Liudmila Zavolokina, Gianluca Miscione, Gerhard Schwabe
The second-hand automotive market is one with the least trust from consumers. Customers on the second-hand car market suffer from such problems as the car being in worse condition than initially indicated, accident damage that is not disclosed, fraud, etc. Akerlof, described the market for used cars as an example of the problem of information asymmetries and resulting quality uncertainty. In order to cope with quality uncertainties, used car buyers actively engage themselves in information seeking. Blockchain technology promises to automatize the tracking of cars through their lifecycles and provide reliable information at any point in time it is needed. In our study, we investigate the problems car buyers face during information seeking and propose requirements for the design of a blockchain-based system to address these.
The article discusses current approaches to determining the legal status of cryptocurrencies in order to create effective mechanisms of economic and legal support for their use in Ukraine. Attention is drawn to such a necessary factor as cooperation in the digital sphere between the state, individuals, and groups in the context of the «digital interdependence» paradigm, which was formulated at the #EuroDig2019 UN Digital Interdependence Report. The process of transformation of existing approaches to defining the economic and legal nature of cryptocurrencies by leading countries and international financial regulators is analyzed. The advantages and disadvantages of using cryptocurrencies have been systematized, as well as the genesis of such cryptocurrency as Bitcoin. It is determined that cryptocurrency is a new stage after the first electronic money, as well as the main advantages of its use, namely: instantaneous speed of payments (from a few seconds to several minutes); absence of transaction commission; anonymity of calculations; irreversibility of payments; no need to convert to the currency of the country of production of payments, a high degree of security of operations. The previous attempts of public authorities in Ukraine to establish a legal regime for the cryptocurrency market by adopting relevant regulatory legal acts in this area are analyzed. The ways of optimization of the legislation on cryptocurrencies in Ukraine are proposed in order to significantly enhance the innovative component of the Ukrainian economy and create competitive advantages for economic entities
Smart Sukuk structure is the new generation of Sukuk issuances structures. It uses Blockchain technology to allow more investors in both retail and corporate sectors to participate in Sukuk issuances. Through this technology, all financial institutions can issue their Sukuk. All types of documents and information related to the issuance of Sukuk are kept with the issuer's chains and the chains of the Central Registration Institution. Limited research was conducted on the transactions of smart Sukuk structures, such as Sukuk issuance model, traded Sukuk transactions and committed transactions market, from the Sharia compliance perspective and its financing benefits. This paper presents an in-depth study of the AAOIFI Standards, the decisions of Islamic Jurisprudence Academies and Sharia Boards, that related the Sukuk structures, applied in the Islamic bank of the paper's study society and the transactions of smart contracts from Sharia compliance perspective. On the other hand, this paper presents how to apply proposed smart Sukuk structures models that use Blockchain technology and smart contracts, within the largest Islamic bank in Turkey, in order to find out its financing benefits. The research findings indicate that from the Sharia perspective there are some issues in some applicable Sukuk models, such as the issue of capital guarantees. The use of Blockchain technology in smart Sukuk structures reflects several benefits on the financing markets, as it gives more capacity to access to more investors and markets, faster processing capability, transparency, invariance, and low transaction cost.
Gianluca Miscione, Tobias Goerke, Stefan Klein, Gerhard Schwabe · 5 authors
Blockchain technology provides a distributed ledger and is based on a logic of peer to peer authentication. It gained prominence with the rise of cryptocurrencies but provides a much broader field of possible applications. While it has been originally closely linked to a libertarian agenda rejecting organizations, its developments have illustrated that this ideological framing is being reversed in practice. Based on contrastive empirical cases, the purpose of our paper is to discuss blockchain as an organizational technology. Its peculiar mode of governance, which we name ‘Hanseatic’, needs to mediate between the fluidity typical of Free and Open Source Software development and the immutability that use organizations adopt blockchain for.
Vero Estrada-Galiñanes, Racin Nygaard, Viktor Trón, Rodrigo Q. Saramago · 6 authors
Blockchain is the driving force behind a myriad of decentralized applications (dapps) that promise to transform the Internet. The next generation Internet, or web3, introduces a "universal state layer" to store data in p2p networks. Swarm, a native layer of the Ethereum web3 stack, aims at providing redundant storage for dapp code, data, as well as, blockchain and state data. Based on a diploma verification dapp use case, we share insights on the role of redundancy strategies in designing a reliable storage layer. Our proof-of-concept improves Swarm's resilience to failures by balancing repairs and storage, with a slightly added latency.
Hossein Mohammadi Rouzbahani, Hadis Karimipour, Ali Dehghantanha, Reza M. Parizi
Power systems are growing rapidly, due to the ever-increasing demand for electrical power. These systems require novel methodologies and modern tools and technologies, to better perform, particularly for communication among different parts. Therefore, power systems are facing new challenges such as energy trading and marketing and cyber threats. Using blockchain in power systems, as a solution, is one of the newest methods. Most studies aim to investigate innovative approach-es of blockchain application in power systems. Even though, many articles published to support the research activities, there has not been any bibliometric analysis which specifies the research trends. This paper aims to present a bibliographic analysis of the blockchain application in power systems related literature, in the Web of Science (WoS) database between January 2009 and July 2019. This paper discusses the research activities and performed a detailed analysis by looking at the number of articles published, citations, institutions, research areas, and authors. From the analysis, it was concluded that there are several significant impacts of research activities in China and the USA, in comparison to other countries.
Charlie Hou, Mingxun Zhou, Yan Ji, Phil Daian · 7 authors
Incentive mechanisms are central to the functionality of permissionless blockchains: they incentivize participants to run and secure the underlying consensus protocol. Designing incentive-compatible incentive mechanisms is notoriously challenging, however. As a result, most public blockchains today use incentive mechanisms whose security properties are poorly understood and largely untested. In this work, we propose SquirRL, a framework for using deep reinforcement learning to analyze attacks on blockchain incentive mechanisms. We demonstrate SquirRL's power by first recovering known attacks: (1) the optimal selfish mining attack in Bitcoin [52], and (2) the Nash equilibrium in block withholding attacks [16]. We also use SquirRL to obtain several novel empirical results. First, we discover a counterintuitive flaw in the widely used rushing adversary model when applied to multi-agent Markov games with incomplete information. Second, we demonstrate that the optimal selfish mining strategy identified in [52] is actually not a Nash equilibrium in the multi-agent selfish mining setting. In fact, our results suggest (but do not prove) that when more than two competing agents engage in selfish mining, there is no profitable Nash equilibrium. This is consistent with the lack of observed selfish mining in the wild. Third, we find a novel attack on a simplified version of Ethereum's finalization mechanism, Casper the Friendly Finality Gadget (FFG) that allows a strategic agent to amplify her rewards by up to 30%. Notably, [10] show that honest voting is a Nash equilibrium in Casper FFG: our attack shows that when Casper FFG is composed with selfish mining, this is no longer the case. Altogether, our experiments demonstrate SquirRL's flexibility and promise as a framework for studying attack settings that have thus far eluded theoretical and empirical understanding.
In the late 1980s and early 1990s the electronic markets hypothesis offered a prediction about effect of information technology on industrial organisation, and many business writers forecast significant changes to the shape and nature of the firm. However, these changes did not come to pass. This paper provides an economic analysis of why, using the transaction cost economic framework of Ronald Coase and Oliver Williamson. Non-hierarchical corporate organisation struggled against contracting problems in the presence of possible opportunistic behaviour. Technologies of trust offer an institutional mechanism that acts on the margin of trust, suppressing opportunism. The paper concludes that blockchain technology provides an economic infrastructure for the coordination of economic activity and the possible realisation of the electronic markets hypothesis.
We propose a mean field game model to study the question of how centralization of reward and computational power occur in Bitcoin-like cryptocurrencies. Miners compete against each other for mining rewards by increasing their computational power. This leads to a novel mean field game of jump intensity control, which we solve explicitly for miners maximizing exponential utility and handle numerically in the case of miners with power utilities. We show that the heterogeneity of their initial wealth distribution leads to greater imbalance of the reward distribution, and increased wealth heterogeneity over time, or a “rich get richer” effect. This concentration phenomenon is aggravated by a higher Bitcoin mining reward and reduced by competition. Additionally, an advantaged miner with cost advantages such as access to cheaper electricity, contributes a significant amount of computational power in equilibrium, unaffected by competition from less efficient miners. Hence, cost efficiency can also result in the type of centralization seen among miners of cryptocurrencies. This paper was accepted by Kay Giesecke, finance. Funding: A. M. Reppen is partly supported by the Swiss National Science Foundation [Grant SNF 181815]. Supplemental Material: The data files are available at https://doi.org/10.1287/mnsc.2023.4798 .
Volkan Dedeoglu, Ali Dorri, Raja Jurdak, Regio A. Michelin · 7 authors
Cyberphysical Systems (CPS) are transforming the way we interact with the physical world around us. However, centralised approaches for CPS systems are not capable of addressing the unique challenges of CPS due to the complexity, constraints, and dynamic nature of the interactions. To realize the true potential of CPS, a decentralized approach that takes into account these unique features is required. Recently, blockchain-based solutions have been proposed to address CPS challenges.Yet, applying blockchain for diverse CPS domains is not straight-forward and has its own challenges. In this paper, we share our experiences in applying blockchain technology for CPS to provide insights and highlight the challenges and future opportunities.
We define and analyze three mechanisms for getting common knowledge, a posteriori truths about the world onto a blockchain in a decentralized setting. We show that, when a reasonable economic condition is met, these mechanisms are individually rational, incentive compatible, and decide the true outcome of valid oracle queries in both the non-cooperative and cooperative settings. These mechanisms are based upon repeated games with two classes of players: queriers who desire to get common knowledge truths onto the blockchain and a pool of reporters who posses such common knowledge. Presented with a new oracle query, reporters have an opportunity to report the truth in return for a fee provided by the querier. During subsequent oracle queries, the querier has an opportunity to punish any reporters who did not report truthfully during previous rounds. While the set of reporters has the power to cause the oracle to lie, they are incentivized not to do so.
The idea of smart home existed from 1970's onwards but has come into the knowledge of researchers and data scientist due to the development in the domain of internet of things (IoT) (Kopetz, 2011), but it still suffers from privacy and security vulnerabilities. Conventional security policies or approaches are not applicable to IoT, mainly due to its decentralised topology and the resource constraints of the majority of its devices (Dorri et al., 2017a). This Paper presents an innovative, novel and decentralised approach that can be used to augment the existing security architecture of a smart home network. Our scheme guarantees both trustworthiness and user privacy preservations.
El presente trabajo aborda el estudio de la primera criptomoneda lanzada al mercado como nuevo metodo de pago. Se realizo una revision bibliografica acerca del origen de su creacion, crecimiento, evolucion y grado de aceptacion dentro del mercado de nuevos activos financieros. Se prosiguio con la revision documental sobre sus principales caracteristicas, su evolucion legal y financiera, apoyada en fuentes secundarias, especialmente en los informes de revistas especializadas en el tema y de plataformas de inversion y pagos. Como resultados se identifican los avances de la moneda como la primera red financiera criptografica descentralizada del mundo, asi como las experiencias especificas de su evolucion de crecimiento que dieron origen a la creacion de la Fundacion Bitcoin, fortaleciendo el vinculo entre la moneda y su aceptacion como activo financiero innovador. El Bitcoin ofrece un nuevo mecanismo de pago que ha tenido un crecimiento sostenido y esta generando un nuevo relacionamiento financiero, en donde la baja participacion de intermediarios permite obtener menores precios en las transacciones. La metodologia a utilizar es la cualitativa, tipo documental – bibliografico que busca como objetivo destacar la importancia de conocer el comportamiento del Bitcoin, su crecimiento en el volumen de transacciones y su valor en el mercado financiero desde su creacion en el 2.009 hasta el 2017.
OBJECTIVE: To facilitate clinical/genomic/biomedical research, constructing generalizable predictive models using cross-institutional methods while protecting privacy is imperative. However, state-of-the-art methods assume a "flattened" topology, while real-world research networks may consist of "network-of-networks" which can imply practical issues including training on small data for rare diseases/conditions, prioritizing locally trained models, and maintaining models for each level of the hierarchy. In this study, we focus on developing a hierarchical approach to inherit the benefits of the privacy-preserving methods, retain the advantages of adopting blockchain, and address practical concerns on a research network-of-networks. MATERIALS AND METHODS: We propose a framework to combine level-wise model learning, blockchain-based model dissemination, and a novel hierarchical consensus algorithm for model ensemble. We developed an example implementation HierarchicalChain (hierarchical privacy-preserving modeling on blockchain), evaluated it on 3 healthcare/genomic datasets, as well as compared its predictive correctness, learning iteration, and execution time with a state-of-the-art method designed for flattened network topology. RESULTS: HierarchicalChain improves the predictive correctness for small training datasets and provides comparable correctness results with the competing method with higher learning iteration and similar per-iteration execution time, inherits the benefits of the privacy-preserving learning and advantages of blockchain technology, and immutable records models for each level. DISCUSSION: HierarchicalChain is independent of the core privacy-preserving learning method, as well as of the underlying blockchain platform. Further studies are warranted for various types of network topology, complex data, and privacy concerns. CONCLUSION: We demonstrated the potential of utilizing the information from the hierarchical network-of-networks topology to improve prediction.
Alevtina Dubovitskaya, Petr Novotny, Zhigang Xu, Fusheng Wang
BACKGROUND: Timely sharing of electronic health records across providers, while ensuring data security and privacy, is essential for prompt care of cancer patients, as well as for the development of medical research and the enhancement of personalized medicine. Yet, it is not trivial to achieve efficient consent management, data exchange, and access-control policy enforcement, in particular, in decentralized settings, and given the gravity of the condition such as cancer. Using blockchain technology (BCT) has been recently advocated by research communities and gained momentum from the industry perspective. However, most of the proposed solutions are at the level of a prototype, and blockchain-based healthcare data management systems are not in place yet. SUMMARY: This paper presents a systematic literature review, aiming to analyze the motivations, advantages, and limitations, as well as barriers and future challenges faced when applying the state-of-the-art distributed ledger technology in oncology. We then discuss its outcomes and propose the direction of the future research that can help to attain integration and adoption of the BCT for data-sharing, medical research, and the pharmaceutical supply chain in oncology, as well as in healthcare in general. Key Messages:BCT has the potential to enhance data-sharing (for primary care and medical research), as well as to attain optimization of the pharmaceutical supply chain by bringing properties such as transparency, traceability, and immutability to the applications. However, BCT itself cannot guarantee data privacy and security. Thus, it is never proposed as a stand-alone technology, but as a combined technology with cryptographic techniques. Regardless of the number of existing prototypes of blockchain-based healthcare systems, due to the existing barriers of the adoption (e.g., legal, social, and technological limitations), there is a lack of evaluation in real-world settings. Aiming to overcome these limitations, we propose future research directions that include design of the privacy-preserving hybrid data storage, interoperable infrastructures and architecture, and are compliant with the international laws and regulations.
Ikhlaas Gurrib, Qian Long Kweh, Mohammad Nourani, Irene Wei Kiong Ting
This study analyses whether returns of top market capitalised cryptocurrencies are affected by their movements or major global macroeconomic news. Daily data are collected for the leading 10 cryptocurrencies from July 2017–December 2018. This study, (i) tests whether lagged variables can help predict other variables’ returns through a vector autoregression (VAR) model, (ii) analyses the response of cryptocurrencies to one standard deviation shock on Bitcoin’s returns, and (iii) decomposes factors that contribute to variance and tests for structural breaks. Findings show that most cryptocurrencies do not significantly affect other variances, except for Monero, which represented between 19% and 45% of the variances of five cryptocurrencies. Autoregressive (AR) models are superior in forecasting one day ahead return forecasts, compared to the VAR model, whereas the random walk (RW) model ranked last. Although remarkable structural breaks are observed via impulse response functions during December 2017–January 2018, no major news announcements were released on the same day the breaks occurred. Overall, this study suggests the need for high-frequency cryptocurrency prices to tackle the issue of the relationship between intraday news release and cryptocurrencies.
Distributed ledger technology and IoT has revolutionized the world by finding its application in all the domains. It promises to transform the digital infrastructure which powers extensive evolutions and impacts a lot of areas. Vehicle parking is a major problem in major cities around the world in both developed and developing countries. The common problems are unavailability or shortage of parking spaces, no information about tariff and no mean of searching availability of parking space online. The struggle doesn't end even if an individual finds a spot, he is required to pay in cash. This traditional and manual process takes a lot of time and causes a lot of hassle. In this paper, we provide a novel solution to the parking problem using IoT and distributed ledger technology. This system is based on pervasive computing and provides auto check-in and check-out. The user can control the system and their profile using the app on their smartphone. The major advantage of the system is an easy and online payment method. Users can pay for their parking tickets using their credit cards from their smartphone app. This decreases their hassle of carrying cash and coins for purchasing parking tickets. Smart Parking will optimize the parking mechanism, save time, reduce traffic and pollution, and provide an enhanced user experience. It is robust, secure, scalable and automated using the combination of cutting-edge technologies.
IoT emerges as an unprecedented paradigm with great potential for changing how people interact, think and live. It is making existing Internet services feasible in ways that were previously impossible, as well as paving the way for new situation-awareness applications suitable for smart cities, such as realtime video surveillance, traffic control, and emergency management. These applications will typically rely on large numbers of IoT devices to collect and collaboratively process streamed data to enable real-time decision making. In this paper, we introduce the concept of Semantic Virtual Space (SVS), an abstraction for virtualized cloud-enabled IoT infrastructure that is commensurate with the goals and needs of these emerging smart city applications, and propose and discuss scalable architectures and mechanisms that enable and automate the deployment and management of multiple SVS instances on top of the cloud-enabled IoT infrastructure.
Óscar Lage, Santiago de Diego, Borja Urkizu, Eneko Gómez · 5 authors
Blockchain has been widely known thanks to Bitcoin and the cryptocurrencies. In this chapter, we analyze different aspects that relate to the application of blockchain with techniques commonly used in the field of cybersecurity. Beginning by introducing the use of blockchain technology as a secure infrastructure, the document delves into how blockchain can be useful to achieve several security requirements, common to most applications. The document has been focused on some specific cybersecurity disciplines to maintain simplicity: backup and recovery, threat intelligence and content delivery networks. As illustrated, some projects and initiatives are in the process of joining these two fields to provide solutions to existing problems.
The development of information technology requires humans in modern times to adjust. Various modern payment instruments have been designed so that they can be used as a means to facilitate transactions. In addition to e-money, in recent years a virtual currency has emerged, known as cryptocurrency. In this paper, researchers formulated the problem form, including: comparison of Japanese and Singapore cyrptocurrency laws, payment systems in Indonesia at this time and then compared the prospects for the development of cryptocurrency whether it can be implemented in Indonesia in facing the globalization of the world. This research was conducted using a normative research method which was then compared to written regulations, theories, journals obtained from library materials. The current legal conflict faced by the State is that virtual currencies are not allowed to transact in Indonesia by the government. So this research was conducted with the aim of analyzing comparative law studies related to the prospects for the development of cryptocurrency in Indonesia, as well as examining whether cryptocurrency arrangements could be made in Indonesia.
Amir Teshome Wonjiga, Sean Peisert, Louis Rilling, Christine Morin
Migrating an application from local compute resources to commercial cloud resources involves giving up full control of the physical infrastructure, as the cloud service provider (CSP) is responsible for managing the physical infrastructure, including its security. The reliance of a tenant on a CSP can create a trust issue around whether the CSP is upholding its end of the bargain. CSPs acknowledge this and provide a guarantee through a Service Level Agreement (SLA). SLAs need to be verified for satisfaction of the defined objectives. To avoid raising the trust issue again, such a verification procedure needs to be unbiased and independently achievable by both tenants and CSPs without one relying on the other party. In this paper, we consider an SLA offered by the provider that guarantees the integrity of tenants' data, and propose to verify the SLA using an integrity checking method based on a distributed ledger. Our proposed method allows both CSPs and tenants to perform integrity checking without one party relying on the other. The method uses a blockchain as a distributed ledger to store evidence of data integrity. Assuming the ledger as a secure, trusted source of information, the evidence can be used to resolve conflicts between providers and tenants. In addition, we present a prototype implementation and an experimental evaluation to show the feasibility of our verification method and to measure the time overhead.
Elena B. Zavyalova, Ekaterina I. Shumskaia, Alexandra I. Shumskaia
Introduction. Smart contracts have become demanded agreements in the modern market with the development of crypto-currency due to their ability to provide and guarantee enforcement. To date they are performed automatically using blockchain technology. Smart contracts are the subject of debate in many countries, primarily because issues have arisen in their legal enactment in the field of regulation of digital assets and the legal recognition of blockchain technology itself, which determined the purpose of this scientific research. For the purpose of a deeper understanding of the essence of this type of agreements, a historical method has been applied in the work on the features of the formation of smart contracts. To identify key differences, a formal legal and comparative analysis of smart contracts with classical contracts in electronic form was carried out. The areas of application of smart contracts in the world and in Russia, such as banking, healthcare, insurance and public services, were also studied. Materials and methods. The methodological basis of the study was made up of the following general scientific and special methods of cognition of legal phenomena and processes, including systemic, historical, formal legal, comparative and analytical approaches. Results. An assessment is made of such contracts from the point of view of the existing civil law of the Russian Federation and further directions for study and development are proposed, including the improvement of the regulatory and institutional environment to maintain legal certainty. Discussion and conclusion. The existing legal regulation does not prohibit the use of smart contracts in the business practices of companies and individuals. But the simplicity of the transaction implementation algorithm built on the blockchain still requires some legal support.
We propose BlockLot, a blockchain based verifiable lottery. BlockLot provides transparent, immutable, fair, and verifiable lottery services enhanced by recent blockchain technologies such as append-only (replicated) distributed ledger and smart contract. In addition, BlockLot allows all participants to perform various verification to ensure that the system is actually working as expected. We implement BlockLot services which includes open, query, subscribe, and draw in smart contracts. We also develop webbased user interface for using the lottery services provided by BlockLot. The web interface allows the user to verify the lottery as well.