The aim of the article is to research the prospects and opportunities for using blockchain technology in entrepreneurship, as well as international payments and banking operations. On the basis of current and up-to-date data and opinions of authoritative English-language publications on business, the problems concerning the relevance of technology of a distributed ledger have been comprehensively examined, and the results of many startups – young companies working on blockchain-solutions in various spheres, have been evaluated. As a result of the research, the main directions of work of startups in the field of application of blockchain technology were identified: smart contracts; cloud data storage; production processes; sphere of remuneration of employees; electronic voting with protection against breaking; "sharing economy". Prospects for further research in this direction are specific justification of the applicability of distributed ledger technology and the concept of decentralization in developing sectors (the "sharing economy", "Internet of Things"), as well as a deeper analysis of the impact of new solutions in relation to the traditional sectors of the economy, including Ukraine.
Blockchain technology has the potential to decentralise many traditionally centralised systems. However, scalability remains a key challenge. A horizontally scalable solution, where performance increases by adding more nodes, would move blockchain systems one step closer to ubiquitous use. We design a novel blockchain system called CHECO. Each node in our system maintains a personal hash chain, which only stores transactions that the node is involved in. A consensus is reached on special blocks called checkpoint blocks rather than on all transactions. Checkpoint blocks are effectively a hash pointer to the personal hash chains; thus a single checkpoint block may represent an arbitrarily large set of transactions. We introduce a validation protocol so that any node can check the validity of any transaction. Since transaction and validation protocols are point-to-point, we achieve horizontal scalability. We analytically evaluate our system and show a number of highly desirable correctness properties such as consensus on the validity of transactions. Further, we give a free and open-source implementation of CHECO and evaluate it experimentally. Our results show a strong indication of horizontal scalability.
The attempts to create an adequate model of socio-economic critical events, which, as it has been historically proven, are almost permanent, were, are and will always be made. Actually, it is a supertask, impossible to solve. However, the potentially useful solutions, local in time or other socio-economic logistic coordinates, are possible. In fact, they have to be the object of interest for a real and effective economic science. Econophysics is a young interdisciplinary scientific field, which developed and acquired its name at the end of the last century. Quantum econophysics, a direction distinguished by the use of mathematical apparatus of quantum mechanics as well as its fundamental conceptual ideas and relativistic aspects, developed within its boundaries just a couple of years later, in the first decade of the 21-st century.
The technology of blockchain (‘Blockchain’) realises a more efficient, equitable, and transparent distributed ledger system. An important characteristic of Blockchain is its automated, de-centralized, and neutral ledger system which could be useful to carry out Corporate Social Responsibility (‘CSR’) initiatives. Part I of this paper suggests that the Blockchain will evolve to become a permanent ‘disruptor’ with the potential to transform corporations’ CSR practices. Part II introduces the Blockchain and identifies its significance to CSR, both in the United States (‘U.S.’) and internationally. Part III explains how the Blockchain can help demonstrate that a corporation is a ‘responsible business’ through good corporate governance, effective supply chain management, and exercise of the triple bottom line – people, profit, and planet. Part IV examines how the Blockchain’s disruptive role influences corporate decision-making, especially its implications for corporate investors, financial institutions, and the practice of law as well as its impact on intellectual property and data privacy functions. Part V discusses the U.S. current regulatory landscape and growing trends relating to the Blockchain. Finally, Part VI recommends lawmakers and corporations consider adopting a legislative framework that aligns with the United Nations Sustainable Development Goals (‘UN SDGs’) to demonstrate responsible investment and good corporate governance. Accordingly, the Blockchain can help corporations transform CSR practices and assist lawmakers to regain public trust through effective rulemaking that demands corporate accountability on domestic and international issues.
This paper explores the interactions between distributed ledgers, smart contracts and geographic location.Location is a fundamental part of human existence, as well as being crucial personally identifying information.We are interested in techniques for using location in smart contracts, to enable new kinds of services and systems, that link real world events to the abstract logics of blockchain systems.There are many challenges here, from the technical issues of sensing and securely storing location data, through to how to make use of the information in a privacy preserving manner, to developing a system of location appropriate for use in smart contracts.We discuss an experiment in progress to elicit a taxonomy of locations, and the important features of each.We then look at the techniques for capturing and storing this securely, and imagine how this feeds into the design of future active travel systems.
Objectives: Incorporating new technologies into the development of smart cities means rethinking the way different services are provided. From this perspective, Blockchain might represent the future of both smart cities and smart communities as it offers new alteratives for individuals and institutions.
The East Asian cryptocurrency market has burgeoned in the past few years, especially in Japan, China, and South Korea. This means that more and more people are involved in dealings over this novel form of ‘economic value’. But, what exactly are people selling and buying? Traditionally, things can be divided into moveables (i.e., tangible things such as books, physical money such as coins or notes, or intangible things such as debts etc.) and immoveables (i.e., land). While the rules pertaining to transactions in such traditional things are well recognised, the same cannot be said of cryptocurrencies. The uncertainty of their characterisation renders it difficult to be confident in transaction finality as a matter of law and also potentially exacerbates dispute resolution. Two issues merit exploration: Is a cryptocurrency a thing as such? If so, can it be the object of a property right? Many other relevant legal issues concerning cryptocurrencies (i.e., how they are protected by law, the legal rules relating to their transfer, or systematic deployment etc.) would hinge upon the above two fundamental issues. Their characterisation may also be significant for conflict of laws characterisation purposes as many of the essential infrastructure for the trading of cryptocurrencies (e.g., mining and exchanges) are located in East Asia. This Chapter aims to survey the major East Asian civil law jurisdictions (i.e. Japan, China, and South Korea) to ascertain how they may address these questions in the light of their respective laws.
Ransomware is a type of malware that encrypts the files of infected hosts and demands payment, often in a crypto-currency like Bitcoin. In this paper, we create a measurement framework that we use to perform a large-scale, two-year, end-to-end measurement of ransomware payments, victims, and operators. By combining an array of data sources, including ransomware binaries, seed ransom payments, victim telemetry from infections, and a large database of bitcoin addresses annotated with their owners, we sketch the outlines of this burgeoning ecosystem and associated third-party infrastructure. In particular, we are able to trace the financial transactions, from the acquisition of bitcoins by victims, through the payment of ransoms, to the cash out of bitcoins by the ransomware operators. We find that many ransomware operators cashed out using BTC-e, a now-defunct Bitcoin exchange. In total we are able to track over $16 million USD in likely ransom payments made by 19,750 potential victims during a two-year period. While our study focuses on ransomware, our methods are potentially applicable to other cybercriminal operations that have similarly adopted Bitcoin as their payment channel.
The second meeting of ISO/TC 307 (International Organization for Standardization Technical Committee 307: blockchain and electronic distributed ledger technologies) was held in Tokyo in November 2017.This TC is working to develop international standards for blockchain technology.This article introduces the concept of blockchain technology-the fundamental technology used for bitcoin-as well as trends in the international standardization of electronic distributed ledger technologies and some applications of blockchain technology beyond cryptocurrency.
There are a lot of blockchain platform implementations available today. To be integrated into the smart space for Industrial IoT the blockchain platform should support not only token exchange but also smart contract distribution and launching, fault tolerance consensus mechanism and equivalence between participants to create and implement new blocks and contracts. The paper provides analysis of the most used consensus mechanisms, specific features of public (permissionless) and private (permissioned) blockchains. Also a description of blockchain platforms that satisfy the requirements for the IIoT platform development is provided. By the result of the analysis the platform and specific modules have been selected for implementation of blockchain for industrial IIoT platform.
Nicholas Stifter, Aljosha Judmayer, Philipp Schindler, Alexei Zamyatin · 5 authors
The term Nakamoto consensus is generally used to refer to Bitcoin’s novel consensus mechanism, by which agreement on its underlying transaction ledger is reached. It is argued that this agreement protocol represents the core innovation behind Bitcoin, because it promises to facilitate the decentralization of trusted third parties. Specifically, Nakamoto consensus seeks to enable mutually distrusting entities with weak pseudonymous identities to reach eventual agreement while the set of participants may change over time. When the Bitcoin white paper was published in late 2008, it lacked a formal analysis of the protocol and the guarantees it claimed to provide. It would take the scientific community several years before first steps towards such a formalization of the Bitcoin protocol and Nakamoto consensus were presented. However, since then the number of works addressing this topic has grown substantially, providing many new and valuable insights. Herein, we present a coherent picture of advancements towards the formalization of Nakamoto consensus, as well as a contextualization in respect to previous research on the agreement problem and fault tolerant distributed computing. Thereby, we outline how Bitcoin’s consensus mechanism sets itself apart from previous approaches and where it can provide new impulses and directions to the scientific community. Understanding the core properties and characteristics of Nakamoto consensus is of key importance, not only for assessing the security and reliability of various blockchain systems that are based on the fundamentals of this scheme, but also for designing future systems that aim to fulfill comparable goals.
Abstract Cryptocurrencies have experienced an exponential growth trend in the past 24 months, followed by a big crash. In the early years of the Internet, inspired entrepreneurs such as Jeffrey Bezos realized that, when something grows exponentially, it becomes ubiquitous within a short time span. Similarly to the Internet in 1994, cryptocurrencies have recently been growing at a dazzling rate, thus one can expect them to be used on a global scale very soon, in spite of the last bubble which has already burst. Alternative currencies are greeted with great enthusiasm, due to their potential to return financial power back to the people, especially in the context of general dissatisfaction and disappointment with the banking sector. They bring about several advantages, such as financial innovations, lower fees as well as increased availability to developing populations. At the same time, their high volatility and lack of supervision might imply that they only serve as complementary financing and not as a substitute of traditional banking. This article discusses the development of cryptocurrencies, including aspects related to Bitcoin, financial technology and the blockchain. Using historical data from Coinmarketcap.com between April 2013 and February 2018, I run a quantitative analysis of the distributions and evolution over time for all listed cryptocurrencies with known market capitalization. I look at the interplay between number of cryptocurrencies and market value, at growth rates, cumulative shares and volatility. I find a phenomenon of exponential growth and violent volatility, which I explain in light of cryptocurrencies’ strengths and weaknesses, as identified in the literature. I emphasize the importance of cryptocurrencies in the context of the global digital economy and I discuss future implications.
Pancy Thakur, Yash Pal Sharma, Seema Sharma, Chitra Bhardwaj
Block chain technology, an eminent technology in recent era is known for its well distributed, safe, secured ledger transaction and forgery proof data creation and its maintenance among the users. A block chain facilitates a public platform by providing it secured ledger system. It is commonly accessible and secured database to store and distribute information without any central controller. This article emphases on Block chain technology as a reliable, promising, transparent, error prone and as a distributed ledger technology towards agriculture sector and food product supply chains. However, the hitches of the Block chain technology are also highlighted which may hinder the widespread and open practice of this technology among farmers and the consumers in future. These hindrances could be overcome by intended use of Block chain technology experimentally as well as by simultaneous working on its feedback.
Nguyen B. Truong, Tai‐Won Um, Bo Zhou, Gyu Myoung Lee
In recent years, Blockchain has been expected to create a secure mechanism for exchanging not only for cryptocurrency but also for other types of assets without the need for a powerful and trusted third-party. This could enable a new era of the Internet usage called the Internet of Value (IoV) in which any types of assets such as intellectual and digital properties, equity and wealth can be digitized and transferred in an automated, secure, and convenient manner. In the IoV, Blockchain is used to guarantee security of transactions that the transactions are nearly impossible to be altered; thus it is impractical to retract once a transaction is confirmed. Therefore, to strengthen the IoV, before making any transactions it is crucial to evaluate trust between participants for reducing the risk of dealing with malicious peers. In this article, we clarify the concept of IoV and propose a trust-based IoV model including a system architecture, components and features. Then, we present a trust platform in the IoV considering two concepts, Experience and Reputation, originated from Social Networks for evaluating trust between two any peers in the IoV. The Experience and Reputation are characterized and calculated using mathematical models with analysis and simulation in the IoV environment. We believe this paper consolidates the understandings about IoV technologies and demonstrates how trust is evaluated and used to strengthen the IoV. It also opens important research directions on both IoV and trust in the future.
Christopher Kuner, Fred H. Cate, Orla Lynskey, Christopher Millard · 6 authors
It is not uncommon for technological developments to give rise to debates as to whether existing legal norms and regulatory frameworks will be disrupted or undermined. A recent, high-profile, example is blockchain. Most of the popular excitement about blockchain, so far at least, relates to crypto-currencies, especially Bitcoin, and related financial products such as Initial Coin Offerings (ICOs). Less visibly, but probably more importantly in the long run, a great deal of investment is going into the development of a broad range of blockchain applications in contexts ranging from registration of assets (including land) to self-executing (‘smart’) contracts. Notwithstanding widespread confusion about what exactly blockchain is or might become, blockchain and distributed ledger technologies (DLTs) have caught the imagination of governments, businesses, and private investors, and they are increasingly a focus of attention for legislators and regulators worldwide. Of specific relevance to this Journal is the question of how data protection concepts and rules will apply to blockchain and, indeed, whether it might prove to be impossible to build and deploy compliant blockchain applications to the extent that that they involve the processing of personal data. Indeed, Jan Philip Albrecht, a Member of the European Parliament who played a prominent role in the development and finalization of the European Union’s General Data Protection Regulation (GDPR), has asserted just that. In his view: Certain technologies will not be compatible with the GDPR if they don’t provide for [the exercising of data subjects’ rights] based on their architectural design. This does not mean that blockchain technology, in general, has to adapt to the GDPR, it just means that it probably can’t be used for the processing of personal data.1 We consider Albrecht’s views on blockchain as a technology for processing personal data to be overly negative. Whether personal data may be processed legitimately using blockchain technology will depend on the specific technical and organizational model that underpins a particular blockchain application. Before we can go any further, however, we need to clarify what we mean by the term blockchain. Unlike some other recently deployed technologies, such as cloud computing, as yet there is no widely accepted definition of blockchain. This is perhaps because blockchain technology is evolving rapidly and the term is used to cover a broad range of models for establishing and managing a ledger of transactions. Moreover, the term blockchain is often used interchangeably with other concepts such as DLT (see below regarding this concept). Above all, the lack of technical precision that often characterizes discussions of cryptocurrencies such as Bitcoin has resulted in widespread confusion as to what should, and should not, be regarded as an implementation of blockchain technology. It may be helpful to pare the concept down into three fundamental components. For our purposes, a blockchain is (i) a system for recording a series of data items (such as transactions between parties) that (ii) uses cryptography to make it difficult to tamper with past ledger entries, and that (iii) has an agreed process for storing one or more copies of the ledger and adding new entries. This process is usually called ‘consensus’, though that term may also be misleading. DLT refers to a particular type of blockchain system that is ‘distributed’ across several, potentially many, ‘nodes’ (ie individuals or organizations that hold a copy of the distributed ledger). ‘Consensus’ may be achieved in several different ways. These include the cumbersome and energy-intensive ‘proof of work’ model used by Bitcoin, whereby ‘miners’ compete to solve increasingly difficult computational puzzles as a basis for adding a new block to a chain, with the winner being rewarded in Bitcoin for doing so. Other key characteristics of Bitcoin are that it is open and ‘permissionless’, which means that anyone may, without authorization, use Bitcoin and, indeed, may participate in the network as a node. Widespread distribution of copies of the ledger, together with a consensus process that does not require any centralized, trusted, intermediary to manage the ledger, make Bitcoin and similar DLTs attractive as platforms for use by large numbers of parties who do not trust, indeed may not even be able to identify, each other. It is, however, the very openness, lack of permissioning, and potential anonymity that make public blockchain systems like Bitcoin problematic from a legal and regulatory perspective. For example, how can a financial services regulator check that anti-money laundering (AML) and know your customer (KYC) rules are being complied with if a large number of parties can transfer tokens between each other without involving any regulated entity or other intermediary that can be audited? In terms of data protection compliance, is each node that holds a copy of the distributed ledger a controller in respect of all personal data in the ledger? Might each node also, or instead, be a processor for the operator of every other node? What is the status of the users of an open cryptocurrency? Are they also all controllers and, if so, in what circumstances might they be excused from data protection compliance obligations because of an exemption such as that for processing in the course of a purely personal or household activity? How can controllers give instructions to processors regarding the processing of personal data when the parties may not even know who they are dealing with? Indeed, if thousands of nodes hold copies of data relating to transactions between millions of users how could they all contract with each other anyway? Given that a node or user may be anywhere on the planet, must it be assumed that any personal data in a distributed ledger might be transferred worldwide? Is the proliferation of copies of data in a DLT compatible with the data minimization principle? What happens if a data subject wishes to exercise an individual right, eg to correction or erasure of data if the relevant data are stored in an ‘immutable’ blockchain? Very few commentators have gone beyond identifying a selection of these questions and then concluding that data protection compliance in relation to blockchain is highly problematic, or simply impossible. Does this mean that Albrecht is right and that blockchain probably cannot be used for the processing of personal data? Not necessarily. Let us step away from the Bitcoin model and return to the core elements of blockchain as being a tamper-evident ledger that is established and maintained according to some kind of consensus protocol. Based on these fundamental elements, might it be possible to develop and deploy a blockchain system that is compatible with data protection by design principles? Perhaps. For example, instead of being public and permissionless, the blockchain might be set up by a consortium that is governed by rules that establish the basis on which each party will process any personal data that is included in the blockchain. Moreover, instead of a distributed consensus mechanism such as proof of work, the parties might agree to use some kind of ‘consensus by authority’ whereby one or more participants has the authority to add blocks to the chain, eg by each taking turns to do so. Indeed, that role might be outsourced to a trusted third party, perhaps even a cloud services provider that offers Blockchain as a Service (BaaS). It may even be possible to design a blockchain that is ‘redactable’ or ‘editable’ without undermining the core characteristic of being a tamper-evident ledger. These are not just hypothetical suggestions; blockchain arrangements are currently being established that have some or all of these features. So, as with many issues that arise in data protection law, the appropriate answer to the question of whether a blockchain may be used to process personal data is not binary but rather ‘It depends.’2
Abstract Access to housing is a crucial issue worldwide. It is still under discussion whether collaborative economy is enhancing or, on the contrary, constraining access. In this context, the concept of ‘collaborative housing’ (collaborative economy applied to the funding, access and organisation of housing) arises to address a range of situations that might potentially help people to access housing, such as co-housing or the so-called ‘intermediate tenures’. Disintermediation through blockchain technology, and the resultant effect of a reduction in the transaction costs of access to housing, is one of those trends regarding collaborative housing. Accordingly, the adaptation of the disintermediation mechanism to the real estate conveyance and land registry, as in many other sectors of the collaborative economy, is timely. This can be achieved by exploring the potential of this mechanism in enhancing traditional methods of this sector through possible technological solutions. This paper presents a preliminary discussion on the different types of collaborative housing and the potentials of the blockchain technology to facilitate access to housing in relation to real estate conveyancing and registration.
In this paper, we propose an architecture for Blockchain-based Electronic Medical Records (EMRs) called GAA-FQ (Granular Access Authorisation supporting Flexible Queries) that comprises an access model and an access authorisation scheme. Unlike existing Blockchain schemes, our access model can authorise different levels of granularity of authorisation, whilst maintaining compatibility with the underlying Blockchain data structure. Furthermore, the authorisation, encryption, and decryption algorithms proposed in the GAA-FQ scheme dispense with the need to use a public key infrastructure (PKI) and hence improve the computation performance needed to support more granular and distributed, yet authorised, EMR data queries. We validated the computation performance and transmission efficiency for GAA-FQ using a simulation of GAA-FQ against an access control scheme for EMRs called ESPAC as our baseline that was not designed using a Blockchain. To the best of our knowledge, GAA- FQ is the first Blockchain-oriented access authorisation scheme with granular access control, supporting flexible data queries, that has been proposed for secure EMR information management.
Dirk Andreas Zetzsche, Ross P. Buckley, Douglas W. Arner
One of the oft-noted benefits of distributed ledger technology is its security. Many commentators seem to believe that because the Bitcoin blockchain has not been hacked, somehow this means all blockchains are secure. This paper draws on recent examples to explore how risk persists when financial services are provided via distributed ledgers. We analyse the kinds of risk, how they arise and their possible legal consequences. While some technologists want to believe using blockchain will not give rise to legal liability, we demonstrate how this is not so. These liability consequences raise significant questions about how distributed ledgers should be structured, owned and, ultimately, regulated.
Fabio Massacci, Chan Nam Ngo, Jing Nie, Daniele Venturi · 5 authors
In a Futures-Exchange, such as the Chicago Mercantile Exchange, traders buy and sell contractual promises (futures) to acquire or deliver, at some future pre-specified date, assets ranging from wheat to crude oil and from bacon to cash in a desired currency. The interactions between economic and security properties and the exchange's essentially non-monotonic security behavior; a valid trader's valid action can invalidate other traders' previously valid positions, are a challenge for security research. We show the security properties that guarantee an Exchange's economic viability (availability of trading information, liquidity, confidentiality of positions, absence of price discrimination, risk-management) and an attack when traders' anonymity is broken. We describe all key operations for a secure, fully distributed Futures-Exchange, hereafter referred to as simply the 'Exchange'. Our distributed, asynchronous protocol simulates the centralized functionality under the assumptions of anonymity of the physical layer and availability of a distributed ledger. We consider security with abort (in absence of honest majority) and extend it to penalties. Our proof of concept implementation and its optimization (based on zk-SNARKs and SPDZ) demonstrate that the computation of actual trading days (along Thomson-Reuters Tick History DB) is feasible for low-frequency markets; however, more research is needed for high-frequency ones.
This article examines the characteristics of school effectiveness and how the school effectiveness policy works in the context of education decentralization. The research approach is qualitative exploratory and was conducted in 2016 in 10 out of 35 districts/cities in Central Java Province. The results showed that there are eight characteristics of effective schools: effective school leadership, efficient learning processes, active community participation, a conducive school environment, increased professionalism of educators, heightened expectations of students, the commitment of teachers, which together lead to good student achievement. Local government policy has not been mentioned explicitly to build an effective school. The government system should contribute to creating effective schools through human resource development, community participation, provision of facilities and infrastructure, professional development of educators, guiding students’ and teachers' achievement, monitoring student progress, education financing to some degree, and the commitment of local governments to give appreciation to education actors.
Abstract The goal of the paper is to provide a vague summary of currently existing blockchain use cases in the information technology industry. Respective use cases have been examined in already existing scientific papers, Master Theses, industry white papers and blogs of industry experts. The paper also contains a description of blockchain main technological aspects and working principles, which allows making the assessment of the presented use cases. For each use case respective companies or organisations are added that are applying or testing the given solution. Due to research limitations the paper should not be considered an exhaustive blockchain use case description. The paper also provides short introduction into a feasibility analysis of specific blockchain use case. The authors describe the basic steps of potential idea evaluation with regards to blockchain main aspects. It helps understand the necessity for development of a detailed blockchain feasibility model.
Maxim Ya. Afanasev, Anastasiya A. Krylova, Sergey A. Shorokhov, Yuri V. Fedosov · 5 authors
The concept of cyber-physical production systems is highly discussed amongst researchers and industry experts, however, the implementation options for these systems rely mainly on obsolete technologies. Despite the fact that the blockchain is most often associated with cryptocurrency, it is fundamentally wrong to deny the universality of this technology and the prospects for its application in other industries. For example, in the insurance sector or in a number of identity verification services. This article discusses the deployment of the CPPS backbone network based on the Ethereum private blockchain system. The structure of the network is described as well as its interaction with the help of smart contracts, based on the consumption of cryptocurrency for various operations.