to the relationships between merchants and between agreements.

But don't misunderstand, "locking up assets" is just the beginning, merely a commitment to enter the entire ecosystem as a "token of investment." What matters is the subsequent repeated game ------ whether one dares to keep the value within the ecosystem.

A DeFi protocol that truly earns trust is not about whether it is open source, but whether it institutionally restricts its own exit rights and continuously circulates assets within the ecosystem ------ having the courage to engage in long-term repeated games is the cornerstone of trust.

In short, a tamper-proof smart contract is far less trustworthy than an opponent who is unwilling to leave.

V. The Misguided Goals We Pursued Over the Years - The Trust Upgrade of Web3 is Not Just a Module, But a Game Design

The current Web3 aims for high TPS, low Gas, modular settlement layers, decentralization, and so on. However, these do not build trust in products, projects, or protocols.

Trust is not a technical indicator, but a structure of a long-term game relationship.

Traditional financial networks tell us: the most reliable relationships are not the rules written in contracts, but the structures written in the costs of default.

Just like the social settlement system of informal financial networks, DeFi should also be designed so that if you run away, not only will your reputation be zeroed, but you will also be settled through multilateral financial relationships------lock-up mechanisms, voting rights, and governance rights binding are the on-chain translations of these "gray settlement mechanisms."

What we should build is an environment that allows protocols/merchants to dare to engage in infinite repeated games.

Remember, the consensus mechanism is just the tip of the iceberg; the locked funds and repeated games are the alliances beneath the surface.

"Insiders" are not defined by what you say, but by how you commit your time, money, and reputation, joining your allies in the abyss.

VI. Epilogue: The Future of Trust, Born from an Unbreakable Alliance

"Insiders" is not just an emotional slogan, but the most formidable system: if you exit, I am doomed too.

This institutional "irrevocability" and the ability to "dare to continuously invest and accumulate" is the ultimate trust structure that Web3 should pursue.

Technology can create ledgers; systems can create order; but only games can create trust.

The best trust is not based on "faith", but on what you cannot help but believe.

It is very similar to that classic song "Only by Striving Can You Win."

Fate accounts for 30%, while hard work accounts for 70%.

Love "Bo" (Chess) to win

Afterword

In order to enhance the readability of the article, this paper focuses on the concept of "repeated games." Forcing participants (mainly referring to merchants) into the environment of repeated games under the premise of lacking in-depth understanding and high default costs is also a form of local optimal solution.