PT PLN (Persero) as one of the state-owned companies in Indonesia, has the business of selling electricity as one of the core businesses of the company. Business. With customers in 2018 reaching 71.92 million customers, PT PLN (Persero) has entered into a power purchase and purchase contract with customers with the same number of 71.92 million customers. Smart Contracts are expected to be a substitute for written contracts because smart contracts do not require storage space for written documents and are safe from contract changes made by unauthorized parties because they are protected by cryptographic techniques.
In the situation of the Covid-19 plague, many organizations are raising funds to help local governments to obtain additional sources of funds that will be distributed to those in need. Trust is an important factor for the parties involved in raising these funds, both in terms of the funder, the service provider of fundraising platform and even the fundraiser. On this occasion, the author tries to analyze how to implement blockchain technology and smart contracts in the dominant schemes of crowdfunding process. the results of this study indicate that blockchain-based smart contracts can be applied to the dominant schemes of crowdfunding process.
Emerging technologies such as Internet of Things (IoT) and blockchain have affected the digital transformation. Blockchain, on the one hand, was initially developed for the purpose of financial trading due to its robustness especially for fault tolerance and cryptographic security in addition to its decentralized architecture. IoT, on the other hand, is an open interconnected network of smart devices able to communicate simultaneously. This arises a challenge in privacy and security, specifically for the data being exchanged. To overcome this, studies have focused on the blockchain to resolve the security and privacy issues of IoT. Indeed, limited studies have proposed to assess blockchain’s viability for IoT and the associated challenges. In this paper, a conceptual model has proposed to identify the crucial factors affecting the adoption of blockchain in IoT. The model consists of four dimensions of factors that we assume will affect the adoption of the two technologies. The dimensions are: attitude-related factors, social influence related factors, data-related factors, and security-related factors. This model is validated through a survey that was distributed between professionals in blockchain and IoT. The findings show a significant impact of data-related factors on the adoption of blockchain in IoT and the intention to use them. The model can play an important role in the development of strategies, standards, and performance assessment.
Bitcoin is widely used and accepted by many countries. The features that are being offered and the positive uprising of its price have made made it popular among its users and investors. The value of Bitcoin started from less than a dollar in 2009 and raking up to over two thousand dollar within 2017. In Indonesia, Bitcoin became popular in 2013; a group of people began to form a community and online forum where people with similar interest can gather and conduct exchange of Bitcoin. In early 2014, the community had formed the first professional Bitcoin brokerage service in Indonesia which also known as bitcoin.co.id and over fifty thousand members were registered. With the daily transaction valuing over five hundred million Rupiah, bitcoin.co.id has made its name on South East Asia. However, despite the positive response in Indonesia, the lack of legal framework regulating cryptocurrencyand the risk of misusing it to fund illicit activity has become a national concern. This paper provides an analysis of legal problems that are being encountered by Indonesia government and thorough comparison with America’s laws on cryptocurrency. By stipulating a law on cryptocurrency, Indonesia’s government would have show support for cryptocurrency in Indonesia through reducing the volatility risk and the possible illicit activities derived from the usage of cryptocurrency.
Primavera De Filippi, Morshed Mannan, Wessel Reijers
Blockchain technology was created as a response to the trust crisis that swept the world in the wake of the 2008 financial crisis. Bitcoin and other blockchain-based systems were presented as a “trustless” alternative to existing financial institutions and even governments. Yet, while the trustless nature of blockchain technology has been heavily questioned, little research has been done as to what blockchain technologies actually bring to the table in place of trust. This article draws from the extensive academic discussion on the concepts of “trust” and “confidence” to argue that blockchain technology is not a ‘trustless technology’ but rather a ‘confidence machine’. First, the article provides a review of the multifaceted conceptualisations of trust and confidence, and the relationship between these two concepts. Second, the claim is made that blockchain technology relies on cryptographic rules, mathematics, and game-theoretical incentives in order to increase confidence in the operations of a computational system. Yet, such an increase in confidence ultimately relies on the proper operation and governance of the underlying blockchain-based network, which requires trusting a variety of actors. Third, the article turns to legal, constitutional and polycentric governance theory to explore the governance challenges of blockchain-based systems, in light of the tension between procedural confidence and trust.
Dulani Jayasuriya Daluwathumullagamage, Alexandra Sims
There is considerable hype about blockchain in almost every industry, including finance, with significant investments globally. We conduct a systematic review of 851 records and construct a final article sample of 183 for the sample period 2012 to 2020 to identify relevant factors for blockchain adoption in corporate governance. We conduct textual and empirical analysis to develop a decentralized autonomous governance framework and link traditional corporate governance theories to blockchain adoption. Furthermore, we explore present and future use cases and implications of blockchains in corporate governance. Using our systematic review and textual analysis, we further identify gaps and common trends between prior academic and industry literature. Moreover, for our empirical analysis, we compile a unique database of blockchain investments to forecast future investments. In addition, we explore blockchain potential in corporate governance during and post COVID-19. We find prior academic articles to mostly focus on regulation (49 studies) and Initial Coin Offerings (ICOs) (46 studies), while industry articles tend to concentrate on exchanges (10 studies) and cryptocurrencies (9 articles). A significant growth in literature is observed for 2017 and 2018. Finally, we provide behavioural, regulatory, ethical and managerial perspectives of blockchain adoption in corporate governance.
Summary We provide a high‐level view on topics addressed in scientific articles about regulatory technology (RegTech), with a particular focus on technologies used. For this purpose, we first explore different denominations for RegTech and derive search queries to search relevant literature portals. From the hits of that information retrieval process, we select 55 articles outlining the application of information technology in regulatory affairs with an emphasis on the financial sector. In comparison, we examine the technological scope of 347 RegTech companies and compare our findings with the scientific literature. Our research reveals that ‘compliance management’ is the most relevant topic in practice, and ‘risk management’ is the primary subject in research. The most significant technologies as of today are ‘artificial intelligence’ and distributed ledger technologies such as ‘blockchain’.
Direct bartering allows for the trading of assets with or without the use of money. In this paper, we introduce a smart contract written in the Solidity language for the Ethereum blockchain that implements a distributed and autonomous direct barter exchange operated by crowds. Since ERC20 smart contract tokens are widely used for initial coin offerings (ICOs), our implementation provides autonomous bartering services for ERC20 tokens. The non-fungible ERC721 token, as well as Ethereum Name Service (ENS) name bartering, are also supported. Because finding a feasible bartering solution for bids involving multiple tokens is NP-hard in general, our exchange only provides escrow and swapping services. It assumes feasible solutions are submitted by bartering problem solvers from the crowd who run a solver locally on their machines. Bartering problem solvers are incentivized to submit solutions to the autonomous exchange by awarding them with excess tokens that are left over after granting the bidders the tokens they requested in their bids. Our system, called BarterMachine, can perhaps be used to facilitate a global barter economy. The BarterMachine prototype is available for testing on the Ethereum Ropsten network at https://bartermachine.github.io/bartermachine/ropsten/.
Corporations and other forms of business organizations can be supplemented with blockchain-based agency constructs. Blockchain-based decentralized autonomous organizations (DAOs) expand the definition of the firm. On-chain DAO governance enables dynamic regulatory features that facilitate unprecedented decentralized regulatory solutions.
Denni Arli, Patrick van Esch, Marat Bakpayev, Andrea Laurence
Purpose In this study, we focus on consumer perceptions of cryptocurrencies. We hypothesize that knowledge of cryptocurrencies, trust in government, and the speed of transactions are the main factors contributing to consumers' trust in cryptocurrencies. Design/methodology/approach 451 MTurk workers, a convenient sample incentivized with a small monetary payment, participated in a cross-sectional online study with cryptocurrencies serving as the focal product category. Findings We obtained support for our hypothesized notion that knowledge of cryptocurrencies, trust in government, and the speed of transactions are the main factors contributing to consumers' trust in cryptocurrencies. Our research makes several important theoretical contributions. First, we demonstrate that consumers who understand and know how cryptocurrencies work are more likely to trust and invest in the currency. Next, we demonstrate that consumers are more likely to trust cryptocurrencies and their peer-to-peer transactions if, preferably, they take place via a central issuer and are regulated by their respective governments. Originality/value This study is the first known paper to focus on cryptocurrencies from the consumers' perspective. Next, we identify key antecedents of trust towards cryptocurrencies. Second, we reveal the role of government concerning cryptocurrencies. Finally, FinTech firms and banks (should they choose to enter the cryptocurrency market) need not spend time and money on marketing, advertising, and promotions in order to try to allay consumers' anxiety when it comes to their uptake in the different digital currencies. Rather, this would allow the FinTech firms and banks to allocate resources to focus their attention on marketing, advertising and promoting the factors (i.e. knowledge, trust in government, and speed of transaction) that drive intent to invest in cryptocurrencies.
Abstract A recent wave of scholarship attests that the liberal world order is under threat. Although there is disagreement about the underlying reasons for this diagnosis, there are few attempts to further our understanding of how the liberal order can be reinvigorated. This paper probes the potential of blockchain technology to promote international cooperation. Blockchain technology is a data structure that enables global governance stakeholders to establish decentralized governance systems which provide high-powered incentives for enhanced cooperation. By outlining the contours of a blockchain-based global governance system for climate policy, the paper illustrates that blockchain technology holds theoretical promise to foster cooperation in three ways: leveraging new sources of information through blockchain-based prediction markets; allaying coordinating problems through reducing the cost of transactions for side payments; and allowing states and other global governance actors to make more credible commitments given guaranteed execution of blockchain-enabled smart contracts. By empowering local knowledge holders and non-state actors that traditionally lacked the means to coordinate efforts to influence global politics, blockchain technology also promises to advance an international order based on liberal values. In actuality, however, emerging blockchain-based global governance systems will fall short of the libertarian ideal of ‘fully-automated liberalism’ as their design and operation will remain under the shadow of power.
In the last few years, the world has witnessed a fast expansion of bitcoin and other cryptocurrencies. From being mostly associated with criminal activity in their earliest years, cryptocurrencies have now taken a step into the legal business markets. The increased use of cryptocurrencies in business and commercial transactions entails that their appearance in the insolvency proceedings can be expected in a foreseeable future. However, the fast development of cryptocurrencies means that the current regulatory frameworks around the world have not kept up with the changes, which is especially noticeable in international situations. The continuous growth of cryptocurrencies and their value indicate that they will become very interesting for insolvency practitioners in the future, but the lack of regulation and case law within this field raises the question of how they will and should be treated. \n \nWhile cryptocurrencies continue to find their place in modern society, whether and to what extent they should be regulated in the international insolvency law is a vastly approaching issue. This thesis discusses the possibility of regulating cryptocurrencies on the international level of the insolvency law by examining firstly, the different risks and issues that the cryptocurrencies will give rise to in the insolvency law and insolvency proceedings with a special focus on jurisdiction, secondly, the current regulatory frameworks and principles on international and European Union level and lastly, the possibilities of regulation through both soft law and hard law in order to create a way to approach these problems. The possibility of regulation will be discussed in a multidisciplinary light, with the principles of international financial law as well as the nature of blockchain-based technology taken into consideration. \n \nThe aim of the thesis is not to come up with a specific course of action, but rather to enlighten the most prominent pros and cons of different possibilities. The potential ways of regulation brought up in the thesis are the use of blockchain technology itself, amendment of existing legal frameworks, the use of regulatory sandboxes and a new legal framework.
Philipp Schuster, Erik Theissen, Marliese Uhrig‐Homburg
The blockchain technology was first implemented in 2009 as the basis of the cryptocurrency Bitcoin. The technology is said to be a disruptive technology that has the potential to significantly affect many areas of the economy. In this paper we provide a survey of the blockchain technology and its applications in finance. We focus on cryptocurrencies, smart contracts, initial coin offerings, the clearing and settlement of transactions in financial markets, and implications for the governance of exchange-listed firms.
Blockchain is drawing attention as rising technology with the advantages of security, transparency, and immutability by a decentralized network structure. However, blockchain technology is still an immature technology and lacks common standards. The researches on blockchain technology have been mainly focused on the financial sector but rarely applied to the supply chain in industry sectors. Especially, the blockchain technologies developed by technology entrepreneurs are still challenging to apply to an actual business due to a lack of understanding of the possibility of creating value. Therefore, it is necessary to provide technological entrepreneurs with an understanding of the business model and the feasibility of creating value with the new technology like blockchain. To address the issue, this study investigates how blockchain technology is effectively applicable and what value can be achieved from it. The purpose of this study is to analyze a livestock traceability system using blockchain technology and investigate its business model in terms of the value proposition, value delivery, and value creation. This study would provide insights into the business value creation of blockchain technology.
Abstract What is the impact of blockchain technology on electronic markets in the energy sector? In this interview with Electronic Markets, Dr. Tobias Paulun, chief strategy officer of the European Energy Exchange (EEX), explains where the leading European energy exchange recognizes potentials of blockchain technology compared to existing electronic platforms and which blockchain projects EEX is working on. In his view, the impact of blockchain technology depends on the respective market segment and on the availability of solutions for safeguarding guarantees of origin. He expects that established exchange systems and blockchain-based systems will coexist in this strongly regulated and specialized industry.
Electricity generation is decentralising quickly. Simultaneously, final energy use for residential customers electrifies in order to reduce carbon dioxide emissions. Together with ubiquitous digitalisation, this decentralisation and flexibility at the demand side paves the way towards local energy communities and – in its most distributed version – to peer-to-peer energy trading, where customers buy and sell electricity among each other. Although peer-to-peer energy trading is not yet legal everywhere, ‘citizen energy communities’ have been introduced as cornerstones of the energy transition by the European Commission in their ‘Clean Energy for All Europeans’ programme. This paper firstly discusses this digitalisation and decentralisation of the power infrastructure. These trends are supported by distributed information technologies, including peer-to-peer control paradigms. Distributed ledger technologies, such as blockchains, might be one such piece of the puzzle. The second part of the paper investigates whether blockchain technologies, and their associated smart contracts, offer advantages for larger-scale peer-to-peer energy-trading applications over a classic, centralised approach. Different blockchain implementations are investigated and qualitatively evaluated from a scalability, efficiency and trust perspective. The conclusion indicates that in the current state of the art, a trade-off between decentralised and more classical (hierarchically centralised) solutions suits larger-scale peer-to-peer energy-trading applications best.
A companion paper defined the notion of digital social contracts, presented a design for a social-contracts programming language, and demonstrated its potential utility via example social contracts. The envisioned setup consists of people with genuine identifiers, which are unique and singular cryptographic key pairs, that operate software agents thus identified on their mobile device. The abstract model of digital social contracts consists of a transition system specifying concurrent, non-deterministic asynchronous agents that operate on a shared ledger by performing digital speech acts, which are cryptographically-signed sequentially-indexed digital actions. Here, we address the distributed-ledger implementation of digital social contracts in the presence of faulty agents: we present a design of a fault-tolerant distributed-ledger transition system and show that it implements the abstract shared-ledger model of digital social contracts, and discuss its resilience to faulty agents. The result is a novel ledger architecture that is distributed with a blockchain-per-person (as opposed to centralized with one blockchain for all), partially-ordered (as opposed to totally-ordered), locally-replicated (as opposed to globally-replicated), asynchronous (as opposed to globally-synchronized), peer-to-peer with each agent being both an actor and a validator (as opposed to having dedicated miners, validators, and clients), environmentally-friendly (as opposed to the environmentally-harmful Proof-of-Work), self-sufficient (as opposed to the energy-hogging Proof-of-Work or capital-hogging Proof-of-Stake) and egalitarian (as opposed to the plutocratic Proof-of-Work and Proof-of-Stake).
A companion paper defined the notion of digital social contracts, presented a design for a social-contracts programming language, and demonstrated its potential utility via example social contracts. The envisioned setup consists of people with genuine identifiers, which are unique and singular cryptographic key pairs, that operate software agents thus identified on their mobile device. The abstract model of digital social contracts consists of a transition system specifying concurrent, non-deterministic asynchronous agents that operate on a shared ledger by performing digital speech acts, which are cryptographically-signed sequentially-indexed digital actions. Here, we address the distributed-ledger implementation of digital social contracts in the presence of faulty agents: we present a design of a fault-tolerant distributed-ledger transition system and show that it implements the abstract shared-ledger model of digital social contracts, and discuss its resilience to faulty agents. The result is a novel ledger architecture that is distributed with a blockchain-per-person (as opposed to centralized with one blockchain for all), partially-ordered (as opposed to totally-ordered), locally-replicated (as opposed to globally-replicated), asynchronous (as opposed to globally-synchronized), peer-to-peer with each agent being both an actor and a validator (as opposed to having dedicated miners, validators, and clients), environmentally-friendly (as opposed to the environmentally-harmful Proof-of-Work), self-sufficient (as opposed to the energy-hogging Proof-of-Work or capital-hogging Proof-of-Stake) and egalitarian (as opposed to the plutocratic Proof-of-Work and Proof-of-Stake).
Islamic finance ecosystem could leverage from blockchain technology in order to improve business processes and streamline operations. The characteristics and conditions of blockchain are in alignment with the principles of Islamic Law as it creates the possibility of coordinating institutions' transactional activities within a strong mechanism of trust and transparency. Blockchain technology allows businesses to build decentralized models and opens new horizons for them to conduct transactions and make agreements. And one of the technologies that is proposing an alternative to the traditional model is smart contract. Smart contracts are closer to Islamic contracts with an undiluted focus on avoidance of any kind of uncertainty regarding settlement of the contracts. One would witness a sharp reduction in the element of gharar with contracting between unknown parties that meet on the internet, when Islamic contracts take the form of self-executing digital or smart contracts, with "electronically coded" terms of executions. The contractual terms will execute only if the pre-configured conditions are met. This will automate the entire contractual process for Islamic institutions. The Islamic contracts will now be easy to verify, immutable and secure, mitigating gharar in the form of operational risks arising from settlement, as well counterparty risks. The adoption of Smart contracts by the Islamic finance industry is the most natural thing to do, not just to gain a strong foothold in this technological revolution, but also to be able to fully comply with the Shari'ah in a transparent way. The Shari'ah laws can form the conditions of a smart contract. Honesty, transparency and trustworthiness are qualities that should make a financial transaction in the Islamic finance industry, and smart contracts are inherently all of these. In the era of faster globalization, risk management is of essential importance for banks. As credit risk being the most significant risk in Islamic Finance Institutions' (IFIs), we stressed our attention in this paper on it and as per our opinion we believe that the new ledger technology will add value for IFIs in terms of reducing it. Blockchain and particular Smart contracts would help reducing credit losses; provide more transparent and accurate credit ratings for capital allocation, which could lead to minimization of the required capital allocation for credit loss, as well better and cheaper administration and facilitation of collaterals. All the above will improve IFI's profitability and shareholders value. Not only the Islamic banks will abide fully with Shari'ah rules, but they could gain more international customers seen as the more reliable choice. The purpose of the study consists of analyzing the role of blockchain and smart contracts as a tool for risk management. We used AlInma bank as a case study to show the impact of using new FINTECH in Islamic finance. The main findings of the paper show that using blockchain and smart contracts as a tool of risk management reduces costs for IFIs considerably. The paper is organized as follows: section one will present the introduction and literature review. Section two describes Blockchain technology and Smart contracts and finally we focus on how risk management could benefit from these technologies in Islamic financing. The rest of the sections will present and discuss the use of blockchain in risk management.
The intersection of finance and technology, known as fintech, has resulted in the dramatic growth of innovations and has changed the entire financial landscape. While fintech has a critical role to play in democratizing credit access to the unbanked and thin-file consumers around the globe, those consumers who are currently well served also turn to fintech for faster services and greater transparency. Fintech, particularly the blockchain, has the potential to be disruptive to financial systems and intermediation. Our aim in this paper is to provide a comprehensive fintech literature survey with relevant research studies and policy discussion around the various aspects of fintech. The topics include marketplace and peer-to-peer lending; credit scoring; alternative data; distributed ledger technologies; blockchain; smart contracts; cryptocurrencies and initial coin offerings; central bank digital currency; robo-advising; quantitative investment and trading strategies; cybersecurity; identity theft; cloud computing; use of big data, artificial intelligence. and machine learning; identity and fraud detection; anti-money laundering; Know Your Customers; natural language processing; regtech; insuretech; sandboxes; and fintech regulations.
The formation of IT companies and even of entire new technological ecosystems depends heavily on external financing. Consequently, the IS community has intensely studied various financing sources such as venture capital, initial public offerings or debt. Blockchain technology has led to the emergence of a system of decentralized finance (DeFi) which includes decentralized versions of equity and debt financing. In particular, equity-like fundraisings referred to as initial coin offerings (ICO) have received serious traction. In this paper, we investigate the role of user-generated content (UGC) for ICO success. Specifically, we leverage signaling theory to analyze how the activity on blogs and discussion forums is related to the amount of capital raised and the valuation in ICOs. We analyze data of 216 ICOs and provide first results indicating the importance of discussion forum activity for ICO success. Furthermore, we find that blogs seem less relevant than in traditional finance.