The Essence and Application of Trigger Operators

The trigger operator plays an important role in smart contracts. When the internal logic of the contract meets specific conditions, external actions are required to trigger state changes. This stems from the essence of smart contracts under Satoshi Nakamoto's architecture: each operation is a global auction. Some designs that attempt to automate triggers often overlook this game-theoretic issue, which can lead to risks of attacks or arbitrage.

The core of the trigger operator is a nonlinear exchange based on GAS consumption, the cost of information transmission, and the benefits of state change. This nonlinear characteristic raises a question: can a self-reinforcing mechanism be formed on certain dimensions to sediment value? This requires us to analyze the characteristics of the trigger operator in depth.

Typically, a trigger operator consists of three key elements:

1. Trigger Permission: Is there a restriction on the triggering entity, such as repayments in borrowing being triggered by the borrower, while liquidation can be triggered by anyone.

2. Information transmission: Whether to pass information or assets to the contract when triggered, which may affect the triggering cost.

3. Time Relevance: Whether the validity of the trigger is related to time, which will affect the triggering strategy.

In decentralized finance (DeFi) design, trigger operators are often positioned as third-party actions, primarily used for liquidation. This involves incentive design issues. Different scenarios will design different incentive mechanisms, especially in terms of information costs and time effects.

Triggers based entirely on information costs may lead to miners becoming the final beneficiaries. In contrast, triggers that incorporate time effects can be designed in a Dutch auction structure, allowing most of the value to belong to the actual triggerers. However, this also brings about discrepancies in the speed of time and the willingness to participate.

In addition to clearing, trigger operators also have important applications in automatic hedging, a potential that has yet to be fully explored. Furthermore, creating or actively contributing information through trigger operators is also a direction for application. Over time, due to their non-linearity and broad applicability, trigger operators may become the first on-chain operators to capture value.

A key question is: can the trigger operator independently form a game system? Since each trigger operator is dependent on a specific scenario, it is difficult to operate under a unified incentive system. This is different from Ethereum's specification that each instruction incurs GAS consumption, where the underlying instructions are standardized first, and then the contract structure is selected in reverse. Establishing an independent trigger operator game system is akin to requiring different trigger scenarios to adhere to the same design standards, ensuring consistency in input and output value. Although this is challenging, it is also a direction worth exploring: should triggers be the starting point for smart contract development?

The trigger operator, as a component of a large game system, may possess certain self-enhancing characteristics, such as being used for hedging or quoting. Here, due to the contributions of other participants in providing value, the incentives for the operator are not completely linear.

In summary, the nonlinear structure of trigger operators can be combined with large contracts to form self-reinforcing non-cooperative games with economic value. However, it is difficult to independently design a game system and crystallize value. From this perspective, some existing products have logical issues and effectively become internal lottery systems.