Blockchain Company's Smart Contracts Were Dumb

There's a fairly incredible trial going on in London right now. The Libyan Investment Authority is suing Goldman Sachs over some trades that they did together. To oversimplify slightly, the LIA handed Goldman a pile of money and signed some complicated contracts describing the circumstances in which Goldman would have to give LIA money back, and how much.1466190370663 And then everyone closed their eyes and counted to 10, and when they opened their eyes, poof, the money was gone. It was $1.2 billion. Libya is mad, and suing.

The LIA has various arguments in its lawsuit, but none of them amount to "Goldman owes us money under those contracts." The contracts specified a set of functions that took inputs (mostly, the prices of some bank stocks) and produced as outputs a set of dollar amounts that Goldman was supposed to pay Libya. The specifications in the contracts are perfectly clear; there's no dispute about how to read the contracts, or about how the functions work. Everyone agrees that the total dollar amount produced by the functions is zero.