Authors research the current problem of innovative development — digitalization of financial assets. They review the key aspects of organizing the information system operator using the distributed ledger technology. The main imperative requirements of the legislation for operators of the information system are highlighted. The main alternatives of IT-infrastructure creation are considered. Also the matters of operational risks management and organizational and economic efficiency of activities are revealed.
Modern decentralized technologies, such as distributed registries, blockchain, smart contracts and decentralized autonomous organizations (DAO), are becoming more popular every year. Therefore, the subject of our research, the results of which are presented in this article, is the processes of digitalization in the field of management control and key technologies that allow to organize an effective system of management control in a decentralized organization. The success of management control is determined not only by its ability to identify and correct undesirable deviations in a timely manner, but also by the presence of a special corporate culture based on trust and fairness. Moreover, a positive corporate culture reduces the need for a number of control procedures designed to compensate for the lack of trust within the company. This effect can also be seriously enhanced by modern digitalization technologies. The research methodology included a broad review of literature sources and a comparative analysis of modern concepts of decentralized management, as well as drawing conclusions about promising ways to evolve management control systems. The aim of the study is to identify the impact on management control systems of modern technologies such as blockchain, smart contracts and decentralized autonomous organizations. The authors summarized the experience of applying these technologies in management control systems, which are designed to ensure high individual and team performance to achieve the strategic goals of the company. The conclusion is that the blockchain-based decentralized autonomous organization (DAO) is changing the forms and methods of management control, increasing the role of collective decisions and opening the way for employee initiative. DAO can significantly reduce internal and external transaction costs, including costs associated with the management and operation of management control systems. Different procedures for approval, confirmation and verification, as well as the adoption of standard management decisions are unified and automated. Accordingly, the time and the total amount of effort spent by managers to perform routine actions related to monitoring and control of employees' actions is reduced. Decentralization of control also reduces the impact of administrative procedures and ensures a higher level of trust within the organization. The decentralized model of management control is relevant for various areas of business and management, but special prospects can be seen in the field of decentralized finance (DeFi), where a wide range of professional controllers and users can be involved in auditing smart contracts and identifying shortcomings in financial services.
Nov 8, 2020·CEUR Workshop Proceedings, Vol-2732: Proceedings of the 16th International Conference on ICT in Education, Research and Industrial Applications. Integration, Harmonization and Knowledge Transfer. Volume II: Workshops
Hanna Kucherova, Dmytro Ocheretin, Vita Los, Natalia Venherska
Research goals and objectives: to study the series of dynamics of the frequency of requests and the price of bitcoin under the conditions of taking into account the risks of using various forecasting methods. Subject of research: proof of importance of the role, statistical dependence and interdependence of the series of dynamics of the price of bitcoin and the frequency of its online requests. Research methods used: analytical methods, econometric models, nonlinear dynamics methods. Results of the research: The research grounded the approach and the forecasting procedure for the series of dynamics of the price of bitcoin and the frequency of its online requests, which in essence correspond to the basic principles of the implementation of the forecasting methodology, take into account the specifics of the formation of the frequency of online requests for bitcoin prices and the socio-economic meaning of its functioning. The practical value consists in determining that the minimum risks for the study of a time series dynamics of bitcoin price and frequency of requests for bitcoin price were demonstrated by the neural network methodology in comparison with the use of the ARIMA model and other methods of economic and mathematical modeling that proves the proposed methodology for determining the direction of the trend outside the study period.
Umar Aptievich Bachaev, Eliza Aptievna Abdulazizova
This article reveals the economic content of the cryptocurrency, which has recently become widely known and spread. The system of direct payments was a response to the global financial crisis, the consequences of which have shaken the financial system of many countries. The authors analyze the scientific achievements of foreign and domestic scientists, which allows to identify a number of advantages and disadvantages of the new currency based on information. Along with the technological superiority in this direction, there are still questions concerning methodological, methodological and legal components of the cryptocurrency. Bitcoin is characterized by decentralization: a special program code regulates the work of the network members, as well as the schedule of emission, which is limited in itself, because the generation of coins is closed and the number of PTSs is constant. The introduction of cryptocurrency has a number of other positive effects: irreversible transactions, low transfer fees, complete isolation of the currency from inflation, etc. At the same time, the cryptocurrency has negative consequences. For example, the inability to track remittances and the vulnerability of the system create the preconditions for illegal operations: money laundering, capital flight, terrorism, etc. Another negative feature of the cryptocurrency is its dependence on supply and demand. Thus, the legal status of the cryptocurrency in many countries, including Russia, is not fully defined due to its ambiguous attitude. However, it should be admitted that its appearance on the world market is a phenomenon that in theory can fundamentally change the existing financial system.
Oct 26, 2020·CEUR Workshop Proceedings, Vol-2713: Proceedings of the Selected Papers of the Special Edition of International Conference on Monitoring, Modeling & Management of Emergent Economy (M3E2-MLPEED 2020)
Current research has led to a rejection of the hypothesis of a normal distribution of financial assets returns. Under these conditions, portfolio variance cannot serve as a good risk measure. In this paper analyzed the daily returns of the most common cryptocurrencies: Bitcoin, Ethereum, XRP, USDT, Bitcoin Cash, Litecoin. It is shown that the asset returns are not normally distributed, but with good precision follow the Cauchy distribution and Laplace distribution. The analytical expressions for risk measure were obtained using the distribution function and the VaR technique. However, the risk assessment of the return obtained on the basis of the Cauchy distribution is twice as high as the risk assessment obtained on the basis of the Laplace distribution. Therefore, the question arises: what distribution law to use to measurement the cryptocurrency risk? The paper shows that the Laplace distribution is the most adequate basis for measuring of cryptocurrencies risk.
The aim of the article is to clarify the basics of the digitalization strategy of the competitive businesses and identify features of the institutional environment that ensure the development of cryptocurrency as a new asset (IT product) of the modern economy, analyze the methods of implementing the cryptocurrency business models. The relevance of the research paper is determined by the need to develop a competitive Russian cryptocurrency (including the cryptoruble) with the growing private, state and cross-national cryptocurrencies. The scientific novelty of the study implies clarifying the informal and formal rules of the institutional environment and related methods ensuring the development of a competitive cryptocurrency. The authors consider the following methods to implement the institutional features of the cryptocurrencies business model development: logic and blockchain algorithm that establish trust and collaboration between cryptocurrency developers; logic and blockchain consensus algorithm ensuring that all the parties of the blockchain network come to a common agreement (consensus); logic and blockchain algorithms that form cryptocurrency transactions and control its turnover by generating blocks of cryptocurrencies, by forming the structure of blocks and transactions of cryptocurrencies, by storing cryptocurrencies’ keys and providing security, by mining (forging) cryptocurrency, etс.The results of the study provide a basis for identifying the institutional features and the corresponding methods providing a competitive cryptocurrency development with a detailed analysis of the blockchain consensus algorithms that ensure the competitiveness of the cryptocurrency. The conclusions show that the most promising are the hybrid consensus algorithms which may include both the logic of two or more known algorithms and the original logic of a new algorithm. The authors recommend defining the logic of the blockchain consensus algorithm as a priority when developing a cryptocurrency to ensure reliability of the transactions in the blockchain network, thus increasing the competitiveness of the cryptocurrency.
Objective: to consider the evolution of types and forms of money, to classify the varieties of cryptocurrency and its functions, to explain the mechanisms for issuing and circulation of cryptocurrencies, as well as to identify problems in the field of legal regulation of digital virtual currencies in the Russian Federation.Methods: the work used a dialectical combination of the principles of a systematic approach and various ontological knowledge through a range of methods of historical, empirical, comparative, logical, statistical and predictive cognition.Results: it is shown that the modern global monetary system is evolving towards decentralization; it is based on cryptocurrencies issued as part of a functional combination of public and private blockchains; cryptocurrencies require full legalization, not prohibition at the legislative level; cryptocurrencies are types of digital virtual assets accounted for on accounts (crypto wallets) identified within.Scientific novelty: for the first time, the article shows that it is erroneous to consider cryptocurrency to be just a property and to limit its operations just to cross obligations for transferred goods and rendered works (services). Cryptocurrencies are decentralized virtual money based on mathematical algorithms using open-source asymmetric cryptography techniques and consensus-based platforms. Users need both external (cryptocurrency) and internal (tokens) currencies to increase the efficiency of using traditional assets (property, goods and services) in the economy.Practical significance: the main provisions and conclusions of the article can be used to develop a glossary, terms and definitions of cryptocurrency, mechanisms for regulating its issue and circulation in Russia, as well as making amendments to the draft law “On digital currency and amendments to certain legislative acts of the Russian Federation” that are adequate to the economic nature of cryptocurrency.
The main purpose of the paper is to discuss the nature of the enterprise architecture of the blockchain platform (EAoBP). The authors also highlighted how the main technology challenges for enterprises are addressed through the proposed solution. The paper consists of the introduction and 3 chapters. Chapter 2 presents related works about the blockchain technology and defines the platform concept. The architecture layers which are required to build the enterprise blockchain platforms are described in the 3rd chapter. The 4th chapter constitutes the implementation aspects of the EAoBP. The permissioned blockchain systems leverage a cross-organizational collaboration model, what constitutes cooperation within the network without 3rd party authorities. The open source character of the implementation technology and the clear guidance of the scope of each layer clarified in the article should help businesses in applying the concept.
Aleksandr Erokhin, Konstantin Koshechkin, Ilya Ryabkov
BACKGROUND: In the modern world, millions of people suffer from fake and poor-quality medical products entering the market. Violation of the rules of transportation of drugs makes them ineffective and even dangerous. The relationship between the various parts of the supply chain, production and regulation of drugs is too hard and has many problems. Distributed ledger technology is a distributed database, the properties of which allow us to track the entire path of medical products from the manufacturer to consumer, to improve the current model of the supply chain, to transform the pharmaceutical industry and prevent falsified drugs reach the market. OBJECTIVE: The aim of the article is to analyze the distributed ledger technology as an innovative means of poor-quality pharmaceuticals prevention to reach the market as well as their forehanded detection. METHODS: Content analysis of web sites of companies developing distributed ledger technology solutions had been performed. Five examples found with a google search engine by keywords "distributed ledger technology", "blockchain", "pharmaceuticals" and "supply chain" were examined. Analysis of relative scientific publications had been made. With the help of generalization and systematization methods, services provided by these companies were analyzed. The visual model of the supply chain was created with Microsoft Visio software. RESULTS: The analysis results contain a principle scheme of distributed ledger technology implementation to achieve the objectives. The analysis of present-day pharmaceuticals supply chain structure and the distributed ledger technology capacities to improve pharmaceutical companies has been carried out and presented. Furthermore, the article allows getting acquainted with today's projects released to the market as well as the prognosis of the distributed ledger technology in pharmaceutical industry enhancement in the future.
In today’s modern energy sector, driven more and more towards decentralization, which includes many smaller energy producers rather than huge government projects, security against cyber-attacks is becoming more crucial for the energy grid. Since many small energy plants do not have the resources to finance very expensive existing cyber-security systems, they often have no security system in place at all. Although with small energy producers, the risks of being under attack are not as devastating as in a huge power plants, they still pose a serious threat to the energy system and to the supply of electricity to whole regions. Moreover, in the era of technology, such cyber-attacks could be carried out simultaneously at many locations, thus risking the lack of electricity to larger areas. Since there was a clearly identified need for such an instrument, the SPEAR consortium, started to develop tailor made solution for different types of actors in the energy sector, to prevent such occurrences and help secure the energy system. One of the use cases, investigated in the project, is a real operating hydro power plant in the mountain area of Bulgaria called Leshnitsa, which will be one of the four sites to first test the functionality of the finished product. The plant had no previous cyber-security system in place and had already experienced one attack, where one of the computers in the plant was hacked and a ransom was demanded from the attackers to unlock it. Exactly events like this one are proof, that the energy sector has a need to protect the growing number of small independent actors in the energy system..
Vasiliy Elagin, Anastasia Spirkina, Mikhail Buinevich, Andrei Vladyko
Over the past decade, wireless communication technologies have developed significantly for intelligent applications in road transport. This paper provides an overview of telecommunications-based intelligent transport systems with a focus on ensuring system safety and resilience. In vehicle-to-everything, these problems are extremely acute due to the specifics of the operation of transport networks, which requires the use of special protection mechanisms. In this regard, it was decided to use blockchain as a system platform to support the needs of transport systems for secure information exchange. This paper describes the technological aspects of implementing blockchain technology in vehicle-to-network; the features of such technology are presented, as well as the features of their interaction. The authors considered various network characteristics and identified the parameters that have a primary impact on the operation of the vehicle-to-network (V2N) network when implementing the blockchain. In the paper, an experiment was carried out that showed the numerical characteristics for the allocation of resources on devices involved in organizing V2N communication and conclusions were drawn from the results of the study.
The article explores the correlation strength of the ten most important cryptocurrencies, emphasizing the examination of differences during the periods of rising and falling prices. The daily and weekly returns of selected cryptocurrencies are taken as the basis for calculating and determining the correlation strength using the Pearson correlation coefficient. The survey covers the period from the beginning of 2017 to Bitcoin’s last local bottom in mid-March 2020. Research findings are as follows: 1) the most important cryptocurrencies are mostly moderately positively correlated with each other over time; 2) correlation strength decreases slightly during the bull period, but mostly remain in the range of moderate correlation; 3) correlation strength increases significantly during the bear period, with most cryptocurrencies strongly correlated with each other. The results do not change significantly if the daily or weekly cryptocurrency returns are used as the basis. A strong correlation in the period of falling prices prevents the effective diversification of the cryptocurrency portfolio, which must be considered when investing funds in the cryptocurrency market.
The article analysis the methodological justification of the digital transformation of logistics processes in transport chains formed by transport and logistics companies at the national and transnational levels, which own their own infrastructure, when switching to the technology of smart contracts. The research methodology is based on the provisions of the theory of logistics and supply chain management, the theory of process management and the design and technological concept of organizational culture formation. Based on the results of the established principles of transition to smart contract technology, digital transformation of processes, a logical and time structure of the methodology of engineering/reengineering of logistics business processes in transport chains was formed during the transition to smart contract technology, which provides the most complete coverage of methodological problems solved in the process of reengineering, their logical focus, as well as correlation with the time frame. The study presents a methodological tool and results of semantic modeling of logistics processes in transport chains that form the necessary basis for further algorithmization of procedures for fulfilling the contractual conditions of a smart contract. Based on the systematization of approaches to establishing the essential characteristics of smart contracts, their models are established, as well as the necessary conditions for the successful implementation of various smart contract models and possible transition scenarios are identified. The materials of the article are largely the result of close interaction with JSC “Russian Railways” in the course of preparing a methodological justification for the transition to the technology of smart contracts in transport chains, the logical processes in which are implemented using the railway infrastructure of JSC “Russian Railways”.
Open access
Economic and Technological Systems Analysis
Advanced Research in Systems and Signal Processing
This article aims to review economic advantages of the one of the most modern cutting edge technologies, namely blockchain for eProcurement. As eProcurement (including its part – Supply chain) is a concept consisting of plenty of different processes, therefore specific advantages per such major different processes are explained. Assumptions and pre-conditions of Blockchain application are explained. Article‘s main conclusion is that due to the main characteristics of Blockchain technology (safety, transparency, reliability, speed and cost efficiency) payment settlement and products‘ shipping tracking/inventory management are eProcurement‘s phases that could benefit from this technology the most, among others (such as analysis – requirements‘ gathering, sourcing/vendors‘ selection and contract management cycle).
Prompt development of information technology has made an essential impact on many industries. There appeared a concept "Industry 4.0" symbolizing the fourth industrial revolution. The given concept is closely connected with such promising technologies as the Internet of Things, blockchain, fog computing, Big Data. In the present research, the sphere of the mining industry is examined. We discuss the possibility to increase the efficiency of mining enterprises at the expense of the development of common information space based on modern digital technologies. We analyze security problems at the level of data flow between the participants of the production process on a mining enterprise. We define the problem of providing the reliability of data on the production course on mining enterprise in the conditions of the possible connection loss between the control center and separate technological units. We offer a new approach to the solution of the given problems, based on the technology of blockchain and digital watermarking. The computing experiment is conducted presenting a possibility to implement the offered approaches on common models of microcontrollers.
E. L. Pankratov, Vladimir Grigoryev, Oleg E. Pankratov
Abstract Based on the study of existing practice and specific examples of the use of innovative blockchain technology in real estate transactions and its management, the article gives the basic concepts of this technology, analyzes foreign and domestic experience of its application, examines its sphere of use in the real estate market, substantiates main advantages and shortcomings, as well as the process of various mechanisms for financing real estate transactions. It was revealed that when using the blockchain system, all real estate transactions proceed faster, safer and cheaper. Thus, the objectives of the article include studying and summarizing the Russian and foreign practices of using blockchain technology, as well as determining the main ways and options for its further development and improvement, as a highly effective and promising financial and economic mechanism for participants in real estate transactions.
Emerging technologies are always treated with caution, and Blockchain is no exception to this rule. The AECO (Architecture, Engineering, Construction, and Operations) sector is considered conservative when it comes to technology adoption, which is often positive in an industry that deals with a vital commodity that could harm humans or result in catastrophe. However, excessive caution also stifles innovation, as shown in the industry's low R&D expenditure when compared to other industrial activities. In recent years, the AECO sector has benefited from the adoption of new information management tools and systems that allow professionals to develop, share and store construction data more effectively. These tools have successfully tackled many of the traditional interoperability issues that have affected the industry, but several challenges remain unsolved. Indeed, effective real-world communication depends, not only on the compatibility between data formats and systems, but also on issues such as privacy, transparency, and trust. Blockchain has been adopted in different activities as a tool to address these issues, but its impact in the construction industry remains scarce. This paper presents a bibliometric study for the available literature on Blockchain implementation in the AECO sector. In addition to the bibliometric review, content analysis for the literature retrieved is presented to provide a clear vision of the current directions regarding Blockchain technology adoption. The purpose of this article is to evaluate the maturity of Blockchain in Construction literature using statistics based on the available bibliometrics in addition to content analysis. The main results show that although the number of articles about the use of Blockchain in Construction has increased, no studies that present ready to use solutions were found. Instead, the covered studies discuss the technical capabilities of the technology and suggest possible fields of implementation, such as smart contracts and automated payments. Study limitations include the limited amount of literature that can be found on major indexing services, which cover a relatively short reference period.
In this article, the author considers the role of distributed registries in improving the modern payment system. The essence of the distributed ledger mechanism is analyzed. The advantages and disadvantages of using distributed registries in the development and implementation of payment systems are identified.
Open access
Digitalization and Economic Development in Agriculture
Purpose . This paper aims to design the contract and present the profit distribution mechanism for CL platform, so as to realize the intelligent and automatic operation of the artificial intelligent- (AI-) based CL platform. Design/Methodology . A smart contract based on BT is designed for the AI-based CL platform. Profit distribution mechanism based on the Nash bargaining model for the CL platform is also put forward to coordinate different participators’ benefit relationship in CL. Findings . The AI-based CL platform and the proposed smart contract based on BT map the scenario which may be influenced by human factors and involve trust issues onto execution of codes. Practical Implications . The study will help CL practitioners in establishing effective profit mechanism and designing contracts on the platform, thus facilitating its sustainable operation. Originality/Value . The AI-based CL platform with BT smart contract can be totally free of human intervention, and hence, the problems of trust during CL platform’s operation are solved.
This article explores Blockchain Technology, and how it can be used in the context of information exchange between stakeholders in international supply chains and networks involving air transport. The article reviews the global experience with this technology of iconic companies (Maersk, Lufthansa, Walmart, Unilever, Nestle, Samsung, British Airways) in logistics and supply chain management. It highlights the features of international chains using air transport, which predominantly consist of two categories of goods: goods with high added value (electronic devices and their components, fashion industry products, jewelry) and goods with strict delivery time requirements (pharmaceuticals, live animals, perishable products, e-commerce products and mail). The study shows that perishable goods have great potential for increasing airline cargo turnover. However, at present, there is no single universal tool for managing their supply chains since the tools used (ERP, SRM, TMS, WMS) do not provide complete transparency of information exchange between all stakeholders. The most problematic stage in the delivery to control steps in the delivery of perishable goods by air occur on the ground, while goods are being handled at the airport of departure and the airport of destination. Difficulties arise while checking the correctness of paperwork, labeling and information authenticity about the product origin. The article suggests using block chain blockchain technology in combination with IoT and smart-contract technologies for SCM of perishable products using air transport. The use of this technology allows to reduce the time of document verification procedures. Customs clearance and phytosanitary control could be vastly improved. Overall tracking and monitoring of a product from the moment of its production to the destination simplifies the identification of any counterfeits, improves the quality of food safety control. A greater level of control becomes possible in logistics operations, to determine liability in possible delivery conditions’ violations cases. Overall optimization of the logistic processes, automatization of the execution of verified financial transactions can be achieved. The use of these technologies in combination with innovative technologies for food quality control will significantly reduce logistics costs in the supply chains of perishable products.
Maria Gorbunova, Aleksandr Ometov, Mikhail Komarov, Sergey Bezzateev
Introduction: Distributed ledger technology (DLT) is one of the most significant fields covering various aspects of modern ICT systems. Centralized systems of today can no longer guarantee the required level of availability and reliability, while broadly available distributed ones are still in the infancy. Purpose: Analysis of the applicability of DLT to various industries such as economics, energy, finance, logistics, and the Internet of Things. Results: The article outlines the main challenges of the DLT technology integration, such as the lack of a unified system for data storage, the need to ensure an appropriate level of data confidentiality, integration into the existing competency systems, the issues of а distributed system interaction with resource-constrained IoT devices, the lack of proper management tools for distributed systems, and network scalability. The main contribution of this paper is a systematic overview of the integration challenges followed by potential solutions and future perspectives.