Aim/Purpose: This paper explored the factors (enablers and barriers) that affect Bitcoin adoption in South Africa, a Sub-Saharan country with the high potential for Bitcoin adoption. Background: In recent years, Bitcoin has seen a rapid growth as a virtual cryptocurrency throughout the world. Bitcoin is a protocol which allows value to be exchanged over the internet without a central bank or intermediary. Cryptocurrencies such as Bitcoin are technological tools that arguably can contribute to reducing transactions costs. This paper explored the factors that affect Bitcoin adoption in South Africa, a Sub-Saharan country with the high potential for Bitcoin adoption, as little is known about the factors that affect Bitcoin adoption and the barriers to adoption. Methodology: A quantitative questionnaire was distributed to South African virtual communities where Bitcoin is a topic of interest, and 237 quantitative responses were received, along with 212 open-ended comments. Contribution: This research contributes to the body of knowledge in information systems by providing insights into factors that affect Bitcoin adoption in South Africa. It raises awareness of incentives and barriers to Bitcoin adoption at a time when financial literacy is a crucial issue both in South Africa and worldwide. Findings: The results indicate that perceived benefit, attitude towards Bitcoin, subjective norm, and perceived behavioral control directly affected the participants’ intentions to use Bitcoin. Perceived benefit, usefulness, ease of use, and trust-related risk were found to indirectly affect intention to use Bitcoin. Further, it emerges that the barriers to Bitcoin adoption in South Africa consist of the complex nature of Bitcoin and its high degree of volatility. Recommendations for Practitioners: Bitcoin can contribute to reducing transactions costs, but factors that affect adoption and the barriers to adoption should be taken into consideration. These findings can inform systems and software developers to develop applications that make managing Bitcoin keys and transacting using Bitcoin less complex and more intuitive for end users. Recommendation for Researchers: Bitcoin adoption in South Africa is a topic that has not been previously researched. Researchers could research similarities or differences in the various constructs that were used in this research model. Impact on Society: South African Bitcoin users consider it as a universal currency that makes cross-border payments cheaper. A large number of refugees and workers in South Africa make regular payments across borders. Bitcoin could reduce the costs of these transfers. Future Research: Future research could explore Bitcoin (and other cryptocurrencies) adoption in other developing countries. Researchers could look at factors that influence cryptocurrency adoption in general. The factors affecting adoption of other cryptocurrencies can be compared to the results of this study, and similarities and differences can thus be identified.
This article presents a brief overview of the Distributed Ledger Technology, Token Offering and their regulation, if any, in four main jurisdictions, the United States (U.S.), Switzerland, the European Union (EU), and Singapore. It should be noted that is expected to have new developments on the regulatory side, in this and other jurisdictions, of Distributed Ledger Technology and token offerings, Malta, for example, has recently officially stated the creation of the Malta Digital Innovation Authority that will be responsible to regulate and incentivize this industry in Malta and the EU. Distributed Ledger Technology and token offerings are fairly new concepts and are revolutionizing different industries at an incredibly fast pace. The regulators, as well as all other stakeholders, must maintain attention and remain vigilant to any developments in this regard. Conclusively, the Distributed Ledger Technology will, undoubtedly, bring innovative solutions to different industries, especially the financial services industry. As analyzed in the present article, key components previous to launching a token offering, are: define the jurisdiction that will be used for the corporate structure; the categorization of the token; and the applicable regulation accordingly.
The blockchain could be the most consequential development in information technology since the Internet. Created to support the Bitcoin digital currency, the blockchain is actually something deeper: a novel solution to the age-old human problem of trust. Its potential is extraordinary. Yet, this approach may not promote trust at all without effective governance. Wholly divorced from legal enforcement, blockchain-based systems may be counterproductive or even dangerous. And they are less insulated from the law’s reach than it seems. The central question is not how to regulate blockchains but how blockchains regulate. They may supplement, complement, or substitute for legal enforcement. Excessive or premature application of rigid legal obligations will stymie innovation and forego opportunities to leverage technology to achieve public policy objectives. Blockchain developers and legal institutions can work together. Each must recognize the unique affordances of the other system.
Smart contracts, self-executing agreements based on blockchain technology, have the capacity to create trust in what we term no-trust contracting environments. We argue that using them in such environments is the path to unleash the full potential of smart contracts. Compared to the contract enforcement mechanisms characterized by traditional contract law or relational contracts, smart contracts can offer a superior solution for facilitating trade.
Several lawyers and economists have debated whether smart contracts might offer the prospect of cheaper, faster and better transactions. As we discuss below, contract law scholars caution that they neither replicate the relational context essential for the day-to-day practice of contracting nor offer a superior solution to problems addressed by traditional contract law, such as contract validity and legality. We clarify and systematize the current thinking on the legal nature and reliability of smart contracts, and address the concerns of contract law scholars. While doing that, we suggest a step forward in characterizing contracting environments, contract enforcement mechanisms and the trust relationship underlying contracts.
Current shareholder engagement systems face large classical inefficiencies. First, due to the large chains of intermediaries in the current securities models, transaction costs are high and shareholder votes and other information are not always correctly transmitted between shareholders and issuers. Recent cases including DNick Holding and T. Rowe Price show the ‘absurdness’ of the current systems. The Shareholder Rights Directive II addresses these problems and the Implementing Regulation already hints at modern technologies to increase the transparency and verifiability of shareholder engagement. Next, the current shareholder engagement system enables different opportunities for different types of shareholders, creating inequalities and hindering shareholder democracy. The solution to these substantial problems lies in a state-of-the-art technology: in this contribution we argue that blockchain technology can solve these current inefficiencies that shareholders and companies face. Using a permissioned blockchain, information can be stored in a verifiable and immutable way, with a consensus mechanism tailored to its purpose. The large amount of initiatives and prototypes of blockchain proxy voting and trading, including the legislative initiatives that were initiated in the past 2 years, show the merits of using this state-of-the-art technology. The Europe Union should incorporate this technology in its legislation, like the CSD regulation, for remaining technology-proof in this globalized market.
Balázs Bodó, Daniel J. Gervais, João Pedro Quintais
This article offers a normative analysis of key blockchain technology concepts from the perspective of copyright law. Some features of blockchain technologies—scarcity, trust, transparency, decentralized public records and smart contracts—seem to make this technology compatible with the fundamentals of copyright. Authors can publish works on blockchain creating a quasi-immutable record of initial ownership, and encode ‘smart’ contracts to license the use of works. Remuneration may happen on online distribution platforms where the smart contracts reside. In theory, such an automated setup allows for the private ordering of copyright. Blockchain technology, like Digital Rights Management 20 years ago, is thus presented as an opportunity to reduce market friction, and increase both licensing efficiency and the autonomy of creators. Yet, some of the old problems remain. The article examines the differences between new, smart-contract-based private ordering regime and the fundamental components of copyright law, such as exceptions and limitations, the doctrine of exhaustion, restrictions on formalities, the public domain and fair remuneration.
There is an immense need of a proof of delivery (PoD) of today's digital media and content, especially those that are subject to payment. Current PoD systems are mostly centralized and heavily dependent on a trusted third party (TTP) especially for payment. Such existing PoD systems often lack security, transparency, and visibility, and are not highly credible, as the TTP can be subject to failure, manipulation, corruption, compromise, and hacking. In this paper, we propose a decentralized PoD solution for PoD of digital assets. Our solution leverages key features of blockchain and Ethereum smart contracts to provide immutable and tamper-proof logs, accountability, and traceability. Ethereum smart contracts are used to orchestrate and govern all interactions and transactions including automatic payments in Ether cryptocurrency between customers, digital-content provider, and the file server hosting the digital content. All entities are incentivized to act honestly, and our solution has a mechanism to handle dispute if arisen among participants. The solution has an off-chain secure download phase involving the file server and customers. Moreover, our solution leverages the benefits of interplanetary file system to store the agreed upon terms and conditions between the smart contract actors. A security analysis of our proposed system has been provided. The full code of the smart contract has been publicly made available on Github.
Open access
Blockchain Technology Applications and Security
FinTech, Crowdfunding, Digital Finance
Advanced Steganography and Watermarking Techniques
Blockchain-based smart contracts are emerging as a disruptive force that may change the way financial statement audits are performed and delivered. With their potential ability to autonomously execute audit procedures on behalf of the auditor and disclose the results of these audit procedures, blockchain-based smart contracts have the potential to improve audit quality and meet the information demands of various vested parties for more timely and transparent audit reporting. This paper proposes the application of smart contracts to auditing as an enabler for improved audit data analytics and close to real-time audit reporting.
A smart contract is hard to patch for bugs once it is deployed, irrespective of the money it holds. A recent bug caused losses worth around $50 million of cryptocurrency. We present ZEUS-a framework to verify the correctness and validate the fairness of smart contracts. We consider correctness as adherence to safe programming practices, while fairness is adherence to agreed upon higher-level business logic. ZEUS leverages both abstract interpretation and symbolic model checking, along with the power of constrained horn clauses to quickly verify contracts for safety. We have built a prototype of ZEUS for Ethereum and Fabric blockchain platforms, and evaluated it with over 22.4K smart contracts. Our evaluation indicates that about 94.6% of contracts (containing cryptocurrency worth more than $0.5 billion) are vulnerable. ZEUS is sound with zero false negatives and has a low false positive rate, with an order of magnitude improvement in analysis time as compared to prior art.
The question of regulation in the domain of cryptocurrencies has been tackled in various ways, exhibiting therein a desire to strike a balance between fostering innovation and promoting oversight. This chapter examines the case of BitLicense, issued by the New York Department of Financial Services (DFS), with the aim of contextualizing the relative merits of regulatory and oversight initiatives in the domain of cryptocurrencies. This includes an examination of the impact and critiques regarding BitLicense since its promulgation, along with the use of perspectives from public value theory (PVT) to contextualize the value creation efforts of the DFS using BitLicense as a regulatory instrument. The findings of the chapter suggest that contrasting views exist on the value creation of cryptocurrency regulations, and this is reflected both in a PVT approach as well as the evolving praxis of virtual currency regulatory and oversight efforts.
Drawing on an empirical study of cryptocurrency white papers, this paper proposes an actor-based taxonomy of cryptocurrency blockchains. First, it describes the evolution of blockchain architecture with reference to the economic services that blockchains supply. Second, it discusses the socio-technical platform of blockchains as proposed in cryptocurrency white papers. Third, it analyses the socio-economic consequences of these technically diverse blockchain platforms, by proposing a taxonomy of their digital architectures in reference to two groups of actors that maintain blockchain infrastructure: transactioners and accountants. Defining cryptocurrency as data money, and locating cryptocurrency ownership as the possession of an exclusive right to move data privately in a public or private space, the paper describes a blockchain as a digital actor-network platform that makes it possible to define and distribute these data transfer rights.
Jethin Abraham, Daniel Higdon, John B. Nelson, Juan G. Ibarra
In this paper, we present a method for predicting changes in Bitcoin and Ethereum prices utilizing Twitter data and Google Trends data. Bitcoin and Ethereum, the two largest cryptocurrencies in terms of market capitalization represent over \$160 billion dollars in combined value. However, both Bitcoin and Ethereum have experienced significant price swings on both daily and long term valuations. Twitter is increasingly used as a news source influencing purchase decisions by informing users of the currency and its increasing popularity. As a result, quickly understanding the impact of tweets on price direction can provide a purchasing and selling advantage to a cryptocurrency user or a trader. By analyzing tweets, we found that tweet volume, rather than tweet sentiment (which is invariably overall positive regardless of price direction), is a predictor of price direction. By utilizing a linear model that takes as input tweets and Google Trends data, we were able to accurately predict the direction of price changes. By utilizing this model, a person is able to make better informed purchase and selling decisions related to Bitcoin and Ethereum.
Naoyuki Yoshino, Tim Schloesser, Farhad Taghizadeh–Hesary
To achieve the sustainable development goals (SDGs) as well as the Paris Agreement major investments in renewable energy (RE) production are necessary worldwide. In particular, decentralized, small-scale projects offer copious potential to create energy access as well as to contribute to an affordable, reliable and sustainable energy supply system. However, in developing countries such projects often face issues in finding funding. Direct private investment tools like the community-based hometown investment trust (HIT) fund address this issue and offer a way of financing for those projects. Technical developments in the sphere of distributed ledger technologies (DLTs) provide the opportunity to increase the fund's transparency and thus to improve its functioning. On that basis, this paper contributes to the literature in two ways: First, it delineates a concrete application of DLTs in the field of green financing, which offers the potential to increase social welfare. Second, the decision problem of investors is modeled, which illustrates through which channel the use of DLTs impacts the investors' behavior.
Blockchain is a form of distributed ledger technology (DLT) that has grown in prominence, although its full potential and possible downsides are not yet fully understood, especially with respect to Operations Management (OM). This manuscript contributes to filling in this gap. We identify three research themes in applying Blockchain technology to OM, illustrated through several applications to OM problems. Elsewhere, in a companion article, (Babich and Hilary (2018)), we provide a conceptual framework for the role of Blockchain and other DLT in OM, along with specific examples of research questions, and we demonstrate how research in economics can inform research in OM on Blockchain applications. Finally, we discuss possible future uses for the technology.
Abstract This article outlines the benefits and risks of the distributed ledger technology (DLT) for the clearing and settlement of exchange-traded and OTC securities, followed by a description of the technology’s potential role for central counterparties and central securities depositories. Although the industry and scholars are attempting to solve the technological and operational issues that DLT systems still face, outstanding legal risks are such that the financial industry is asking for more regulatory guidance and intervention. This article wants to contribute to the public policy debate by presenting potential regulatory barriers that may have to be removed for DLT to be fully adopted. In addition, it identifies areas requiring an update of the legal framework in order to address certain prudential and conduct risks that this technology could introduce.
David Rozas, Antonio Tenorio-Fornés, Silvia Díaz-Molina, Samer Hassan
Blockchain technologies have generated enthusiasm, yet their potential to enable new forms of governance remains largely unexplored. Two confronting standpoints dominate the emergent debate around blockchain-based governance: discourses characterized by the presence of techno-determinist and market-driven values, which tend to ignore the complexity of social organization; and critical accounts of such discourses which, while contributing to identifying limitations, consider the role of traditional centralized institutions as inherently necessary to enable democratic forms of governance. In this article, we draw on Ostrom’s principles for self-governance of communities to explore the transformative potential of blockchain beyond such standpoints. We approach blockchain through the identification and conceptualization of six affordances that this technology may provide to communities: tokenization, self-enforcement and formalization of rules, autonomous automatization, decentralization of power over the infrastructure, increasing transparency, and codification of trust. For each affordance, we carry out a detailed analysis situating each in the context of Ostrom’s principles, considering both the potentials of algorithmic governance and the importance of incorporating communities’ social practices into blockchain-based tools to foster forms of self-governance. The relationships found between these affordances and Ostrom’s principles allow us to provide a perspective focused on blockchain-based commons governance.
Ioannis Karamitsos, Maria Papadaki, Nedaa Baker Al Barghuthi
Blockchain is a fast-disruptive technology becoming a key instrument in share economy. In recent years, Blockchain has received considerable attention from many researchers and government institutions. This paper aims to present the Blockchain and smart contract for a specific domain which is real estate. A detailed design of smart contract is presented and then a use case for renting residential and business buildings is examined.
Mudassir Khan, Mohammad Mazhar Nezami, Rajesh Dey, Tanveer Ahmad
Initially introduced to support programming cryptocurrencies, blockchain technology has evolved quickly to be considered fundamental for secure, transparent, and decentralized systems in and across industries. This chapter attempts to illustrate how blockchain system rests on the cornerstones of distributed ledger technology, immutability, and consensus mechanisms and provides case studies in areas like healthcare, real estate, and urban infrastructure to illustrate how blockchain can be used to strengthen trust, enhance efficiency, and automate processes; it also goes on to address the challenges of security concerns and standardization. The role of artificial intelligence (AI) also strengthens the application of blockchain in the field, developing cybersecurity solutions for a smart governance system. Through insight into general-use scenarios and experimental work, this chapter defines a field vision over a variety of scholarly perceptions of blockchain. It also suggests governance, interoperability, and intelligent systems as significant elements for the scaling of blockchain solutions. The narrative ultimately reflects on the future convergence of blockchain, AI, and digital governance to pave the way for resilient and intelligent communities connected throughout sustainable digital landscapes.