Benjamin M. Blau, Todd G. Griffith, Ryan J. Whitby
This study examines the comovement between 17 of the most active cryptocurrencies. We are unable to statistically reject the presence of perfect comovement between Bitcoin and six of the 16 non-Bitcoin cryptocurrencies. Consistent with the friction-based explanation for the presence of comovement, once the CBOE introduced futures contracts on Bitcoin, we find that all 16 cryptocurrencies comove with Bitcoin. These results suggest that introducing futures contracts improves the informational environment of the entire cryptocurrency market, which helps explain the unusual comovement in the cryptocurrency market.
Aufgrund des Hypes um Bitcoin und Cryptocurrencys haben Blockchains in den letzten Jahren viel Aufmerksamkeit erhalten. Aber Cryptocurrencys sind bei weitem nicht die einzige Anwendung der Blockchaintechnologie. Smart Contract, also Applikationen die nach vordefinierten und unveränderbaren Regeln agieren, stellen eine weitere Anwendung dar. Solche Smart Contracts benötigen jedoch spezielle Platformen um ausgeführt werden zu können: so gennante Smart Contract Platforms. Die momentan meistverwendete Plattform is Ethereum, aber es gibt weitere Plattformen die interessante Alternativen darstellen. Eine vielversprechende dieser möglichen Alternativen is NEO. NEO ist in vielen Belangen ähnlich zu Ethereum, aber verspricht gleichzeitig einige Probleme zu lösen, mit denen sich Ethereum momentan konfroniert sieht wie zum Beispiel die schlechte Skalierbarkeit. Literatur, die sich mit den Unterschieden zwischen Ethereum and NEO befasst, ist spärlich. Vor allem NEO wird in der Literatur selten berücksichtigt, und falls NEO behandelt wird, dann passiert dies in der Regel nur oberflächlich. Außerdem haben die meisten Vergleiche und Evaluierungen von Smart Contract Plattformen beziehungsweise von Blockchains keine strukturierte Herangehensweise, sondern verwenden unterschiedliche Kriterien für unterschiedliche Plattformen. Das bedeutet, dass die meiste Literatur zu diesem Thema eine Übersicht der Plattformen darstellt, aber wenig Hilfe bei der Auswahl von Smart Contract Plattformen liefert. Diese Arbeit schließt diese Lücke, indem sie einen detalierten Vergleich von Ethereum und NEO durchführt. Um eine strukturierte Herangehensweise zu gewährleiten, wird in dieser Arbeit ein Kriterienkatalog basierend auf Kritierien in wissenschaftlicher Literatur abgeleitet. Dieser Kriterienkatalog wird anschließend auf die beiden Plattformen Ethereum und NEO angewandt um die für den Vergleich notwendigen Daten zu erhalten, die dazu dienen, die relevanten Gemeinsamkeiten und Unterschiede zwischen Ethereum und NEO zu identifieren. Des weiteren ermöglicht dies eine Diskussion über die Auswirkungen dieser Unterschiede. Die Ergebnisse der Arbeit zeigen, dass obwohl Ethereum und NEO auf den ersten Blick sehr ähnlich zu sein scheinen, diese doch markante Unterschiede aufweisen. Die Unterschiede reichen vom allgemeinen Ziel der Plattform über die Reife der Dokumentation und Plattformfeatures bis hin zu praktischen Kritierien wie den Kosten für die Erstellung von Smart Contracts.
This research proposes a new method of data synchronization between public blockchain networks and local machines. We discussed the proposed algorithm, and the mathematical model which achieves the shortest delay required for data synchronization. Tests were conducted to verify the correctness of the proposed model. Then a comparison is made with the current available classical synchronization methods. Suggested method may be useful for future DApps applications on Ethereum network.
Seit der Einführung der Peer-to-Peer Währung Bitcoin sind viele ähnliche Projekte vorgestellt worden. Ein beliebtes Projekt heißt Ethereum, welches erlaubt, Smart Contracts in seinem Netzwerk einzusetzen. Diese Contracts können von NutzerInnen entwickelt werden, um die Fähigkeit von Ethereum zu erweitern. Um mit diesem System interagieren zu können, wird eine Client-Software benötigt, die Blockchain-Daten herunterlädt und anschließend validiert. Als Blockchain wird die Datenstruktur bezeichnet, welche alle getätigten Transaktionen im Netzwerk speichert. Da eine große Menge an Daten kontinuierlich generiert werden, ist Ethereum auf schwächeren Computern nicht mehr einsetzbar. Aus diesem Grund vertraut man sich einer Drittpartei an, dass die heruntergeladenen Daten valide sind, um den zeitaufwendigen Validierungschritt zu umgehen. Eine Alternative, die nicht die Validierung aller Daten benötigt, wird Simplified Payment Verification (SPV) genannt, welche nur ein Teil der Blockchain verarbeiten muss. Software dieser Art nennt man auch Light Clients. Allerdings ist auch dieses Verfahren zu rechenintensiv für Ethereum. Erst vor Kurzem wurde ein kryptografisches Verfahren namens FlyClient vorgestellt, welches eine schnellere Validierung verspricht. Jedoch existiert bislang noch keine praktische Implementierung. Es stellt sich also die Frage, wie man die Validierung der Ethereum Blockchain auf schwächeren Computern wieder ermöglichen kann. Eine Motivation liegt in der praktischen Anwendung, wie beispielsweise Zahlungen per Smartphone tätigen zu können. Bei sicherheitsrelevanten Anwendungen ist es von Vorteil, nicht von einer Drittpartei abhängig zu sein. Das Ziel dieser Arbeit ist daher die systematische Untersuchung von existierenden Verfahren, um Light Clients zu entwickeln. Der Fokus liegt besonders auf einer Schonung von Systemressourcen und die Vermeidung einer Drittpartei. Es werden existierende Ethereum Anwendungen und deren inbegriffenen Sicherheitsannahmen untersucht. Ein Ethereum Light Client Prototyp wird entwickelt, welcher den FlyClient-Ansatz verwendet. Es wird gezeigt, dass mit einer einfachen Modifikation der Ethereum Blockchain Light Clients entwickelt werden können, die: (1) Payment Channels unterstützen, (2) eine effiziente Verifikation der Blockchain ermöglichen, (3) in einer dezentralen Art und Weise arbeiten, (4) hohe Sicherheitsgarantien bieten, und (5) auf schwächeren Computern, wie Smartphones oder IoT-Geräten, eingesetzt werden können.
Building on an economic model of rational Bitcoin mining, we measured the carbon footprint of Bitcoin mining power consumption using feed-forward neural networks. We found associated carbon footprints of 2.77, 16.08 and 14.99 MtCO2e for 2017, 2018 and 2019 based on a novel bottom-up approach, which (i) conform with recent estimates, (ii) lie within the economic model bounds while (iii) delivering much narrower prediction intervals and yet (iv) raise alarming concerns, given recent evidence (e.g., from climate–weather integrated models). We demonstrate how machine learning methods can contribute to not-for-profit pressing societal issues, such as global warming, where data complexity and availability can be overcome.
We formulate an optimal hedging problem of Bitcoin inverse futures under the minimum-variance framework. We obtain the optimal hedging strategy in closed forms for both short and long hedges and compute hedging effectiveness under the optimal strategy. Our empirical analyses show that the optimal hedging strategy achieves superior effectiveness in reducing risk and outperforms the naïve hedge in all scenarios.
Giuseppe Sciumè, Emilio José García, Pierluigi Gallo, Eleonora Riva Sanseverino · 6 authors
The use of Distributed Ledger Technologies such as Blockchain for certifying Demand Response services allows for the creation of a distributed system in which customers can communicate with the system operator to provide their flexibility, in a secure, transparent and traceable way. Blockchain technology also supports incentive mechanisms for users taking part in the service through the generation of utility tokens to recognize the user's contribution. This paper presents the experimental test of a novel methodology for Demand Response programs implementation by using the Blockchain technology. The latter is employed for defining a distributed Demand Response service and a new system for its tracing and certification. For this work, a Smart Contract has been conceived and written to execute Demand Response events, calculate users' baseline, compute the support provided by each user towards the fulfilment of the requested load curve modification and remunerate each user with utility tokens proportionally to their contribution. To test the methodology, a Hyperledger Fabric network and a Smart Contract were deployed on four nodes of the Microgrid Laboratory of the Department of Energy Technology at Aalborg University (DK). Subsequently, a realistic scenario comprising two consumer nodes was developed using power electronic converters for generating the household profiles and Smart Meters for the measurement of the consumption profiles. Theoretical and experimental results show the feasibility of Distributed Ledger Technologies in smart grids management with a minimum investment in new hardware while enabling the active participation of customers in Demand Response more transparently and fairly.
Bao Nguyen, E. Laxmi Lydia, Mohamed Elhoseny, Irina V. Pustokhina · 8 authors
In present digital era, an exponential increase in Internet of Things (IoT) devices poses several design issues for business concerning security and privacy. Earlier studies indicate that the blockchain technology is found to be a significant solution to resolve the challenges of data security exist in IoT. In this view, this paper presents a new privacy-preserving Secure Ant Colony optimization with Multi Kernel Support Vector Machine (ACOMKSVM) with Elliptical Curve cryptosystem (ECC) for secure and reliable IoT data sharing. This program uses blockchain to ensure protection and integrity of some data while it has the technology to create secure ACOMKSVM training algorithms in partial views of IoT data, collected from various data providers. Then, ECC is used to create effective and accurate privacy that protects ACOMKSVM secure learning process. In this study, the authors deployed blockchain technique to create a secure and reliable data exchange platform across multiple data providers, where IoT data is encrypted and recorded in a distributed ledger. The security analysis showed that the specific data ensures confidentiality of critical data from each data provider and protects the parameters of the ACOMKSVM model for data analysts. To examine the performance of the proposed method, it is tested against two benchmark dataset such as Breast Cancer Wisconsin Data Set (BCWD) and Heart Disease Data Set (HDD) from UCI AI repository. The simulation outcome indicated that the ACOMKSVM model has outperformed all the compared methods under several aspects.
Open access
Blockchain Technology Applications and Security
Privacy-Preserving Technologies in Data
Advanced Steganography and Watermarking Techniques
Ahsan Manzoor, Max Samarin, David Mason, Mika Ylianttila
Distributed Ledger Technology, has been gaining enormous attention in areas beyond cryptocurrency. Industries such as energy, transportation, and healthcare are already integrating DLTs into their operations. On the other hand, recent advances and the increasing popularity of the Internet of Things (IoT) technologies are also enabling new and exciting ways of interaction and sensing for mobile device users. Mobile gaming is another prominent industry that can be benefited from these technological developments and has the potential to create business opportunities. In this paper, we explore the uses of Distributed Ledger Technology in Mobile Gaming and for this purpose, we have taken a location-based IoT mobile gaming use case and propose new gaming features for the players by the addition of the DLT. We propose a platform for creating and playing scavenger hunt games using low-power BLE beacons. It allows smartphones to interact with the predetermined real-world locations and players can observe the surrounding environment looking for “clues” in the game. At the end of a hunt, the player receives rewards that are stored on a distributed ledger as Non-Fungible Tokens (NFT) and can bring in-game advantages for the next hunts. The proposed system is implemented using off-the-shelf devices and IoT beacons. We implemented our hybrid architecture by using AWS Lambda, Hyperledger Fabric managed blockchain and DynamoDB. We performed multiple experiments measuring the time taken for the end-to-end process, IoT beacon response times and the throughput of the Fabric network. Using the performance results, we estimated the maximum number of active players that can be supported by the game. Finally, we discuss business opportunities and limitations of the proposed proof of concept.
With the rise in popularity of cryptocurrencies, distributed ledger technology is a term that has gained traction. The aim of this study is to review and comparethe distributed ledger technologies blockchain and directed acyclic graph, examining their internal structures as well as some platforms and existing areas of application. An implementation, the goal of which is to illustrate the components of a possible distributed ledger solution and how they might interact, has been made in the form of a smart contract deployed on a simulated distributed ledger network. To give some explanation to the foundations of distributed ledger technology, a brief overview is given on the topics of cryptography, underlying data structures, and the frameworks used in this study. The literature study has been conducted by collecting and reviewing primarily scientific articles on the topic of distributed ledger technologies and consensus algorithms, as well as white papers on selected distributed ledger platforms. The construction has been done using the framework Hyperledger Fabric. The result chapter reviews how the implemented smart contract fulfills the concrete goals. The study is concluded with a discussion regarding how distributed ledgers might possibly be used in thef uture, what might be done to further develop the implemented smart contract and some of the ethical concerns surrounding distributed ledger technology.
Muhammad T. Afzal, Qi Huang, Waqas Amin, Khalid Umer · 6 authors
Existing work in energy demand side management focuses on the interaction between the utility grid and consumers. However, the previous technique is not focused on energy trading in local community of a renewable energy generation, distributed demand side management and not suitable for real-time environment. This paper presents a distributed demand side management system among multiple homes in community microgrid, with the integration of the internet of things smart meter and in the presence of renewable energy sources. The proposed energy consumption game is formulated for minimizing the cost of electricity in the individual home and the total cost of energy consumption in the whole community. The smart home users are playing game by optimizing their own daily energy consumption of appliances. The multiple participants include the self renewable generation of users, shared community microgrid and optional utility company. Each participant applies its best strategy to minimize energy consumption cost and users can maintain their own privacy of energy consumption. Moreover, the proposed scheme is distributed on blockchain, which provides a trusted communication medium between the participants. It enforces the autonomous monitoring of smart appliances and the billing of electricity consumption via smart contracts. Solidity smart contract is deployed to facilitate the execution of transactions without the involvement of third party in the smart community. Comparison of the results show that the proposed approach minimizes the total cost of energy consumption as well as each user's energy consumption cost.
In recent years, blockchain has received increasing attention and numerous applications have emerged from this technology. A renowned Blockchain application is the cryptocurrency Bitcoin, that has not only been effectively solving the double-spending problem but also it can confirm the legitimacy of transactional records without relying on a centralized system to do so. Therefore, any application using Blockchain technology as the base architecture ensures that the contents of its data are tamper-proof. This paper uses the decentralized Blockchain technology approach to ensure that consumers do not fully rely on the merchants to determine if products are genuine. We describe a decentralized Blockchain system with products anti-counterfeiting, in that way manufacturers can use this system to provide genuine products without having to manage direct-operated stores, which can significantly reduce the cost of product quality assurance.
Rabiya Khalid, Nadeem Javaid, Ahmad Almogren, Muhammad Umar Javed · 6 authors
Local energy generation and peer to peer (P2P) energy trading in the local market can reduce the energy consumption cost, emission of harmful gases (as renewable energy sources are used to generate energy at user's premises) and increase the smart grid resilience. However, local energy trading with peers can have trust and privacy issues. A centralized system can be used to manage this energy trading but it increases the overall cost of the system and also faces several issues. In this paper, to implement a hybrid P2P energy trading market, a blockchain-based system is proposed. It is fully decentralized and allows the market members to interact with each other and trade energy without involving a third party. Smart contracts play a very important role in the blockchain-based energy trading market. They contain all the necessary rules for energy trading. We have proposed three smart contracts to implement the hybrid electricity trading market. The market members interact with the main smart contract, which requests P2P and prosumer to grid smart contracts for further processing. The main objectives of this paper are to propose a model to implement an efficient hybrid energy trading market while reducing cost and peak to average ratio of electricity.
As a kind of point-to-point distributed public ledger technology, blockchain has been widely concerned in recent years. The privacy protection of blockchain technology has always been the core issue of people's attention. In this paper, some existing solutions to the current problems of user identity and transaction privacy protection are surveyed, including coin mixing mechanism, zero knowledge proof, ring signature and other technologies. Secondly, five typical applications of privacy protection technology based on blockchain are proposed and analyzed, which are mainly divided into technology applications based on coin mixing protocol, encryption protocol, secure channel protocol and so on. Finally, in view of the shortages of the existing blockchain privacy protection technology, we explore future research challenges that need to be studied in order to preserve privacy in blockchain system, and looks forward to the future development direction.
In this research, the evolution of Distributed Ledger Technology (DLT) in supply chains has been mapped from the inception of the technology until June 2020, utilising primarily public data sources. Two hundred seventy-one blockchain projects operating in the supply chain have been analysed on parameters such as their inception dates, types of blockchain, stages reached, sectors applied to and type of organisation that founded the project. We confirm generally understood trends in the blockchain market with the creation of projects following the general hype and funding levels in the industry. We observe most activity in the Agriculture/Grocery sector and the Freight/Logistics sector. We see the shift of market interest from primarily private companies (startups) to public companies and consortia and the change in blockchain adoption from Ethereum to Hyperledger. Finally, we observe higher success and lower failure rates for Hyperledger-based projects in comparison to Ethereum-based projects.
Decentralized techniques are becoming crucial and ubiquitous with the rapid advancement of distributed ledger technologies such as the blockchain. Numerous decentralized systems have been developed to address security and privacy issues with great dependability and reliability via these techniques. Meanwhile, formalization and verification of the decentralized systems is the key to ensuring correctness of the design and security properties of the implementation. In this paper, we propose a novel method of formalizing and verifying decentralized systems with a kind of extended concurrent separation logic. Our logic extends the standard concurrent separation logic with new features including communication encapsulation, environment perception, and node-level reasoning, which enhances modularity and expressiveness. Besides, we develop our logic with unitarity and compatibility to facilitate implementation. Furthermore, we demonstrate the effectiveness and versatility of our method by applying our logic to formalize and verify critical techniques in decentralized systems including the consensus mechanism and the smart contract.
Pavlos Papadopoulos, Nikolaos Pitropakis, William J. Buchanan, Owen Lo · 5 authors
The Domain Name System (DNS) was created to resolve the IP addresses of the web servers to easily remembered names. When it was initially created, security was not a major concern; nowadays, this lack of inherent security and trust has exposed the global DNS infrastructure to malicious actors. The passive DNS data collection process creates a database containing various DNS data elements, some of which are personal and need to be protected to preserve the privacy of the end users. To this end, we propose the use of distributed ledger technology. We use Hyperledger Fabric to create a permissioned blockchain, which only authorized entities can access. The proposed solution supports queries for storing and retrieving data from the blockchain ledger, allowing the use of the passive DNS database for further analysis, e.g. for the identification of malicious domain names. Additionally, it effectively protects the DNS personal data from unauthorized entities, including the administrators that can act as potential malicious insiders, and allows only the data owners to perform queries over these data. We evaluated our proposed solution by creating a proof-of-concept experimental setup that passively collects DNS data from a network and then uses the distributed ledger technology to store the data in an immutable ledger, thus providing a full historical overview of all the records.
Several states have recently changed their business organization law to accommodate autonomous businesses—businesses operated entirely through computer code. A variety of international civil society groups are also actively developing new frameworks— and a model law—for enabling decentralized, autonomous businesses to achieve a corporate or corporate-like status that bestows legal personhood. Meanwhile, various jurisdictions, including the European Union, have considered whether and to what extent artificial intelligence (AI) more broadly should be endowed with personhood to respond to AI’s increasing presence in society. Despite the fairly obvious overlap between the two sets of inquiries, the legal and policy discussions between the two only rarely overlap. As a result of this failure to communicate, both areas of personhood theory fail to account for the important role that socio-technical and socio-legal context plays in law and policy development. This Article fills the gap by investigating the limits of artificial rights at the intersection of corporations and artificial intelligence. Specifically, this Article argues that building a comprehensive legal approach to artificial rights—rights enjoyed by artificial people, whether corporate entity, machine, or otherwise—requires approaching the issue through a systems lens to ensure that the legal system adequately considers the varied socio-technical contexts in which artificial people exist. To make these claims, this Article begins by establishing a terminology baseline, and emphasizing the importance of viewing AI as part of a socio-technical system. Part I then concludes by reviewing the existing ecosystem of autonomous corporations. Parts II and III then examine the existing debates around artificially intelligent persons and corporate personhood, arguing that the socio-legal needs driving artificial personhood debates in both contexts include: protecting the rights of natural people, upholding social values, and creating a fiction for legal convenience. Parts II and III also explore the extent to which the theories from either set of literature fits the reality of autonomous businesses, illuminating gaps and using them to demonstrate that the law must consider the socio-technical context of AI systems and the socio-legal complexity of corporations to decide how autonomous businesses will interact with the world. Ultimately, the Article identifies and leverages links between both areas of legal personhood to demonstrate the Article’s core claim: developing law for artificial systems in any context should use the systems nature of the technical artifact to tie its legal treatment directly to the system’s socio-technical reality.
Licensing is one of the essential means of exploiting the monetary value of a musical work, and yet it is an area fraught with many issues and transactional costs which make it a difficult process for individuals and organizations. Many issues in music licensing arise from the legal complexity (e.g., national and international copyright law), business complexity (authentication, tracking, accounting, etc.), value web complexity (transparency of relationships among stakeholders), and technical complexity (e.g., establishing a global repertoire database for music, sufficient metadata standards) of working with music. Then, in addition to these issues, there are specific transactional costs (identification, negotiation, monitoring, and enforcement) associated with the licensing process. To mitigate the complexity and transactional costs associated with music and the licensing process, researchers and technologists have been investigating how new technologies and design models from the Web3 space, such as blockchain, linked data and Ricardian Contracts, can automate processes to reduce complexity, speed up payments, improve tracking, and provide other benefits in the music industry. In our report, we make our own attempt to reduce the complexity and transactional costs in the licensing process by developing an automated music license. In doing so, we first conducted a literature review scoping the intersection of music complexity and Web3 technologies to provide background and context to automating music licensing. Then we developed the Practical Tokenized Drafting (PTD) method, a set of core principles and practices for drafting Ricardian Contracts that interact with Web3 technologies (RC-Web3 Templates), and the Tokenized Music License (TML), an RC-Web3 Template standard form for music licensing on the OpenLaw platform. Both the PTD and TML can be adapted to meet the needs of music industry stakeholders and provide guidance to legal practitioners in drafting RC-Web3 Templates.
In connection with the expiration, in 2020, of basic regulatory and legal acts coordinating the implementation of the decentralization, it is needed to actualize and determine further directions of reform of the public finance management system. The purpose of the article is to determine efficient methods and directions of further improvement of the financial equalization system in Ukraine in order to form progressive local budget resource model, which by more balanced socio-economic development of municipalities will meet the needs of the population. The article addresses the essence and main components of financial equalization as a tool of budget regulation. The contents of the fiscal imbalance, horizontal and vertical equalization, evolution of methods of removal of fiscal disparities are highlighted. A European approach to overcoming the effects of the unequal distribution of potential sources of the financing of expenditures of bodies of local self-government is characterized. Features and invariance of reform of the public finance management system on the basis of decentralization, renewal of the financial equalization mechanism are considered. As a result of research, the effects (achievements and shortcomings) of the functioning of tools of vertical and horizontal equalization in the budget system of Ukraine implemented as a result of reform of fiscal decentralization, are analyzed. Basic recommendations aimed at further strengthening and establishing a stable local budgets base being a foundation for the whole budget system and a financial basis for local self-government, are proposed, on the strategy of improving the financial equalization mechanism that will provide achieving a balance of the interests of all participants in inter-budgetary relations.