Blockchain Papers

Ishfaque Ahmed Soomro, Suresh Kumar Oad Rajput, Najma Imtiaz Ali

No abstract is available for this record.

Alikhan Bulatov

The use of computationally intensive systems that employ machine learning algorithms is increasingly common in the field of finance. New state of the art deep learning architectures for time series forecasting are being developed each year making them more accurate than ever. This study evaluates the predictive power of the N-BEATS deep learning architecture trained on Bitcoin daily, hourly, and up-to-the-minute data in comparison with other popular time series forecasting methods such as LSTM and ARIMA. Prediction errors are measured with Mean Average Percentage Error (MAPE), and Root Mean Squared Error (RMSE). The results suggest that the developed N-BEATS model has promising predictive power compared to LSTM and ARIMA models.

Ting‐Yu Chen, Leh-chyan So

Since it was invented by Satoshi Nakamoto in 2008, Bitcoin has drawn considerable attention both from the financial industry and government supervisory departments, and there is no unanimity on Bitcoin’s nature in the academic field. Some people may think Bitcoin is more like an asset than a currency. And investors’ motivations for incorporating Bitcoin into their portfolios may vary. Might there be a better way to deal with the risk-detection issue associated with such a unique and ambiguous object? The copula-GARCH method has been proven in much of the literature to be a better way than the traditional ways to estimate the value at risk (VaR) of portfolios. When it comes to a portfolio containing Bitcoin, can it still maintain its superiority? In this study, gold and Ethereum were each used to construct a portfolio with Bitcoin. We collected a total of 2,246 daily adjusted closing prices from July 23, 2010, to March 12, 2019. As for the copula-GARCH model, we selected four constant and two time-varying copula models combined with GARCH Student-t residuals to fit the joint distribution of the two assets in the portfolios. The traditional methods refer to the historical simulation, the variance-covariance method, the EWMA method, and the univariate GARCH VaR method. We adopted each method to compute corresponding one-day VaRs. Our results indicated that for the portfolios containing Bitcoin and Ethereum, the copula-GARCH method performed better than traditional methods, while for the portfolio consisting of Bitcoin and gold, traditional methods performed better. Our results may suggest that the copula-GARCH method may not be suitable in the extremely low correlation case.

Marijana Srećković, Goran Šibenik, Thomas Preindl, Wolfgang Kästner · 5 authors

The increasing digitalization and thus evidently advancing change in the architecture, engineering and construction (AEC) industry, requires new business models, processes and strategies. Blockchain (BC), smart contracts and decentralized applications (DApps) are still underused in AEC. BC and its potential of inclusion into the communication between project stakeholders has shown that it is not just a technology that is ready to use, but requires a thorough insight into the design process of domain-specific stakeholders, their interests and their collaboration workflows for a holistic Building Information Modeling (BIM) and BC-supported solution for the design phase. This paper introduces process modeling of BIM-workflows in the design phase. We propose a conceptual framework for the implementation of a design process with BC based on the integration of three underlying theories: design theory, configuration theory and task-technology fit. The main assumption is, before we can capture processes (1) we need to understand them (design theory) in order to re-engineer them for distributed ledger technologies (DLT) (2) we need to adapt them to changing requirements (configuration theory), and finally (3) continually re-adjust Information Technology (IT) and processes interdependence (task-technology fit).

Rafael Genés-Durán, Diana Yarleque-Ruesta, Marta Bellés-Muñoz, Antonio Jimenez-Viguer · 5 authors

New manufacturing paradigms require a large number of business interactions between multiple cyber-physical systems with different owners. In this context, public distributed ledgers are disruptive because they make it possible to securely and publicly record proofs of agreements between parties that do not necessarily trust each other. Many industry leaders have already achieved significant business benefits using this technology, including greater transparency, improved traceability, enhanced security, increased transaction speed and costs reduction. While the benefits of blockchain technologies for industrial applications are unquestionable, these technologies have an inherent complexity that might be overwhelming for many users. To decrease entry barriers for industry users to distributed ledger technologies, it is necessary to have an easy user onboarding process and a simple key life-cycle management. In this paper, we propose an architecture that facilitates these processes and simplifies how users utilize decentralized applications without sacrificing on the expected security. To achieve this goal, our architecture uses a middleware that allows us to decouple the digital signatures required for paying blockchain fees from the ones required for authorization. This approach has the advantage that users are not forced to create wallets, buy cryptocurrency, or protect their private keys. For these reasons, our solution is a promising way of enabling a reasonable transition to the integration of distributed ledger technologies in industrial business processes.

Liang Tan, Na Shi, Caixia Yang, Keping Yu

Cyber-Physical-Social System (CPSS) big data is specified as the global historical data which is usually stored in cloud, the local real-time data which is usually stored in the fog-edge server (FeS) of the mobile terminal devices or sensors, and the social data which is usually stored in the social data server (SdS), moreover adopts a centralized access control mechanism to offer users' access strategy which can easily cause CPSS big data to be tampered with and to be leaked. Therefore, a blockchain-based access control scheme called BacCPSS for CPSS big data is proposed. In BacCPSS, account address of the node in blockchain is used as the identity to access CPSS big data, the access control permission for CPSS big data is redefined and stored in blockchain, and processes of authorization, authorization revocation, access control and audit in BacCPSS are designed, and then a lightweight symmetric encryption algorithm is used to achieve privacy-preserving. Finally, a credible experimental model on EOS and Aliyun cloud is built. Results show that BacCPSS is feasible and effective, and can achieve secure access in CPSS while protecting privacy.

Jaewon Noh, Sangil Jeon, Sunghyun Cho

Vehicular ad-hoc networks (VANETs) have several security issues such as privacy preservation, secure authentication, and system reliability. In the VANET, a vehicle communicates with other vehicles or infrastructures using broadcasting messages. These messages contain not only normal traffic information, but also identification information of sender. In general, the identification information remains encrypted to ensure privacy. However, the conventional centralized system can decrypt the identification information using private information of the sender vehicle. As a result, the central server can often be targeted by adversaries. We propose a message authentication scheme for anonymity and decentralization of information using blockchain technology. Here, we introduce public-private key and message authentication code (MAC) for secure authentication. In this paper, we adopt consensus algorithms for composing blockchain system such as the proof of work (PoW) and Practical Byzantine Fault Tolerance (PBFT) into the proposed authentication process. Finally, we demonstrate that the proposed method is secure from the attacks which include impersonation from internal attacker as well as typical attacks.

Chun‐Ta Li, Dong‐Her Shih, Chun-Cheng Wang, Chin‐Ling Chen · 5 authors

In recent years, due to the rapid development of information techniques and network technologies, more and more medical documents have been replaced by electronic files for sharing and transmitting in real time. However, medical data transmitted over public communication channels may suffer from security attacks and privacy threats. Blockchain technology has been gotten many attentions in different areas due to its unique properties such as anonymity, verifiability, immutability and decentralization. In order to secure patient privacy and provide more personal healthcare services, in this paper, we propose a data aggregation scheme based on Blockchain technology for medical environments. Moreover, in order to implement remote medical monitoring, we design a group authentication mechanism for multiple authorized users (such as patient, doctors, caregivers, family and friends) to freely access patient's personal health records. The authorized group members in a group will agree on a group session key and use it to protect patient's sensitive information. In case of a new member joins the medical group or an old member leaves the medical group, the group session key needs to be updated at any time. Finally, the electronic medical system will become more secure, reliable and useful by our proposed scheme.

Ziming Liu, Dazhi Wang, Jiaxing Wang, Xinghua Wang · 5 authors

The rapid growth of renewable energy has increased the requirements of the smart grid for communication and processing capabilities. As an effective solution to collect and manage information, the wireless network can improve the efficiency of renewable energy management. But due to the wireless data transmission risk and centralized power trading, the smart grid employing wireless networks cannot guarantee the security of the electricity market and the high consumption of renewable energy. Recently, as an emerging data-sharing technology, the blockchain has attracted widespread attention and is considered to have the potential to solve above problems. In this paper, we propose a blockchain-enabled secure power trading mechanism for the smart grid employing wireless networks. The blockchain is introduced to record power data collected by the wireless network, and the smart contract can make reasonable trading decisions based on this. The dual-chain structure composed of local energy trading blockchain and renewable energy trading blockchain improves the efficiency of power trading and renewable energy consumption. To strengthen the stability of renewable energy producers and expand their scale, we also design a blockchain-enabled renewable energy incentive mechanism. Finally, the modified Southern California Edison 56 bus test feeder model validated our mechanism.

Pei Huang, Kai Fan, Hanzhe Yang, Kuan Zhang · 6 authors

Cloud storage system provides data owners with remote storage service, which allows them to outsource data without local storage burden. Nevertheless, the cloud storage service is not fully trustworthy since it may not be honest and remote data would be corrupted. One way to ensure trustworthy preservation of cloud data is the remote data auditing method, through which data owners can check storage reliability of cloud system on demand and avoid potential data corruption in time. However, private auditing methods fail to promise the mutual trust in auditing results. Thus, public auditing methods are introduced, in which traditionally a third party auditor is delegated to interact with cloud service providers for auditing tasks. Although the third party auditor serves as a medium to exchange trust, a centralized third party is hard to stay neutral, which exposes the remote data auditing to some threats such as collusion attacks. To address the trust problem between data owners and cloud service providers, we propose a collaborative auditing blockchain framework for cloud data storage. In this framework, all consensus nodes substitute for the single third party auditor to execute auditing delegations and record them permanently, thereby preventing entities from deceiving each other. Security analysis shows that the proposed framework has advantage of preserving remote data integrity from various attacks. Performance analysis demonstrates that the framework is more functional and resource-friendly than existing schemes.

Anichur Rahman, Umme Sara, Dipanjali Kundu, Saiful Islam · 8 authors

The concept of Industry 4.0 is a newly emerging focus of research throughout the world. However, it has lots of challenges to control data, and it can be addressed with various technologies like Internet of Things (IoT), Big Data, Artificial Intelligence (AI), Software Defined Networking (SDN), and Blockchain (BC) for managing data securely. Further, the complexity of sensors, appliances, sensor networks connecting to the internet and the model of Industry 4.0 has created the chal-lenge of designing systems, infrastructure and smart applications capable of continuously analyzing the data produced. Regarding these, the authors present a distributed Blockchain-based security to industry 4.0 applications with SDN-IoT enabled environment. Where the Blockchain can be capable of leading the robust, privacy and confidentiality to our desired system. In addition, the SDN-IoT incorporates the different services of industry 4.0 with more security as well as flexibility. Furthermore, the authors offer an excellent combination among the technologies like IoT, SDN and Blockchain to improve the security and privacy of Industry 4.0 services properly. Finally , the authors evaluate performance and security in a variety of ways in the presented architecture.

Anichur Rahman, Md. Jahidul Islam, Ziaur Rahman, Md. Mahfuz Reza · 8 authors

Condominium network refers to intra-organization networks, where smart buildings or apartments are connected and share resources over the network. Secured communication platform or channel has been highlighted as a key requirement for a reliable condominium which can be ensured by the utilization of the advanced techniques and platforms like Software-Defined Network (SDN), Network Function Virtualization (NFV) and Blockchain (BC). These technologies provide a robust, and secured platform to meet all kinds of challenges, such as safety, confidentiality, flexibility, efficiency, and availability. This work suggests a distributed, scalable IoT-SDN with Blockchain-based NFV framework for a smart condominium (DistB-Condo) that can act as an efficient secured platform for a small community. Moreover, the Blockchain-based IoT-SDN with NFV framework provides the combined benefits of leading technologies. It also presents an optimized Cluster Head Selection (CHS) algorithm for selecting a Cluster Head (CH) among the clusters that efficiently saves energy. Besides, a decentralized and secured Blockchain approach has been introduced that allows more prominent security and privacy to the desired condominium network. Our proposed approach has also the ability to detect attacks in an IoT environment. Eventually, this article evaluates the performance of the proposed architecture using different parameters (e.g., throughput, packet arrival rate, and response time). The proposed approach outperforms the existing OF-Based SDN. DistB-Condo has better throughput on average, and the bandwidth (Mbps) much higher than the OF-Based SDN approach in the presence of attacks. Also, the proposed model has an average response time of 5% less than the core model.

Bozhi Wang, Qin Wang, Shiping Chen, Yang Xiang

The Tangle-based structure becomes one of the most promising solutions when designing DAG-based blockchain systems. The approach improves the scalability by directly confirming multiple transactions in parallel instead of single blocks in linear. However, the performance gain may bring potential security risks. In this paper, we construct three types of attacks with comprehensive evaluations, namely parasite attack (PS), double spending attack (DS), and hybrid attack (HB). To achieve that, we deconstruct the Tangle-based projects (e.g. IOTA) and abstract the main components to rebuild a simple but flexible network for the simulation. Then, we informally define three smallest actions to build up the attack strategies layer by layer. Based on that, we provide analyses to evaluate different types of attacks. To the best of our knowledge, this is the first study to provide a comprehensive security analysis of Tangle-based blockchains.

Jiawen Kang, Zehui Xiong, Chunxiao Jiang, Yi Liu · 9 authors

The emerging Federated Edge Learning (FEL) technique has drawn considerable attention, which not only ensures good machine learning performance but also solves "data island" problems caused by data privacy concerns. However, large-scale FEL still faces following crucial challenges: (i) there lacks a secure and communication-efficient model training scheme for FEL; (2) there is no scalable and flexible FEL framework for updating local models and global model sharing (trading) management. To bridge the gaps, we first propose a blockchain-empowered secure FEL system with a hierarchical blockchain framework consisting of a main chain and subchains. This framework can achieve scalable and flexible decentralized FEL by individually manage local model updates or model sharing records for performance isolation. A Proof-of-Verifying consensus scheme is then designed to remove low-quality model updates and manage qualified model updates in a decentralized and secure manner, thereby achieving secure FEL. To improve communication efficiency of the blockchain-empowered FEL, a gradient compression scheme is designed to generate sparse but important gradients to reduce communication overhead without compromising accuracy, and also further strengthen privacy preservation of training data. The security analysis and numerical results indicate that the proposed schemes can achieve secure, scalable, and communication-efficient decentralized FEL.

Tanweer Alam, Mohamed Benaida

In the next-generation computing, the role of cloud, internet, and smart devices will be capacious. Nowadays we all are familiar with the word smart. This word is used a number of times in our daily life. The Internet of Things (IoT) will produce remarkable different kinds of information from different resources. It can store and process big data in the cloud. The fogging acts as an interface between cloud and IoT. The IoT nodes are also known as fog nodes, these nodes are able to access anywhere within the range of the network. The blockchain is a novel approach to record the transactions in a sequence securely. Developing new blockchains based integrated framework in the architecture of the IoT is one of the emerging approaches to solving the issue of communication security among the IoT public nodes. This research explores a novel approach to integrate blockchain technology with the fog and IoT networks and provides communication security to the internet of smart devices. The framework is tested and implemented in the IoT network. The results are found positive.

Juan Ignacio Ibañez, Chris N. Bayer, Paolo Tasca, Jiahua Xu

During the last half century, the concept of shared ledger systems that offer a single source of truth has challenged traditional bookkeeping, leading to innovations such as the resource-event-agent (REA) accounting framework, triple-entry accounting (TEA), and blockchain. Despite these advancements, the historical development of shared ledger systems remains under-researched and unclear, with the influence of REA on TEA particularly overlooked. This study aims to fill this gap by conducting a genealogical analysis of shared ledger systems, with a focus on tracing the development of TEA and its historical byproduct of the REA framework designed by McCarthy. Through a comprehensive literature review and interviews with pioneers in REA, TEA, and blockchain, we uncover the missing link between REA and TEA. Our findings suggest that the current explosion of shared ledger systems results from the convergence of three parallel research streams, occasionally interacting with each other. We correct common misconceptions, acknowledge the influence of key individuals, and map out the overlapping paths of REA, TEA, and blockchain. By elucidating the historical evolution of shared ledger systems, this study contributes to the academic debate and fosters further discourse among researchers in REA, TEA, and blockchain, thereby enhancing the potential applications within these fields.

Iyolita Islam, Kazi Md. Munim, Shahrima Jannat Oishwee, A.K.M. Najmul Islam · 5 authors

Blockchain is relatively a new area of research. However, a surge of research studies on the blockchain has taken place in recent years. These research studies have mostly focused on designing and developing conceptual frameworks to build more reliable, transparent and efficient digital systems. While blockchain brings a wide variety of benefits, it also imposes certain challenges. Therefore, the objective of this research is to understand the properties of blockchain, its current uses, observed benefits and pitfalls to provide a balanced understanding of blockchain. A systematic literature review approach was adopted in this paper in order to attain the objective. A total of 51 articles were selected and reviewed. As outcomes, this research provides a summary of the state-of-the-art research studies conducted in the area of blockchain. Furthermore, we develop a set of concept maps aiming to provide in-depth knowledge on blockchain technology for its efficient and effective usage in the development of future technological solutions.

Neo C. K. Yiu

An interesting research problem in supply chain industry is evaluating and determining provenance of physical goods - demonstrating authenticity of luxury goods. Yet, there have been a few innovative software solutions addressing product anti-counterfeiting and record provenance of today's goods that are produced and transported in complex and internationally-spanning supply chain networks. However, these supply chain systems have been implemented with centralized system architecture, relying on centralized authorities or any form of intermediaries, and leading to issues such as single-point processing, storage and failure, which could be susceptible to malicious modifications of product records or various potential attacks to system components by dishonest participant nodes traversing along the supply chain. Blockchain technology has evolved from being merely a decentralized, distributed and immutable ledger of cryptocurrency transactions to a programmable interactive environment for building decentralized and reliable applications addressing different use cases and existing problems in the world. In this research, the Decentralized NFC-Enabled Anti-Counterfeiting System (dNAS) is proposed and developed, decentralizing a legacy anti-counterfeiting system of supply chain industry using Blockchain technology, to facilitate trustworthy data provenance retrieval, verification and management, as well as strengthening capability of product anti-counterfeiting in supply chain industry. The proposed dNAS utilizes decentralized blockchain network on a consensus protocol compatible with the concept of enterprise consortium, programmable smart contracts and a distributed file storage system to develop a secure and immutable scientific data provenance tracking and management platform on which provenance records, providing compelling properties on data integrity, are validated automatically.

Mikhail Mandrykin, Jake O’Shannessy, Jacob Payne, Ilya Shchepetkov

As smart contracts are growing in size and complexity, it becomes harder and harder to ensure their correctness and security. Due to the lack of isolation mechanisms a single mistake or vulnerability in the code can bring the whole system down, and due to this smart contract upgrades can be especially dangerous. Traditional ways to ensure the security of a smart contract, including DSLs, auditing and static analysis, are used before the code is deployed to the blockchain, and thus offer no protection after the deployment. After each upgrade the whole code need to be verified again, which is a difficult and time-consuming process that is prone to errors. To address these issues a security protocol and framework for smart contracts called Cap9 was developed. It provides developers the ability to perform upgrades in a secure and robust manner, and improves isolation and transparency through the use of a low level capability-based security model. We have used Isabelle/HOL to develop a formal specification of the Cap9 framework and prove its consistency. The paper presents a refinement-based approach that we used to create the specification, as well as discussion of some encountered difficulties during this process.

Tim Schmitz, Ingo Hoffmann

In this paper, we investigate whether mixing cryptocurrencies to a German investor portfolio improves portfolio diversification. We analyse this research question by applying a (mean variance) portfolio analysis using a toolbox consisting of (i) the comparison of descriptive statistics, (ii) graphical methods and (iii) econometric spanning tests. In contrast to most of the former studies we use a (broad) customized, Equally-Weighted Cryptocurrency Index (EWCI) to capture the average development of a whole ex ante defined cryptocurrency universe and to mitigate possible survivorship biases in the data. According to Glas/Poddig (2018), this bias could have led to misleading results in some already existing studies. We find that cryptocurrencies can improve portfolio diversification in a few of the analyzed windows from our dataset (consisting of weekly observations from 2014-01-01 to 2019-05-31). However, we cannot confirm this pattern as the normal case. By including cryptocurrencies in their portfolios, investors predominantly cannot reach a significantly higher efficient frontier. These results also hold, if the non-normality of cryptocurrency returns is considered. Moreover, we control for changes of the results, if transaction costs/illiquidities on the cryptocurrency market are additionally considered.

Justin D. Harris

Machine learning has recently enabled large advances in artificial intelligence, but these results can be highly centralized. The large datasets required are generally proprietary; predictions are often sold on a per-query basis; and published models can quickly become out of date without effort to acquire more data and maintain them. Published proposals to provide models and data for free for certain tasks include Microsoft Research's Decentralized and Collaborative AI on Blockchain. The framework allows participants to collaboratively build a dataset and use smart contracts to share a continuously updated model on a public blockchain. The initial proposal gave an overview of the framework omitting many details of the models used and the incentive mechanisms in real world scenarios. In this work, we evaluate the use of several models and configurations in order to propose best practices when using the Self-Assessment incentive mechanism so that models can remain accurate and well-intended participants that submit correct data have the chance to profit. We have analyzed simulations for each of three models: Perceptron, Naïve Bayes, and a Nearest Centroid Classifier, with three different datasets: predicting a sport with user activity from Endomondo, sentiment analysis on movie reviews from IMDB, and determining if a news article is fake. We compare several factors for each dataset when models are hosted in smart contracts on a public blockchain: their accuracy over time, balances of a good and bad user, and transaction costs (or gas) for deploying, updating, collecting refunds, and collecting rewards. A free and open source implementation for the Ethereum blockchain and simulations written in Python is provided at https://github.com/microsoft/0xDeCA10B. This version has updated gas costs using newer optimizations written after the original publication.

Gurpriya Kaur Bhatia, Shubham Gupta, Alpana Dubey, Ponnurangam Kumaraguru

Crowdsourcing is a process wherein an individual or an organisation utilizes the talent pool present over the Internet to accomplish their task. The existing crowdsourcing platforms and their reputation computation are centralised and hence prone to various attacks or malicious manipulation of the data by the central entity. A few distributed crowdsourcing platforms have been proposed but they lack a robust reputation mechanism. So we propose a decentralised crowdsourcing platform having an immutable reputation mechanism to tackle these problems. It is built on top of Ethereum network and does not require the user to trust a third party for a non malicious experience. It also utilizes IOTAs consensus mechanism which reduces the cost for task evaluation significantly.

Evans Rozario, Samuel Holt, James West, Shaun Ng

Cryptocurrency markets have many of the characteristics of 20th century commodities markets, making them an attractive candidate for trend following strategies. We present a decade of evidence from the infancy of bitcoin, showcasing the potential investor returns in cryptocurrency trend following, 255% walkforward annualised returns. We find that cryptocurrencies offer similar returns characteristics to commodities with similar risk-adjusted returns, and strong bear market diversification against traditional equities. Code available at https://github.com/Globe-Research/bittrends.

Federico Franzoni, Iván Abellán Álvarez, Vanesa Daza

Over the past twenty years, the number of devices connected to the Internet grew exponentially. Botnets benefited from this rise to increase their size and the magnitude of their attacks. However, they still have a weak point in their Command & Control (C&C) system, which is often based on centralized services or require a complex infrastructure to keep operating without being taken down by authorities. The recent spread of blockchain technologies may give botnets a powerful tool to make them very hard to disrupt. Recent research showed how it is possible to embed C&C messages in Bitcoin transactions, making them nearly impossible to block. Nevertheless, transactions have a cost and allow very limited amounts of data to be transmitted. Because of that, only messages from the botmaster to the bots are sent via Bitcoin, while bots are assumed to communicate through external channels. Furthermore, for the same reason, Bitcoin-based messages are sent in clear. In this paper we show how, using Bitcoin Testnet, it is possible to overcome these limitations and implement a cost-free, bidirectional, and encrypted C&C channel between the botmaster and the bots. We propose a communication protocol and analyze its viability in real life. Our results show that this approach would enable a botmaster to build a robust and hard-to-disrupt C&C system at virtually no cost, thus representing a realistic threat for which countermeasures should be devised.