Abstract A blockchain replaces central counterparties with time-consuming consensus protocols to record the transfer of ownership. This settlement latency slows cross-exchange trading, exposing arbitrageurs to price risk. Off-chain settlement, instead, exposes arbitrageurs to costly default risk. We show with Bitcoin network and order book data that cross-exchange price differences coincide with periods of high settlement latency, asset flows chase arbitrage opportunities, and price differences across exchanges with low default risk are smaller. Blockchain-based trading thus faces a dilemma: Reliable consensus protocols require time-consuming settlement latency, leading to arbitrage limits. Circumventing such arbitrage costs is possible only by reinstalling trusted intermediation, which mitigates default risk.
André Greubel, Alexandra Dmitrienko, Samuel Kounev
In the Tor anonymity network, the distribution of topology information relies on the correct behavior of five out of the nine trusted directory authority servers. This centralization is concerning since a powerful adversary might compromise these servers and conceal information about honest nodes, leading to the full de-anonymization of all Tor users. Our work aims at distributing the work of these trusted authorities, such increasing resilience against attacks on core infrastructure components of the Tor network. In particular, we leverage several emerging technologies, such as blockchains, smart contracts, and trusted execution environments to design and prototype a system called SmarTor. This system replaces the directory authorities with a smart contract and a distributed network of untrusted entities responsible for bandwidth measurements. We prototyped SmarTor using Ethereum smart contracts and Intel SGX secure hardware. In our evaluation, we show that SmarTor produces significantly more reliable and precise measurements compared to the current measurement system. Overall, our solution improves the decentralization of the Tor network, reduces trust assumptions and increases resilience against powerful adversaries like law enforcement and intelligence services.
Rômulo Rhemo Palitot Braga, Arthur Augusto Barbosa Luna
This article analyzes some of the existing digital anonymity technologies, as well as their impact on the process and facilitation of the money laundering process. It presents the concept of superficial Internet and clarifies the difference between the Deep Web and the Dark Web, exposing how it works one of its most important operating structures, the TOR protocol. It also details the operation of BitCoin, one of the most important crypto-coins today, and draws a parallel on how these technologies can impact the practice of money laundering, as well as discusses the capacity of the mechanisms currently in place to curb and punish it. The anonymity guaranteed by the use of BitCoin is so much that in the first half of May 2017, hackers infected thousands of computers in dozens of countries, including Brazil, the United Kingdom, the United States, China, Russia, Spain and Italy, encrypting computer files and requiring redemption payment for the coded data.
Smart contracts são criados por meio de códigos computacionais para execução automática de seus termos após a implementação da condição avençada pelas partes. Apresentam-se como fruto da Revolução Tecnológica, especialmente com o advento da internet e ganham relevância no mundo negocial após o surgimento da tecnologia blockchain, a qual permite o armazenamento dos códigos em cadeia de blocos, reduzindo os custos de execução contratual. Assim, os códigos que dão origem aos contratos inteligentes serão autoexecutáveis, autoaplicáveis e obrigatórios, e nada poderá interferir na produção dos efeitos jurídicos avençados pelas partes. São inúmeros desafios jurídicos impostos à realização dos smart contracts no Brasil, principalmente, porque inexistem leis específicas para tutela desta inovação contratual. A pesquisa buscou verificar a existência de obstáculos a execução destes contratos, à luz do princípio da função social dos contratos, por tratar-se norma principiológica cuja aplicação é indispensável a garantia do equilíbrio entre as partes durante todas as fases contratuais. Constatou-se, por meio do método dedutivo e procedimento monográfico, que as próprias características dos smart contracts executados em blockhain, obstam a efetividade das garantias inerentes ao princípio da função social, ante a irreversibilidade dos efeitos jurídicos produzidos, evidenciando, pois, a relevância do tema para a ciência jurídica.
Tsung-Ting Kuo, Rodney A. Gabriel, Lucila Ohno‐Machado
OBJECTIVE: Decentralized privacy-preserving predictive modeling enables multiple institutions to learn a more generalizable model on healthcare or genomic data by sharing the partially trained models instead of patient-level data, while avoiding risks such as single point of control. State-of-the-art blockchain-based methods remove the "server" role but can be less accurate than models that rely on a server. Therefore, we aim at developing a general model sharing framework to preserve predictive correctness, mitigate the risks of a centralized architecture, and compute the models in a fair way. MATERIALS AND METHODS: We propose a framework that includes both server and "client" roles to preserve correctness. We adopt a blockchain network to obtain the benefits of decentralization, by alternating the roles for each site to ensure computational fairness. Also, we developed GloreChain (Grid Binary LOgistic REgression on Permissioned BlockChain) as a concrete example, and compared it to a centralized algorithm on 3 healthcare or genomic datasets to evaluate predictive correctness, number of learning iterations and execution time. RESULTS: GloreChain performs exactly the same as the centralized method in terms of correctness and number of iterations. It inherits the advantages of blockchain, at the cost of increased time to reach a consensus model. DISCUSSION: Our framework is general or flexible and can also address intrinsic challenges of blockchain networks. Further investigations will focus on higher-dimensional datasets, additional use cases, privacy-preserving quality concerns, and ethical, legal, and social implications. CONCLUSIONS: Our framework provides a promising potential for institutions to learn a predictive model based on healthcare or genomic data in a privacy-preserving and decentralized way.
Open access
Privacy-Preserving Technologies in Data
Artificial Intelligence in Healthcare and Education
Azim Muhammad Fahmi, Noor Azah Samsudin, Aida Mustapha, Nazim Razali · 5 authors
In 2017, a significant number of individuals profited from the staggering growth of the price of Bitcoin from $800 USD in January to almost $20,000 USD in December. Because the cryptocurrency market being relatively new when compared to traditional markets such as stocks, foreign exchange, and gold, there is a significant lack of studies in regard to predicting its price behavior. This research is interested in evaluating a number of regression-based algorithms in predicting the price of the Bitcoin (BTC) against United States Dollar (USD). Among the algorithms that will be investigated include the Linear Regression (LR), Neural Network Regression (NNR), Bayesian Linear Regression (BLR), and Boosted Decision Tree Regression (BDTR). By applying such regression-based analysis algorithms, the findings f should further help document the behavior of such a brand new, challenging yet extremely lucrative market. Â
Christof Ferreira Torres, Julian Schütte, Radu State
The capability of executing so-called smart contracts in a decentralised manner is one of the compelling features of modern blockchains. Smart contracts are fully fledged programs which cannot be changed once deployed to the blockchain. They typically implement the business logic of distributed apps and carry billions of dollars worth of coins. In that respect, it is imperative that smart contracts are correct and have no vulnerabilities or bugs. However, research has identified different classes of vulnerabilities in smart contracts, some of which led to prominent multi-million dollar fraud cases. In this paper we focus on vulnerabilities related to integer bugs, a class of bugs that is particularly difficult to avoid due to some characteristics of the Ethereum Virtual Machine and the Solidity programming language.
Abstract Electronic government (e-government) uses information and communication technologies to deliver public services to individuals and organisations effectively, efficiently and transparently. E-government is one of the most complex systems which needs to be distributed, secured and privacy-preserved, and the failure of these can be very costly both economically and socially. Most of the existing e-government systems such as websites and electronic identity management systems (eIDs) are centralized at duplicated servers and databases. A centralized management and validation system may suffer from a single point of failure and make the system a target to cyber attacks such as malware, denial of service attacks (DoS), and distributed denial of service attacks (DDoS). The blockchain technology enables the implementation of highly secure and privacy-preserving decentralized systems where transactions are not under the control of any third party organizations. Using the blockchain technology, exiting data and new data are stored in a sealed compartment of blocks (i.e., ledger) distributed across the network in a verifiable and immutable way. Information security and privacy are enhanced by the blockchain technology in which data are encrypted and distributed across the entire network. This paper proposes a framework of a decentralized e-government peer-to-peer (p2p) system using the blockchain technology, which can ensure both information security and privacy while simultaneously increasing the trust of the public sectors. In addition, a prototype of the proposed system is presented, with the support of a theoretical and qualitative analysis of the security and privacy implications of such system.
This The virtual currency is a paramount in a strong economical situation of any country in the future, especially the countries that try to lead the world with its economy, this currency has been created to replace the traditional currency of the countries that can be issued by any central bank and put a value for it, but the virtual currency is a currency that no one can control and manipulate its value and no one can use it to control any country economical situation (c.f. Selgin, 1988).The virtual currency helps poor countries to develop its economy because it will have the same currency that any developed country has with the same value. But the virtual currency will face a lot of problems before entering to market(Gandal, N., &Halaburda, H. (2014) and will face a lot of barriers that will stop the development of the state economy, some of those problems are: the culture of the country and the government laws and policies, plus there is an important problem that it will face and it represent by the economic agreements and the Unified Banks Network (e.g. Jerin, 2014).To solve those problems the research will use the qualitative method with an interpretive research philosophy, that helps the research to use specific case study that have similar situation to collect the second data and use the interview to collect the primary data.The interview that is made with experts will show some solution that answer the research question and it can be applied and the step to apply it to receive to needed solution to let the virtual currency be accepted in the market (Gandal, N., &Halaburda, H. (2014). Therefore, the government started to encourage the citizen and the companies to use this new currency, and they created an environment that helps those users to trust and accept it.This currency will face a lot of obstacles and problems at the beginning, the government will try to put plans and long term strategies to solve these problems before they occur, starting from creating and issuing new laws and policies arriving to create a large and strong educational advertising to let the citizen know this new currency and its benefits.Also, the private sectorsare responsible too, especially the bank sectors because they have the principle relation with this field and they have to motivate their customers to use it (Gans, J., &Halaburda, 2013).From this research, we will try to find some solutions that the concerned sector need to apply to let the virtual currency enter the market and let the citizen trust it and start trading with it (Gandal, N., &Halaburda, H. (2014).
In this era of increasing cyber dependency in business dealings there is huge potential in the adoption of Distributed Ledger Technologies (DLT) particularly in the context of smart contract in the commercial world. The phenomenon of smart contract operates independently without the cumbersome need to engage any intermediary and is capable of executing specific task.(Thake, 2018) People relates it more to a piece of code (known as a software agent) that is designed to execute certain tasks if pre-defined conditions are met. Such tasks are often embedded within, and performed on a distributed ledger.â€(Stark, 2016) However, if one accepts the contention that smart contract is not merely as a set of computer code but a smart legal contract which contains obligations and legal terms that are enforceable, hence, in programming or writing smart contract, one must ensure that the software developers who design smart contract take note of the legal rules and principles behind the specific type of contract in question. It has been argued that there is too much dependency on the programming aspect in the creation of smart contracts by programmers and computer scientists. (Khalil et al., 2017)
CPS (Cyber Physical Systems) have got wide application and research, and information security risk evaluation became the key for CPS greatly developing. In view of the physical structure and business characteristics of CPS, this paper constructs an information security risk evaluation system for CPS. In the process of risk evaluation, colligating the analysis results from experts and the analysis results of external data sources' related big data for information security risk evaluation of CPS, by experts confirming the index system and indexes' weight values for CPS information security risk evaluation, further through using evaluation model to realize the quantitative calculation to CPS information security risks. This paper proposes using blockchain technology to construct the data's authenticity and reliability guarantee system for CPS and CPS related external systems, and constructing blockchain's layered model structure based on CPS. In the part of case analysis, comparing and analysing the evaluation system based on blockchain and big data and the evaluation system based on traditional mode, to confirm the research value of this paper.
Mei Yu, Jie Zhang, Jianrong Wang, Jie Gao · 8 authors
Now, the security and privacy-preserving of Internet of Things are receiving more attention. This article proposes a new method of Internet of Things security and privacy preserving by combining differentiated nodes, precision clustering, RSA, multi-signature, and blockchain. To calculate the node rank value in Internet of Things, the number of nodes’ links is taken as the weight of nodes based on PageRank. This method increases the node rank values’ difference between nodes. Accurate clustering determines the initial central nodes of k-means based on the differentiated node rank values, which effectively differentiates the active and inactive nodes in Internet of Things and achieve different levels of protection. To ensure data’s reusability, we adopt the multi-signature. And considering node’s incoming nodes have certain decision on whether data can be transmitted, we filter out two nodes with the highest node rank value from active node’s incoming nodes to do 2/3 multi-signature which saves resources. We encrypt and sign the transmitted data with RSA, helping receivers to verify data. Data are transmitted safely through the blockchain. Successful validation indicates successful transmission. Experiments show that the proposed method can effectively distinguish between active and inactive nodes, which increases the difficulty of attackers’ attack and effectively protects the security and privacy of Internet of Things nodes and data.
The local government administrations in Romania have become more visible for taxpayers lately, once the decentralization process has developed. The interest in knowing how local government resources are used has increased, especially after diversifying and increasing funding sources. The present paper presents a detailed analysis of the public revenues and expenditures for the territorial administrative units in Romania. A number of local public finance problems are highlighted: the decrease of public investment, the budget imbalances, the increase of transfers from the state budget, etc., which have been worsened by some legislative changes in recent years.
Beverley A. MacKenzie, Robert Ian Ferguson, Xavier Bellekens
In a few short years the Internet of Things has become an intrinsic part of everyday life, with connected devices included in products created for homes, cars and even medical equipment. But its rapid growth has created several security problems, with respect to the transmission and storage of vast amounts of customers data, across an insecure heterogeneous collection of networks. The Internet of Things is therefore creating a unique set of risk and problems that will affect most households. From breaches in confidentiality, which could allow users to be snooped on, through to failures in integrity, which could lead to consumer data being compromised; devices are presenting many security challenges to which consumers are ill equipped to protect themselves from. Moreover, when this is coupled with the heterogeneous nature of the industry, and the interoperable and scalability problems it becomes apparent that the Internet of Things has created an increased attack surface from which security vulnerabilities may be easily exploited. However, it has been conjectured that blockchain may provide a solution to the Internet of Things security and scalability problems. Because of blockchain's immutability, integrity and scalability, it is possible that its architecture could be used for the storage and transfer of Internet of Things data. Within this paper a cross section of blockchain consensus protocols have been assessed against a requirement framework, to establish each consensus protocols strengths and weaknesses with respect to their potential implementation in an Internet of Things blockchain environment.
Internet of Things is widely used in many fields such as industry, medical care, education, and supply chain. With the participation of multi-authorized entities, a large number of dynamic data will be generated in the basic dimension of time. The operations on these data have to be safe and traceable for use in various forensics and decisions. Therefore, the key point of dynamic data security protection is to reject tampering of unauthorized users and to realize the process in evidence and tracing of the dynamic data operation. In order to find a solution to the problem above, an optimization of dynamic data traceability mechanism based on consortium blockchain is proposed in this article. First, a mathematical model for the security of dynamic data storage has been established, followed by analysis on honest behavior motive of individual node decision-making in group game and distributed node cooperation essence in specific industry background. After that, ownership transition function and the architecture of the dynamic data storage system are optimized; quality and growth characteristics of the system under stochastic state model are analyzed. Result shows that the solution can effectively avoid potential attacks such as tampering and faking under approved accession mode. The mechanism has good application value while ensuring the dynamic data storage security.
Fostering Worker Cooperatives with Blockchain Technology: Lessons from the Colony Project In recent years, there has been growing policy support for expanding worker ownership of businesses in the European Union. Debates on stimulating worker ownership are a regular feature of discussions on the collaborative economy and the future of work, given anxieties regarding the reconfiguration of the nature of work and the decline of standardised employment contracts. Yet, worker ownership, in the form of labour-managed firms such as worker cooperatives, remains marginal. This article explains the appeal of worker cooperatives and examines the reasons why they continue to be relatively scarce. Taking its cue from Henry Hansmann’s hypothesis that organisational innovations can make worker ownership of firms viable in previously untenable circumstances, this article explores how organisational innovations, such as those embodied in the capital and governance structure of Decentralised (Autonomous) Organisations (D(A)Os), can potentially facilitate the growth of LMFs. It does so by undertaking a case study of a blockchain project, Colony, which seeks to create decentralised, self-organising companies where decision-making power derives from high-quality work. For worker cooperatives, seeking to connect globally dispersed workers through an online workplace, Colony’s proposed capital and governance structure, based on technological and game theoretic insight may offer useful lessons. Drawing from this pre-figurative structure, self-imposed institutional rules may be deployed by worker cooperatives in their by-laws to avoid some of the main pitfalls associated with labour management and thereby, potentially, vitalise the formation of the cooperative form.
Bitcoin is a cryptocurrency that is gaining popularity over the years. It can generate a significant amount of return while having a high volatility. Given the high risk, high return nature of Bitcoin, the study aimed at determining whether Bitcoin offers diversification benefit in a portfolio. Two characteristics of Bitcoin (correlation and volatility) were examined, and optimal portfolio analysis was conducted using different weights of Bitcoin. The study showed that Bitcoin's low correlations with most securities and assets in the market help diversify portfolios, but the currency's high volatility indicates that only a small amount of Bitcoin should be included in portfolio diversification.
Blockchain technologies (BC) are immutable distributed systems of digital ledgers (i.e., without central repository) and, as rule, without central authority. Currently, there is a lot of excitement around the use of BC technology, although the technology itself, on the one hand, is still not quite clear to many ones, and on the other (and this is the main thing) is not new. Superficial understanding of the BC as a phenomenon with «magical properties» leads to numerous predictions about the possibility of revolutionary transformations based on its application to entire sectors of the economy and, above all, in the credit and financial sphere. In this regard, this article presents a systematized analysis, the history of the BC emergence, leading from the international standards ISO 7498-2 of 1989 and ITU-T X.800 of 1991, as well as a brief informal definition of BC and considered are the basic principles and components of this technology, including cryptographic one-way functions (hashes), transactions, addresses and their retrieval, «digital wallets», ledgers, blocks, blockchain in operations. Representation of the BC as a sequence of blocks bounded base on known mechanisms of the data integrity with using asymmetric cryptography allows us to conclude that only its evolutionary development is possible, although at a rapid pace in real time. This is a characteristic feature of establishing modern stage of and all other IT types. In conclusion, attention is drawn to the need for additional research to assess the security and reliability of the BC in terms of assessing the prospects for its use in specific business applications and critical information infrastructure systems.
The article identifies gaps in the legal regulation of Kiptocurrency status. The state of legislative regulation of cryptocurrency turnover in Ukraine is considered. The possibility of using cryptocurrency is considered in the economic activities of business entities, namely, making it into the authorized capital. The analysis of modern and foreign experience is given for example. On its basis, the solution of this problem is proposed.
There has recently been a wave of enthusiasm for applying Blockchain technology in the food sector. This article aims to clarify many of the questions surrounding Blockchain technologies, in particular: is Blockchain the future for the food industry and therefore does my company need a Blockchain? Traceability has been achieved for many years using systems that connect core business processes with strategic management of product and supply chain data, namely Enterprise Resource Planning (ERP) platforms. Companies must determine what Blockchains can offer that is different from existing ERP systems and what is the value of using them. Working within a secure cloud platform is mainstream today but this was not the case five years ago.
While ERP systems have significant benefits that can be realised, they are often very expensive to implement, with the cost of implementation linked to the operational complexity. The full costs can range broadly from £150,000 to £1,000,000+ and therefore are prohibitive for many SMEs, which make up 96% of the UK Food industry.
Mathematics is not universal.Traditional (normal) mathematics accepts both deductive and empirical proofs like science.Colonial education replaced it with formal mathematics, the unique feature of which is not the use of reasoning but exclusion of the empirical.The coloniser never critically compared normal and formal mathematics, and tries to block such a comparison today.In Western dogma (of the church theology of reason) deduction is infallible.In fact, deduction is fallible.(1) An invalid deductive proof may be mistaken as valid.Doubts about validity can only be settled inductively.In practice, doubts are settled by invoking authority.Hence, deductive proofs are always more fallible than empirical proofs.(2) The postulates of formal math cannot be empirically checked; they are metaphysics (a metaphysics of infinity is needed even for the formal math of 1+1=2).Thus, far from being eternal truths, formal mathematical theorems may not even be approximately valid knowledge.(3) Formal math dogmatically assumes two-valued logic (on the superstition that logic binds God).But logic is neither culturally universal (e.g.Buddhist logic) nor empirically certain (quantum logic).Therefore, the theorems of formal math (even if valid) are not even truths relative to postulates.Hence, colonial/formal math is inferior and should be rejected.This does not affect the practical value of math -what 'works'which all comes from normal math which we should, accordingly, teach.I describe two actual decolonised math courses being taught: decolonised geometry in school, and decolonised calculus in the university.Decolonised (string) geometry that is indigenous to Africa and India, is superior to the geometry currently taught in terms of conceptual clarity (points, angle, distance), ease of learning, and practical applications.Decolonised calculus teaches calculus as normal math, the way it originated in India as a numerical technique to solve differential equations, together with non-Archimedean arithmetic (instead of formal 'real' numbers) and zeroism (instead of limits) used to sum infinite series.Europeans stole calculus from India, and falsely attributed it to Newton and Leibniz, who failed to understand how to sum infinite series due to the Western superstition (since Plato) that mathematics is eternal truth, and hence exact.Eventually, they introduced a metaphysics of infinity allied to church dogmas of eternityset theory, formal real numbers, and limitsas taught in university today.This metaphysics is irrelevant for any practical application of calculus, such as sending a rocket to the moon, but makes calculus very difficult.Decolonised calculus is easy, requires almost no background, and results in better science.It enables students to solve harder problems not covered in usual calculus courses.However, it excludes the ability to slip politically convenient dogmas into science through the metaphysics of formal math, and is, hence, resisted by the coloniser today.