Natalia Dashkevich, Steve Counsell, Giuseppe Destefanis
Blockchain is a novel technology capturing the attention of Central Banks and a technology with significant disruptive potential. However, a gap in research effort between practitioners and academics seems to have emerged. This paper analyses and maps that gap by exploring trends in peer-reviewed research contributions through thematic categorisation of academic literature on Distributed Ledger Technology (DLT) use-cases for services, operations and functions performed by central banks. Furthermore, this paper provides summaries of opportunities and challenges for central banks arising from blockchain adaptation to each of those use-cases. To achieve this goal, we utilise a Systematic Mapping Study approach. The paper presents an in-depth assessment of statistical and thematic analysis of research maturity and the types of researchers, with specific emphasis on types of central bank use-cases considered for blockchain adaptation. Our work contributes to an understanding of where the most or least attention is directed, allowing for identification of gaps and opportunities for both academics, practitioners and combinations of each. Results show that the research topic is a comparatively new domain. It confirms the gap between depth and volume of the research provision from industry and academia, with industry leading the trend. Our study also found that the most research-intensive use-cases are those for: 1) Central Bank issued Digital Currency (CBDC), 2) Regulatory Compliance and 3) Payment Clearing and Settlement Systems (PCS) operated by central banks; a comparatively low engagement was found in the areas of 4) Assets Transfer/Ownership and 5) Audit Trail.
In this research, the evolution of Distributed Ledger Technology (DLT) in supply chains has been mapped from the inception of the technology until June 2020, utilising primarily public data sources. Two hundred seventy-one blockchain projects operating in the supply chain have been analysed on parameters such as their inception dates, types of blockchain, stages reached, sectors applied to and type of organisation that founded the project. We confirm generally understood trends in the blockchain market with the creation of projects following the general hype and funding levels in the industry. We observe most activity in the Agriculture/Grocery sector and the Freight/Logistics sector. We see the shift of market interest from primarily private companies (startups) to public companies and consortia and the change in blockchain adoption from Ethereum to Hyperledger. Finally, we observe higher success and lower failure rates for Hyperledger-based projects in comparison to Ethereum-based projects.
As a decentralized distributed ledger, blockchain has developed rapidly since its birth and has been highly valued by governments, academia, and industry. Start in the financial field, blockchain technology has been rapidly applied to various fields such as the Internet of Things, supply chain, and healthcare. Blockchain technology has made sufficient development and innovation, but it also faces many challenges, such as security, scalability, and waste of resources. This paper starts with the development history of blockchain and combines the characteristics and technical principles of it to analyze the current academic research status and application scenarios. Meanwhile, this paper analyzes the existing outstanding blockchain projects and elaborates on their key advantages and current challenges. With discussing the ongoing development trend of blockchain, the development direction, and the research trend of blockchain in the future, this paper provides a useful reference for related research.
Mahmood A. Rashid, Krishneel Deo, Divnesh Prasad, K. Ranjith Singh · 6 authors
Abstract Blockchain is an emerging technology framework for creating and storing transaction in distributed ledgers with a high degree of security and reliability. In this paper, we present a blockchain-based platform to create and store contracts in between students and their higher education sponsors facilitated by intermediary brokers denoted as fundraisers. The sponsorship might be in any form, such as scholarship, donation, or loan. The fund will be arranged and managed by a group of competitive fundraisers who will hold the distributed ledgers and act as the miners in the blockchain network.
Many recent social media posts and news may create a perception of big success in the use of blockchain for the real estate industry, land registration and protection of titles and property rights. A sobering outlook is crucial because misleading concepts may bury the whole idea of blockchain use. The paper aims to research the possibilities of blockchain and other distributed ledger technologies (DLT) and applicability of these technologies for different purposes in real estate, property rights and public registries. Blockchain, which is distinguished from permissioned systems as the technology of the immutable ledger that does not require authorities, is a new word in governance. However, this technology has some principal features that can restrain its implementation at the state level, and thus require further research and development. The application of blockchain requires a proper architecture of overlaid technologies to support changes of outdated and mistaken data, address issues of digital identity and privacy, legal compliance and enforceability of smart contracts and scalability of the ledger. This paper shows the constraints of the technology's properties which were not explained before in the context of title rights and land registration even though technological limits are known in more specific technical sources. Along with the known benefits this meant to help to avoid misinterpretation of some DLT features by non-technical people. A multidisciplinary approach in analysing the technology and laws helped to better understand what can and cannot be beneficial for public registries and the protection of property rights. The presented outcomes can be laid down as requirements for the technical protocols aimed at addressing the issues of DLT and public policies to put blockchain at the service of society.
The rapid development of digital technologies such as blockchain and distributed ledger-based systems holds transformative potential for the financial sector. Promising applications include asset management as well as peer-to-peer networks for the transparent exchange of data and information. International climate finance stands to benefit in particular ways from these new opportunities in financial technology. Distributed ledger technologies could be leveraged to support climate action, for example by facilitating transparent and standardized transactions, or by enabling more efficient monitoring and accreditation processes. In view of these promising opportunities, we focus our inquiry on the case of the Green Climate Fund to explore how distributed ledger technologies can be used for innovative climate finance. Based on our analysis of different digital system models and potential use cases, we then discuss some of the technical and political challenges that may arise, for example with regard to standards and safeguards, governance processes, country ownership, and further capitalization. Our findings show that distributed ledger-based systems could benefit the work of the fund in key areas such as multi-stakeholder coordination and impact assessment. However, our analysis also points to the concrete limitations of technology driven solutions. Digital technologies are not a standalone solution to persistent resource allocation and governance challenges in international climate finance, especially because the design and deployment of these digital systems is inherently political.
Abstract We make a distinction between centralized, decentralized, and distributed payment mechanisms. A centralized payment mechanism processes a transaction using a trusted third party. A decentralized payment mechanism processes a transaction between the parties to the transaction. A distributed payment mechanism relies on the network of users to process a transaction on a shared ledger. We maintain that bitcoin is neither a centralized nor a decentralized payment mechanism. It is, instead, a distributed payment mechanism. We then consider decentralized and centralized aspects of the broader bitcoin payment space.
The modern financial technology (“FinTech”) revolution has two features that distinguish it from previous eras of innovation: (1) Consumers have greater access to financial information and applications using smartphones on high-speed networks; and (2) businesses benefit from dramatically lower costs, improved performance, and enhanced options in data storage, computation, and application development. The once monolithic and proprietary financial services industry is being challenged under the zeitgeist of decentralization, disintermediation, and open protocols. Consequently, households in the United States are witnessing the emergence of new options for investment, credit, insurance, and payments. We illustrate how several influential FinTech trends may help address biases and constraints that hamper households in smoothing intertemporal consumption.
Education plays a vital role in human life. To encourage higher education, the Indian government has taken many initiatives. These include the disbursement of scholarships to financially help the students belonging to low-income families. Central Sector Scheme of Scholarship for College and University Students (CSS) is one such scheme that financially helps meritorious students in pursuing graduation and post-graduation. This scheme was introduced in 2008. Scholarships from CSS have been helping students to fund their educational expenses. But there have been some difficulties faced by the students in availing this scholarship. These include lack of traceability of application form, loss of application form in transit through Indian Postal Service, lack of transparency between students and their respective Education Boards, and lack of bank account verification. In this paper, we propose a Smart Contract for CSS Scheme that overcomes the above-mentioned drawbacks. It has four entities: Students, Education Boards, Colleges, and Banks. The Blockchain-based Smart Contract proposed in this paper, has been developed to provide a user-friendly environment to a student and maintain a transparent and constant connection between students and their respective Education Boards. Many applications have been developed on the Blockchain platform but to the best of our knowledge, there does not exists any government scholarship scheme on the Blockchain platform in India.
The main quality of a smart contract relies on the automation of contractual relationships, as the performance is triggered by an algorithm in turn triggered by the fulfilment of certain events. Most of the benefits arising from smart contracts are based on the ‘self-executing’ and ‘self-enforcing’ character, which represent a source of innovation for general contract law. Smart contracts use blockchain to ensure the transparency of the contractual relationship and to create trust in the capacity to execute the contract, which depends on the technology used. The aim of the present essay is to investigate whether and how blockchain technology platforms and smart contracts could be considered a modern form of private authority, which at least partially escapes the application of mandatory rules and traditional enforcement mechanisms. In particular, the authors will devote attention to innovative self-help mechanisms and dispute resolution systems, which can be depicted as ‘alternative’ insofar as they present themselves as independent from courts and other national state authorities.
Ariah Klages‐Mundt, Dominik Harz, Lewis Gudgeon, Junyou Liu · 5 authors
Stablecoins are one of the most widely capitalized type of cryptocurrency. However, their risks vary significantly according to their design and are often poorly understood. We seek to provide a sound foundation for stablecoin theory, with a risk-based functional characterization of the economic structure of stablecoins. First, we match existing economic models to the disparate set of custodial systems. Next, we characterize the unique risks that emerge in non-custodial stablecoins and develop a model framework that unifies existing models from economics and computer science. We further discuss how this modeling framework is applicable to a wide array of cryptoeconomic systems, including cross-chain protocols, collateralized lending, and decentralized exchanges. These unique risks yield unanswered research questions that will form the crux of research in decentralized finance going forward.
Advancements in the digital domain, for example in blockchain technology, big data and machine learning, are increasingly shaping the lives of individuals, groups, organizations, and societies. These developments call for effective governance to protect the basic interests and needs of these actors. Simultaneously, the very nature of governance is also changing. Policy-making is increasingly moving away from top-down governance by the state towards more horizontal modes of governance. This paper reviews the literature on governance theory in order to conceptualize governance as a mode of decentralized, networked regulation. We argue that the current dominant modes of governance are inadequate in understanding governance in the digital domain, and are poorly equipped to conceptualize novel forms of governance such as decentralized autonomous organizations (DAOs). Therefore, this study proposes a new mode of governance based on the regulation of new power relationships between the state and actors in the digital domain. This model further explores the role that blockchain technology can play in what we term decentralized network governance.
The progress of ICT technologies, day-ahead forecast, home energy management systems, implementation of smart meters, and Distributed Energy Sources (DER) enables new business opportunities for prosumers to locally trade the surplus via blockchain platforms leading to considerable advantages at the community level. The current research handles settlement similar to a centralized market that it is not necessarily the best solution for blockchain. Nonetheless, the settlement is essential as sellers and buyers perceive the attractiveness of the local trading through the market results. In this paper, we propose two novel and efficient settlement mechanisms (Global Balancing Settlement GBS and Splitting Settlement SS) for Peer-to-Peer (P2P) electricity exchange enhancing the performance of the classic Pairwise Settlement PS. These will be written as stored procedures embedded into the smart contracts along with auctioning procedures. The simulations are performed using a small residential community with 30% of the electricity that can be locally traded to lower the bills and unstress the public grid. The performance of the two proposed settlement methods is proved by the 14 scenarios that thoroughly indicate that GBS and SS provide better results for both sellers and buyers than PS. In the reference scenario, with GBS, sellers have the highest encashments with almost 4% more, whereas buyers encounter the lowest payments with almost 5% less than in case of the classic settlement. Starting from reference scenario, alternative scenarios are envisioned to extend the analyses and assess the performance of the settlement mechanisms. The highest gain is recorded with GBS mechanism: almost 8.8% for sellers and 6.5% for buyers. Another interesting outcome is that GBS is providing better results than SS. When deviations are small, SS provides almost 6% gain for both sellers and buyers, but when they increase, the gain is exceedingly small or none.
More than eight million smart contracts have been deployed into Ethereum, which is the most popular blockchain that supports smart contract. However, less than 1% of deployed smart contracts are open-source, and it is difficult for users to understand the functionality and internal mechanism of those closed-source contracts. Although a few decompilers for smart contracts have been recently proposed, it is still not easy for users to grasp the semantic information of the contract, not to mention the potential misleading due to decompilation errors. In this paper, we propose the first system named STAN to generate descriptions for the bytecodes of smart contracts to help users comprehend them. In particular, for each interface in a smart contract, STAN can generate four categories of descriptions, including functionality description, usage description, behavior description, and payment description, by leveraging symbolic execution and NLP (Natural Language Processing) techniques. Extensive experiments show that STAN can generate adequate, accurate, and readable descriptions for contract's bytecodes, which have practical value for users.
Purpose: The paper aims to review the academic research work done in the area of Islamic financial technology. The Islamic FinTech area has been classified into three broad categories of the Islamic FinTech, Islamic Financial technology opportunities and challenges, Cryptocurrency/Blockchain sharia compliance and law/regulation. Finally, the study identifies and highlights the opportunities and challenges that Islamic Financial institutions can learn from the conventional FinTech organization across the world. Approach/Methodology/Design: The study collected 133 research studies (50 from Social Science Research Network (SSRN), 30 from Research gate, 33 from Google Scholar and 20 from other sources) in the area of Islamic Financial Technology. The study presents the systematic review of the above studies. Findings: The study classifies the Islamic FinTech into three broad categories namely, Islamic FinTech opportunities and challenges, Cryptocurrency/Blockchain sharia compliance and law/regulation. The study identifies that the sharia compliance related to the cryptocurrency/Blockchain is the biggest challenge which Islamic FinTech organizations are facing. During our review we also find that Islamic FinTech organizations are to be considered as partners by the Islamic Financial Institutions (IFI’s) than the competitors. If Islamic Financial institutions want to increase efficiency, transparency and customer satisfaction they have to adopt FinTech and become partners with the FinTech companies. Practical Implications: The study will contribute positively to the understanding of Islamic Fintech for the academia, industry, regulators, investors and other FinTech users. Originality/Value: The study believes to contribute positively to understanding of Fintech based technology like cryptocurrency/Blockchain from sharia perspective.
Mohammad Madine, Ammar Battah, Ibrar Yaqoob, Khaled Salah · 8 authors
Personal health records (PHRs) are valuable assets to individuals because they enable them to integrate and manage their medical data. A PHR is an electronic application through which patients can manage their health information. Giving patients control over their medical data offers an advantageous realignment of the doctor-patient dynamic. However, today's PHR management systems fall short of giving reliable, traceable, trustful, and secure patients control over their medical data, which poses serious threats to their authenticity and accuracy. Moreover, most of the current approaches and systems leveraged for managing PHR are centralized that not only make medical data sharing difficult but also poses a risk of single point of failure problem. In this paper, we propose Ethereum blockchain-based smart contracts to give patients control over their data in a manner that is decentralized, immutable, transparent, traceable, trustful, and secure. The proposed system employs decentralized storage of interplanetary file systems (IPFS), proxy re-encryption, and trusted reputation-based oracles to securely fetch, store, and share patients' medical data. We present algorithms along with their full implementation details. We evaluate the proposed smart contracts using two important performance metrics, such as cost and correctness. Furthermore, we provide security analysis and discuss the generalization aspects of our solution. We outline the limitations of the proposed approach. We make the smart contract source code publicly available on Github.
Being the most popular permissionless blockchain that supports smart contracts, Ethereum allows any user to create accounts on it. However, not all accounts matter. For example, the accounts due to attacks can be removed. In this paper, we conduct the first investigation on erasable accounts that can be removed to save system resources and even users' money (i.e., ETH or gas). In particular, we propose and develop a novel tool named GLASER, which analyzes the State DataBase of Ethereum to discover five kinds of erasable accounts. The experimental results show that GLASER can accurately reveal 508,482 erasable accounts and these accounts lead to users wasting more than 106 million dollars. GLASER can help stop further economic loss caused by these detected accounts. Moreover, GLASER characterizes the attacks/behaviors related to detected erasable accounts through graph analysis.
Blockchain technology has been an essential aspect for research due to its, peer to peer nature, distributed nature, and decentralization, some of its applications are Supply chain, Healthcare System, Real state, etc. Ethereum is a distributed public blockchain network that focuses on running the code of any decentralized application. A smart contract is a computer program having self-verifying, self-executing, tamper-resistant properties. Initial Coin Offering (ICO) is a process similar to crowdfunding, in which companies raise funds from investors, who, in exchange receive tokens or digital assets. This paper deals by explaining the proposed model, different functions of ERC20 standard, the different tasks performed by each function and implementing various functionalities of ERC20 Token in Solidity.
We document ongoing research on a digital artefact comprising a settlement layer for financial contracts traded over the counter (OTC). Working with a team of stakeholders from a hosting organization we employ the design science research methodology (DSR) in the design, implementation and evaluation of a DLT based settlement layer for OTC contracts. Our findings indicate that DLT may serve towards reducing execution costs while mitigating counterparty credit risk through deterministic automation of key processes in the OTC contract lifecycle. Extrapolating these early results, we introduce three general propositions on the systemic and commercial implications of DLT. We contribute to the broader IS discourse on the capacity for emerging digital technologies to upend traditional knowledge processes in the financial services.
We present Value Token Transfer Protocol (VTTP), a decentralized finance protocol for exchange of value or tokens within and between participating blockchain networks, fiat bank accounts and fiat wallets. The protocol allows intra-chain or inter-chain transfers of cryptocurrencies or tokens. VTTP works in both client-server and peer-to-peer models. The protocol comprises receiving from a client a transfer request to transfer value in a form of a cryptocurrency or a token, determining if the transfer request is intra-chain or inter-chain, transmitting to the client a response to the transfer request, the response comprising a raw transaction, receiving from the client a response to the raw transaction wherein a private key of a user is used to sign the raw transaction, defining a signed transaction, verifying a signature of the signed transaction and broadcasting the signed transaction to the sending and receiving blockchain networks.
Gang Tian, Qibo Wang, Yi Zhao, Lantian Guo · 6 authors
With the number of smart contracts growing rapidly, retrieving the relevant smart contracts quickly and accurately has become an important issue. A key step for recognizing the related smart contracts is able to classify them accurately. Different from traditional text, the smart contract is composed of several parts: source code, code comments and other useful information like account information. How to make good use of those different kinds of features for effective classification is a problem need to be solved. Inspired by this, we proposed a smart contract classification approach based on Bi-LSTM model and Gaussian LDA, which can use a variety of information as inputs of the model, including source code, comments, tags, account and other content information. Bi-LSTM is utilized to capture grammar rules and context information in source code, while Gaussian LDA model is employed to generate comments feature where the semantics of the comments are enriched by embeddings. We also use attention mechanism to focus on the more relevant features in smart contracts for tags and fuse account information to provide additional information for classification. The experimental results show that the classification performance of the proposed model is superior to other baseline models.