Nikos Fotiou, Vasilios A. Siris, Spyros Voulgaris, George C. Polyzos · 5 authors
We address the limitations of existing information security solutions when applied to the cyber-physical world. In particular, we consider the case of Internet of Things (IoT) actuation and we argue that it is hard to secure such a process. To this end, we propose a "damage control" approach, where service time is divided into slots and users perform microservice transactions, paying essentially in advance for each one, corresponding to one service slot. Under these circumstances, in the case of service disruption, a user, in the worst case, may lose the amount of money that corresponds to a single micro-service transaction in a single time slot. We implement our solution by leveraging blockchain-based smart contracts, off-chain payments, and one-time Hash-based Message Authentication Code (HMAC) passwords. Our solution supports IoT devices with limited processing capabilities and which are not necessarily connected to the Internet. Moreover, with our solution, IoT devices do not interact directly with the blockchain. In fact, they are oblivious to the use of blockchain technology. They do not store any usersensitive information, neither are payments made to or is value stored on the devices.
The global crypto marketplace has an impact on the functioning of financial markets and has huge implications for entire economies. The article discusses the functioning of the global cryptocurrency market, and based on the analysis of the history of the most popular cryptocurrency, bitcoin, an attempt was made to determine possible development prospects. The aim of the article is to assess the development of the current crypto marketplace in the world and to present possible development prospects. The foresight method was used to implement the research objective, in particular trend analysis (quantitative data) and discrete event system (qualitative and expert data). This allows us to learn about the regularity of the cryptocurrencies in the sphere of investment management from the investors' point of view and the creation of an appropriate legal framework by the supervisory authorities and ensuring the social security of the financial system.
Can social movements mobilize market devices to challenge the politicalâeconomic order? Focusing on Bitcoin, we argue that an effective anti-state market device needs to be durably âcounterearmarkedâ, to use Viviana Zelizerâs term, with radical meaning. This durability, however, requires that the movement build alliances with holders of political and economic power who also embrace the deviceâs radical meaning, lest those actors reformat the device to suit their purposes. To make this case, we locate Bitcoinâs radical origins in a performative project built on elements of Austrian monetary theory. We then track Bitcoinâs dual transformation between 2009 and 2014: the anti-state movement gave way to a market featuring big financial players, and the Internal Revenue Service officially redefined the bitcoin currency as property. Understanding this dual transformation requires joining Zelizerian conceptions of money with theories of markets-and-movements on the one hand, and symbolic-cultural conceptions of the classificatory state on the other.
Disorientation and instability characterize the globalized context in which the relations of corporate governance are carried out today. Suffocated by the huge numerical and qualitative dimension of data to be analysed, companies need organizational systems and tools that allow them to interface with this reality. Through the creation of decentralized and more efficient systems able to process information at a higher speed than any human, Blockchain and artificial intelligence are the answer to these renewal requests. This paper aims to analyse the possible implications of the adoption of these technologies within the corporate governance relations, supporting how they can constitute effective and necessary support to the current organizational systems and, at the same time, how they are not yet able to replace them completely. Such a hypothesis would lead to the constitution of information oligarchies, would expose the shareholders to AIâs errors or manipulations by removing any management responsibility and, ultimately, to the creation of autonomous markets driven exclusively by economic purposes of the IT protocols that constitute them
Our study on smart contracts, self-executing agreements based on blockchain technology, can be placed in the field of inquiry within law and economics of contracts which explores new modes of contract enforcement as sources of market creation. We lay the foundations by characterising contract enforcement and trust mechanisms underlying contracts. Considering that trust reduces risks in economic exchange, we explain how the particular trust mechanism underlying smart contractsâ enforcement (no-party trust) provides opportunities for creating new markets and changing existing ones. We explore, among other things, whether using smart contracts could be a path to increasing the autonomy of consumers and offering a solution for democratising trade.
Cryptocurrencies employ different consensus protocols to verify transactions. While the Proof-of-Work consensus protocol is the most energy consuming protocol, Proof-of-Stake and Hybrid consensus protocols have been introduced which consume considerably less energy. We employ portfolio analysis to explore whether energy is a fundamental economic factor affecting cryptocurrency prices. Surprisingly, our results suggest that, on average, cryptocurrencies employing Proof-of-Work consensus protocols do not generate returns that are significantly different from those that incorporate Proof-of-Stake consensus protocols. Even more surprising is that our results show that cryptocurrencies that incorporate Hybrid consensus protocols generated significantly higher average return than the other groups. A possible explanation for that phenomenon may be that investorsâ demand for cryptocurrencies that they perceive as offering more trust is larger than for those that carry potential risks of blockchain manipulation.
Henry Kim, Marek Laskowski, Michael Zargham, Hjalmar Turesson · 6 authors
The study of setting up cryptocurrency incentive mechanisms and operationalizing governance is called token economics. Given the US$250 billion market cap for cryptocurrencies, there is compelling need to investigate it. In this article, we present facets of the token engineering process for a Swiss blockchain startup.
In October 2008 a mysterious article was published under the pseudonym Satoshi Nakamoto: âBitcoin: a peer-to-peer electronic cash systemâ. Bitcoinâs entry into operation some months later in early 2009 barely caused a ripple. Since then, the scheme has accumulated more than half a million blocks in its blockchain and they include more than 300 million transactions. In view of the media impact of Bitcoin, it is worth explaining in some detail how Bitcoin works and what its limitations are. This article reviews the aims and basic functioning of Bitcoin, analyses its strengths and weaknesses, and discusses its usefulness as an exchange mechanism.
Blockchain, or âdistributed ledgerâ technology, has been devised as an alternative to the law of finance. While it has become clear by now that regulation in the public interest is necessary, for example to avoid money laundering, drug dealing or tax evasion, the particularly thorny issues of private law have been less discussed. These include, for instance, the right to reverse an erroneous transfer, the ownership of stolen coins and the effects of succession or bankruptcy of a bitcoin holder. All of these questions require answers from a legal perspective because the technology ignores them. Particular difficulties arise when one tries to apply a property analysis to the blockchain. Surprisingly, it is far from clear how virtual currencies and other crypto assets are transferred and acquired. The traditional requirements posed by private law, such as an agreement between the parties and the transfer of possession, are incompatible with the technology. Moreover, the idea of a "void" or "null" transfer is hard to reconcile with the immutability that characterizes the blockchain. Before any such questions can be answered, it is necessary to determine the law governing blockchain transfers and assets. This is the point where conflict of laws, or âprivate international lawâ, comes into play. Conflicts lawyers are used to submitting legal relations to the law of the country with the most significant connection. But seemingly insurmountable problems occur because decentralized ledgers with no physical connecting factors do not lend themselves to this type of âlocalizationâ exercise. The issue of this paper therefore is: How can blockchain be squared with traditional categories of private law, including private international law? The proposal made herein avoids the recourse to a newly fashioned "lex digitalis" or "lex cryptographica". Rather, it is suggested that the problems can be solved by using existing national laws, supplemented by an international text. At the same time, the results produced by DLT should also be accepted as legally protected and corrected only where necessary under the applicable national rules. In this way, a symbiosis between private law and innovative technology can be created.
Karl WĂŒst, Loris Diana, Kari Kostiainen, Ghassan Karame · 6 authors
In this paper, our main goal is to design a solution that adds expressive smart contract execution support as a subsystem to existing legacy blockchain systems. The primary usage of our solution is to enhance systems like Bitcoin that have no built-in smart contract capabilities. The secondary usage is to extend the contract execution capabilities of platforms like Ethereum that support contracts but have severe limitations on the complexity of allowed computations.
The rise and continued implementation of cryptocurrencies and other cryptoassets is having, and will continue to have, a disruptive impact on the accounting, federal income taxation, and broader financial services industries. Much has been written, researched, and discussed about both cryptocurrencies and the underlying blockchain technology, but uncertainty remains as it pertains to how these items should be reported for accounting and tax purposes. What this research attempts to accomplish, through both a review of the literature and publicly available guidance issued by tax and accounting authorities, is to document and analyze what current guidance represents for financial reporting. Additionally, this research proposes how future iterations of cryptoassets and cryptocurrencies might be reported, with recommendations applicable for both practitioners and academics seeking to expand on this work.
David Allessie, Maciej Sobolewski, Lorenzino Vaccari
In less than ten years from its advent in 2008, the concept of distributed ledgers has entered into mainstream research and policy agendas. Enthusiastic reception, fuelled by the success of Bitcoin and the explosion of potential use cases created high, if not hyped, expectations with respect to the transformative role of blockchain for the industry and the public sector. Growing experimentation with distributed ledgers and the emergence of the first operational implementations provide an opportunity to go beyond hype and speculation based on theoretical use cases. This report looks at the ongoing exploration of blockchain technology by governments. The analysis of a group of pioneering developments of public services shows that blockchain technology can reduce bureaucracy, increase the efficiency of administrative processes and increase the level of trust in public recordkeeping. Based on the state-of-art developments, blockchain has not yet demonstrated to be either transformative or even disruptive an innovation for governments as it is sometimes portrayed. Ongoing projects bring incremental rather than fundamental changes to the operational capacities of governments. Nevertheless some of them offer clear value for citizens. Technological and ecosystem maturity of distributed ledgers have to increase in order to unlock the transformative power of blockchain. Policy agenda should focus on non-technological barriers, such as incompatibility between blockchain-based solutions and existing legal and organizational frameworks. This principal policy goal cannot be achieved by adapting technology to legacy systems. It requires using the transformative power of blockchain to be used to create new processes, organizations, structures and standards. Hence, policy support should stimulate more experimentation with both the technology and new administrative processes that can be re-engineered for blockchain.
The aim of this research is to bring the reader closer to several concepts that are becoming more common day by day, and which find themselves in unstoppable development, such as blockchain technology, tokens, ICO (Initial Coin Offerings) or DAO (Decentralized Autonomous Organizations). Thus, the process of «tokenization», based on abstractly representing a value through the blockchain, is a transcendental innovation in areas such as the financial or the corporate spheres, where ICO âintroducing a new business financing channel through the online sale of cryptographic assetsâ or DAO âentities managed in a decentralized way through smart contracts by tokens holdersâ come onto the scene. Likewise, their undeniable utilities will be enhanced, but the practical problems faced by these technological developments will also be analyzed, being the main one the regulatory uncertainty.
Blockchain startups are basing their business models on disrupting the centralized way of data storage by highlighting the value of data to the public. A distributed approach to storing data is the safer way to prevent attacks is what is being evangelized. GAFA (Google, Apple, Facebook, Amazon) have monopolized data, therefore bringing in the most revenue whilst depriving the data generators of any form of compensation. In our work, we propose a platform where a user can store his/her own personal data. Here, we present to the user the right to decide what happens to their data. These decisions include selling, renting, and deleting data. The deletion of data undermines the fundamentals the blockchain is built on (data immutability). We address the issues of personal data sharing and how a user's right to delete his/her data can be enforced in a blockchain based network such as ours.
Alain YeeâLoong Chong, Eric T.K. Lim, Xiuping Hua, Shuning Zheng · 5 authors
Blockchain technology, despite its origins as the underlying infrastructure for value transfer in the era of cryptocurrency, has been touted as the main disruptive force in modern businesses. Blockchain has the capacity to chronologically capture and store transactional data in a standardized and tamper-proof format that is transparent to all stakeholders involved in the transaction. This, in turn, has prompted companies to rethink preexisting business practices, thereby yielding a myriad of fascinating business models anchored in blockchain technology. In this study, we advance contemporary knowledge of business applications of blockchain by drawing on the theoretical lens of the digital business model and value configuration to decipher how pioneers in this space are leveraging blockchain to create and capture value. Through a comparative, multiple case study approach, we analyzed five companies in mainland China that have rolled out blockchain initiatives. From our case analyses, we derived a typology of five blockchain-inspired business models, each of which embodies a distinctive logic for market differentiation. For each business model, we offer insights into its value creation logic, its value capturing mechanism, and the challenges that could threaten its longer-term viability. Grounded in our findings, we discuss key implications for theory and practice.
Blockchain, Smart Contracts and Distributed Ledger Technology (DLT) are being touted to revolutionise digital services - through decentralisation. Cryptocurrencies, self-sovereign identities, decentralised certificate registries, and transparent voting systems are but a few applications which promise to empower endusers and provide assurances that neither data nor the associated computational logic have been tampered with. Decentralisation, disintermediation, transparency, verifiability, auditability, openness, inclusion, tamper-proof, immutability are just some of the buzz words that continue to be swung around in the promotion of the benefits brought about by Blockchain-based systems to the users. The rhetoric used creates parallels between the features brought about through blockchains and values that many try to uphold, for example honesty, openness, transparency, teamwork and unchanging truth. In this paper a number of blockchain applications aimed at supporting initiatives for common good are highlighted. This is followed by a discussion on technology de/centralisation and a thought experiment used to raise questions regarding the use of decentralised technology in terms of social implications.