Blockchain Papers

Aljosha Judmayer, Alexei Zamyatin, Nicholas Stifter, Edgar Weippl

No abstract is available for this record.

Jeffrey Bukhari

The use of the digital currency Bitcoin has spiked dramatically over the last several years. Spurred by interest from investors and those excited about its commercial and banking potential, the value of the cryptocurrency has seen its value greatly increase since its beginning in 2009. This project explains the underlying technology behind Bitcoin, how Bitcoin is and will change commerce, and what potential lies ahead for the digital currency.

Aljosha Judmayer, Alexei Zamyatin, Nicholas Stifter, Artemios G. Voyiatzis · 5 authors

No abstract is available for this record.

Mattias Gleisner, Karoline Edström

Pengar har under en lång tid spelat en central roll i människans samhälle och dagens samhälle präglas av allt mer handel. Utifrån detta har nya betalningsmetoder utvecklats. En förändring i konsumentbeteendet har bidragit till att allt fler individer väljer elektroniska betalningstjänster. En relativt ny innovation är kryptovalutan bitcoin som erbjuder betalning mellan köpare och säljare utan inblandning av en tredje part. Ett flertal studier har gjorts med syftet att fastställa om bitcoin är en valuta eller en tillgång, något som visat sig vara svårt. Något som varit tydligare är att bitcoins värdeförändringar inte tycks vara korrelerad med andra investeringsalternativ. I en studie av Brière et al. (2015) drogs slutsatsen att bitcoin är en intressant tillgång för en investerare tack vare bitcoins låga korrelationskoefficient med andra tillgångar. Denna studie grundar sig i de teoretiska utgångspunkterna om Famas (1970) hypotes om den effektiva marknaden, Markowitz (1952) moderna portföljteori och Rogers (2003) teori om spridning av innovationer. Med detta som utgångspunkt är syftet med denna studie att undersöka hur korrelationskoefficienten mellan bitcoin och traditionella investeringstillgångar som aktier, valutor och råvaror ser ut idag samt hur dessa har förändrats över tid. Med hjälp av Famas (1970) teori om effektiva marknader och Rogers (2003) teori om spridning av innovationer kommer en diskussion om huruvida bitcoins egenskaper som investering i den moderna portföljen har förändrats i takt med att bitcoin blivit mer använd, både som betalningsmedel och investeringsalternativ. För att besvara dessa frågor undersöks korrelationskoefficienterna mellan bitcoin och elva andra tillgångar i kombination med en analys av en deskriptiv statistik. Med en undersökningsperiod som sträcker sig från 18 augusti 2011 till 17 mars 2017. Denna period har även delats upp i mindre tidsperioder för att utifrån detta analysera om det skett några förändringar i korrelationen mellan bitcoin och de traditionella tillgångarna i studien. Resultatet visade att bitcoin inte är korrelerad med andra traditionella tillgångar, oavsett vilken tidsperiod som undersöks. Det visade sig att bitcoin i förhållande till andra tillgångar är en riskfylld investering på grund av bland annat en hög volatilitet. Dock kompenseras detta av bitcoins höga årlig avkastning. Av resultatet framgår det även att volatiliteten för bitcoin har minskat med tiden och att kryptovalutan inte är lika riskfylld idag jämfört med tidigare.

Julie A. Maupin

No abstract is available for this record.

Dirk Andreas Zetzsche, Ross P. Buckley, Douglas W. Arner, Linus FFhr

No abstract is available for this record.

Azizah Aljohani

The rapid advancement in encryption and network computing gave birth to new tools and products that have influenced the local and global economy alike. One recent and notable example is the emergence of virtual currencies, also known as cryptocurrencies or digital currencies. Virtual currencies, such as Bitcoin, introduced a fundamental transformation that affected the way goods, services, and assets are exchanged. As a result of its distributed ledgers based on blockchain, cryptocurrencies not only offer some unique advantages to the economy, investors, and consumers, but also pose considerable risks to users and challenges for regulators when fitting the new technology into the old legal framework. This paper attempts to model the volatility of bitcoin using 5 variants of the GARCH model namely: GARCH(1,1), EGARCH(1,1) IGARCH(1,1) TGARCH(1,1) and GJR-GARCH(1,1). Once the best model is selected, an OLS regression was ran on the volatility series to measure the day of the week the effect. The results indicate that the TGARCH (1,1) model best fits the volatility price for the data. Moreover, Sunday appears as the most significant day in the week. A nontechnical discussion of several aspects and features of virtual currencies and a glimpse at what the future may hold for these decentralized currencies is also presented.

Julie A. Maupin

No abstract is available for this record.

Usman W. Chohan

No abstract is available for this record.

Thomas Linder, S. S. Meyer

Kryptowährungen wie Bitcoin verbreiten sich mit rasanter Geschwindigkeit. Der vorliegende Fachartikel zeigt auf, wie die Bitcoin-Thematik im Steuer- und Rechnungslegungsrecht einzuordnen ist und welche Fragen nach wie vor offen sind.

Floriane Bruneau

Following a trend of digitalization and happening after the subprime crisis, the Bitcoin event introduced the world to new possibilities regarding payment, data management and more importantly, the concept of decentralization: the possibility of building an organization without a central authority and managed by its users. \nBitcoin presents multiple innovative facets: the concept of cryptocurrency that is not submitted to any regulating authority, allowing free variations in value according to the market rule of supply and demand. The possibility of a new payment system suppressing all intermediaries, with the advantage of being faster, cheaper and more secure. But bitcoin, by being unregulated, consists of a very volatile currency and faces difficulty to inspire trust because of security matters, the bad image of an underground currency used for illegal purposes and finally the lack of recognition and trust that the financial institutions accord to it, making it a hazardous business. \nOn the other hand, blockchain benefits from a good reputation of fast, cheap and secure transactions, as well as a good potential for concrete businesses applications. But as Bitcoin, it faces trust matters and has the disadvantage of being too complex and costly to become a new norm in real economy transactions. \nIf both of these technologies have good principles, few are applicable to our system as it is now, but the principles that can be applied can change the face of our economy in the coming years; because of these two technologies, but also all the movement they generated around them in terms of innovation and inspiration for change

Tony Tran, Mats Levin

The rapid expansion of computer technology have forced several business sectors to integrate with the continuous development of techniques in order to assist them in various tasks. Many fields have happily embraced the technology implementing it in numerous ways, however the development speed have proven difficult to keep up with. The insurance industry have struggled with ridding themselves of old and monolithic legacy systems with a haphazard construction. These systems are costly, cumbersome and often reliant on a “third party” centered structure creating such flaws as data leaks and monopolisation. Blockchain is a distributed ledger operating over a peer-to-peer basis, with the intention to unshackle contemporary system from their dependence towards central authorities. Additionally, the peer-to-peer architecture introduced a new form of transparency which differs from contemporary solutions used in centralised systems, beyond the peer-to-peer architecture, the blockchain also incorporated consensus algorithms, allowing peers to verify one another to achieve consensus regarding the validity of each block. This resulted in a "trustless system" considering no single party in the community is dependent on the credibility of a central authority. In order for the blockchain technology to be applicable on the market it must overcome obstacles such as privacy and the new EU data protection regulation “General protection data regulation”. However a vague definition of personal data have caused ambiguity which appears to be irreconcilable with the blockchain technology. Research have therefore shifted its focus to explore opportunities for the technology to collaborate with techniques from centralisation in order to overcome its obstacles.

Cardozo Law Tech Talks

No abstract is available for this record.

Lene Standal, Julie H. Hageløkken

Bitcoin er en virtuell og desentralisert valuta som for første gang muliggjør betalinger direkte fra person til person, uten at betalingen må verifiseres av noen sentral, finansiell institusjon. Siden Bitcoin ble introdusert i 2008 har valutaen opplevd en betydelig økning i handelsvolum og vekslingskurs. Ingen tradisjonelle valutaer hadde en sterkere prisstigning enn Bitcoin i 2016, og antall kjøpte og solgte Bitcoin økte fra 40 milliarder euro i 2015 til 370 milliarder euro i 2016. I denne utredningen analyserer vi Bitcoins implikasjoner, og gjør rede for hvordan Bitcoin utfordrer skattemyndighetenes oppgaver. Utredningen viser at Bitcoins desentraliserte struktur på den ene side gir en rekke positive implikasjoner som gjør valutaen revolusjonerende; høyere grad av anonymitet i transaksjoner, lavere transaksjonskostnader, samt bidrar i kampen for å redusere fattigdom og politisk regulering. På den andre siden byr desentralisering og økt anonymitet på utfordringer som kan påvirke Bitcoins fremtid; vekslingskursen har hatt særdeles store svingninger, valutaen har blitt koblet til kriminalitet og bitcoinaktører har vært utsatt for sikkerhetsbrudd der Bitcoins er blitt stjålet. Videre viser vi hvordan Bitcoin og dens underliggende teknologi utfordrer skattemyndighetene, der utfordringene generelt er knyttet til at teknologien og Bitcoins egenskaper er relativt ukjent, og derfor kan synes å ligge et skritt foran skattemyndighetene. Avslutningsvis foreslår vi hvordan skattereglene for Bitcoin må tolkes, og utredningen gir dermed et i bidrag i avklaringen av en rekke skattemessige problemstillinger for bitcoinaktører og skattemyndigheter. Vår analyse av teori om etterlevelse og drøfting av Bitcoins egenskaper, tilsier at etterlevelsen av skattereglene må antas å være lav i bitcoinøkonomien. For å øke etterlevelsen bør noen av skattebestemmelsene for Bitcoin endres, og skattemyndighetene bør øke sin kunnskap om virtuelle valuta som Bitcoin. Dette er nødvendig for å kartlegge bedre kontrollmuligheter, gi bedre veiledning ut til skattytere og dermed forenkle skattleggingen av Bitcoin. Vi konkluderer med at Bitcoin har viktige implikasjoner som er revolusjonerende i utviklingen av ny og bedre betalingsteknologi. Det er likevel utfordringer som må løses for at Bitcoin skal anerkjennes av de store masser. I relasjon til skatt konkluderer vi med at omsetning av Bitcoin bør fritas fra merverdiavgift, ettersom merverdiavgiftsplikten har en rekke uheldige konsekvenser for norske bitcoinaktører og potensielt kan hindre videre utvikling av denne type teknologi.

Dr Craig S Wright

We demonstrate that the Bitcoin Script language allows not only for primitive recursion, but in the deployment of an Ackerman function and hence the ability to simply recurse in Bitcoin script, we show that the script system is Turing complete. From this, we introduce a new class of Turing Machine, the PTTM or probabilistic Total Turing machine and note that Bitcoin acts as a decider or Total Turing Machine which allows us to find a NIZKPoK that can act as a TM based verifier to a Non-Interactive Proof that is run on an external and non-associated TM as a proof system. Bitcoin can extend to securely offer contracts such as best fit solutions to common logistic systems and optimisation problems including the Travelling Salesman class of problems and to the optimisation of systems. This can be offered as an open or time bound contract that guarantees payment and can be solved which allowing Pseudonymity of the bidder.

Carina-Elena Stegăroiu

In the knowledge society, a new economy is emerging, New Economy, which also encompasses the Internet economy in the form of e-bussines, which is why the economy is the economy of information society and knowledge. So, in a knowledge-based technology, a new digital coin was also needed in the field of electronic payments, thus creating the virtual currency BITCOIN (BTC), which in a moto translation is the bit of the bit (the unit of measure of the amount of information). It is a decentralized electronic payment system and a digital encrypted opensurce created in 2009 by Satoshi Nakamoto. The need to create Bitcoin (BTC) was to ensure investment protection and free business finance, without resorting to financial institutions and beyond any constraints and regulations. The Bitcoin name also refers to the opensource program for using these coins, as well as the peer-to-peer (peer-to peer) network it forms. Currently, even if he has many opponents and has gone through several difficult times, Bitcoin seems to survive and offer new technology with revolutionary use possibilities. The concept of the digital coin fits perfectly with the ever-changing world, dominated by mobile and omnipresent technology. Compared to Bitcoin or another digital coin, any visit to the bank seems like a trip to another century, an era of time lost at the counter completing dozens of unnecessary papers.

Dominic Wörner

No abstract is available for this record.

Darcy W E Allen

No abstract is available for this record.

Randolph Robinson

In less than a calendar year, initial coin offerings or “ICOs” have become the fastest growing capital market in the world. In 2016, an entity called The DAO raised $160 million by selling crypto-tokens to over 15,000 individual purchasers around the globe. This massive fund raise would give rise to an entirely new capital ecosystem. In 2017, initial coin offerings would explode, raising a collective $3.5 billion in just the first three quarters of the year. All of this was done without a single registration being filed with the SEC, and many of these initial coin offerings — including several $100 million raises — were based on little more than a white paper and few lines of sample code. Welcome to the new Digital Wild West. With the seemingly overnight success of this new funding mechanism, there is little if any legal scholarship addressing initial coin offerings and how, or if, such offerings should be regulated. This article provides a non-technical legal audience with a foundational understanding of how the blockchain works, and the role initial coin offerings play in this new economic ecosystem. The overarching thesis of the article is that our current securities law framework, a framework that dates to the days of the great depression, is ill-equipped to handle this new world of decentralized, global, pseudonymous fund raises on public blockchains. Instead, governmental regulators should be working with core development teams to build a regulatory framework that integrates investor protections directly into the computer code governing these systems. By embracing “code as law,” both regulators and core development teams can protect the innovation being funded by initial coin offerings, while at the same time injecting some much needed investor protections into this new ecosystem. This article begins with an introduction to the coming decentralized world, including an overview of both public blockchain technology as well the Ethereum platform, the primary public blockchain upon which initial coin offerings are being deployed. Central to this introduction is an explanation of how the decentralization and disintermediation brought by the blockchain has the potential to dramatically reshape our economic and social systems. Next, the article explores the recent explosion of initial coin offerings, discussing how these offerings are structured, and how this new funding mechanism, if developed properly, has the promise of democratizing opportunities for economic innovation. The article then examines the SEC’s early statements on initial coin offerings to illustrate the potential problems with applying a dated legal framework to this new technology. Finally, the article concludes that the traditional securities law framework is ill suited for the coming decentralized world because the SEC’s enforcement power over global blockchain platforms is limited. Recognizing that external legal frameworks cannot be forced upon public blockchain platforms, the article argues for a collaborative process where governmental regulators work with core development teams to build a regulatory framework into the very fabric of these platforms, thereby providing investors protection, while at the same time embracing the concept of code as law.

Mikaela Sylven

Background: It is written much about the virtual currency in the media. Bitcoin is a virtual currency that is beginning to be used as payment for the purchase of goods and services. There are risks associated with virtual currencies just like traditional payments are, in some ways, these risks are similar, while they aredifferent in other ways. Purpose: The purpose of this study is to identify the risks that may arise when Bitcoin are used to make payments and to analyze how these risks can be managed. I will also analyze how Bitcoin works as payment. Method: Inthis study I has assumed an abductive method. The research approach has been made by triangulation where the aim is answered on the basis of a quantitative and qualitative approach. I have collect empirical data through a literature study, a survey and semi-structured interviews. Conclusion: Bitcoin is still in development stage, because of that I cannot make any conclusion on whether it will exist in the future. Bitcoin as payment is connected with a lot of possibilities in terms of businesses to gain a competitive advantage by offering Bitcoin as payment and financial institutions have a tougher competition. Other benefits of Bitcoin is that transaction costs are low and users' privacy is protected. Some disadvantages of Bitcoin is that it is in a legal gray area, high volatility, high entry barriers and low range of products and services. Keywords: Bitcoin, business, virtual currencies, risks, opportunities, benefits, crypto currency.

Usman W. Chohan

No abstract is available for this record.

Soumaya Ben Dhaou, Tatiana Zalan, Élissar Toufaily

According to the World Economic Forum, by 2025 10% of the world’s GDP (currently about $100 trillion) may be on blockchain. Blockchain technology is described as a distributed ledger technology (DLT) underpinned by five fundamental principles: decentralization, peer-to-peer transmission; transparency with pseudonymity; irreversibility of records; and computational logic. Despite blockchain’s transformative potential, it is unclear how Blockchain applications are implemented across industries and product/service categories. The purpose of the paper is to discuss the general challenges, risks, and implications related to blockchain implementation and adoption by the private and public sectors. We discuss how blockchain should overcome multiple barriers–technological, governance, organizational and social–for its widespread adoption. Mainly, the regulatory uncertainty, scalability and performance, interoperability, data privacy, security, legacy systems and the skills gap barriers to adoption are examined. Moreover, the socioeconomic implications of blockchain are discussed mainly the financial, economic, social and institutional impacts.

Marc Pilkington

No abstract is available for this record.

Hatim Hussain

Nearly twenty-five years ago, the internet disrupted the world and started a new era of technological supremacy. Today, with the rise of cryptocurrencies and its underlying technology we stand at the helm of another such revolution. Cryptocurrencies like bitcoin are peer-to-peer decentralized systems of digital currencies which operate without the need for a third-party intermediary like RBI. Coupled with lack of regulatory guidance, its unique technical aspects create huge complications in its taxation. While much ignorance still prevails in respect of cryptocurrencies, countries around the world have finally started taking notice and act upon it. This paper overviews the complete landscape of taxation of bitcoin-like cryptocurrencies. In this paper, an attempt is made to explain the indirect as well as direct tax structure concern cryptocurrencies, particularly after the implementation of Goods and Service Tax Act, 2017. The paper explains what bitcoins are, why are they important and whether it is necessary for the Government to regulate it. In addition, it discusses the prevailing regulatory structure as well as issues concerning evasionary practices in digital currencies. The findings help assess regulatory aspects in light of technological, economic, social and financial forces and establishes a set framework for taxation of cryptocurrencies.