Tema ovog rada su kriptovalute. Budući da većina ljudi nije pravodobno upoznata s ovom temom, ovaj rad prikazuje i opisuje kriptovalute te način na koji se upotrjebljuju u svakodnevnom životu. Kriptovalute (eng. cryptocurrency) digitalne su valute dizajnirane kao sredstvo razmjene. Poznate su po tome što su državne agencije i banke isključene iz procesa razmjene. Kriptovalute omogućuju jednostavnu, jeftinu i brzu transakciju na području cijeloga svijeta. Trenutno najisplativije kriptovalute su Bitcoin i Ethereum, a u radu je opisana njihova korisnost, prednosti i mane. Budući da se Bitcoinu predviđa uspješna budućnost i sve je prisutniji i prihvatljiviji na tržištu, u radu su navedeni primjeri iz Hrvatske koji to potvrđuju. Sve veći broj poduzetnika odlučuje se za uvođenje kriptovaluta. U primjerima je obuhvaćen širok spektar djelatnosti, od frizerskih usluga, preko raznih tvrtki koji se bave prodajom računalne opreme, ugostiteljskih usluga preko mogućnosti brzog i lakog podizana gotovine na kripto bankomatima pa sve do plaćanja komunalnih usluga, pa čak i humanitarno djelovanje. Mnogi smatraju da su kriptovalute samo sinonim za prijevare i pranje novca, no programeri tvrde da su kriptovalute samo jedna vrsta tehnologije, alat koji sam po sebi ne može biti ni dobar ni loš, ovisno o tome za što se koristi. Autor ovoga rada proveo je istraživanje o tome kako se može besplatno započeti trgovanje kriptovalutama te je anketom ispitao stavove ispitanika o implementaciji kriptovaluta u društvu.
In this article, we explore the formidable yet untapped capabilities of Blockchain technology and Bitcoin in order to alleviate poverty. We focus on the Republic of Moldova, which has been plagued by endemic corruption and persistently high poverty levels since her independence in 1991 following the collapse of the Soviet Union. The transformative power of Blockchain technology and Bitcoin are then evidenced through a dual analysis of tourism 2.0 (with a real-world case study) and e-governance, which can contribute to increased inward capital investment flows, and help fight off corruption practices. Finally, we conclude that these new technologies constitute a significant step in the right direction, in order to break away from twenty-five years of disappointing socio-economic development performance.
We document systematic differences in bitcoin prices across 11 different markets representing 26% of global bitcoin trade volume. These differences must -due to the identical nature of all bitcoin -result from characteristics of markets themselves. We examine differences across the markets and find that those which do not require customer identification for establishing an account are more likely to deviate from representative market prices than those which do. This implies that standard financial regulations, specifically know-your-customer regulations, can have a non-negligible impact on the bitcoin market.
This paper examines Bitcoin from a legal and regulatory perspective, answering several important questions. \n \nWe begin by explaining what Bitcoin is, and why it matters. We describe problems with Bitcoin as a method of implementing a cryptocurrency. This introduction to cryptocurrencies allows us eventually to ask the inevitable question: is it legal? What are the regulatory responses to the currency? Can it be regulated? \n \nWe make clear why virtual currencies are of interest, how self-regulation has failed, and what useful lessons can be learned. Finally, we produce useful and semi-permanent findings into the usefulness of virtual currencies in general, blockchains as a means of mining currency, and the profundity of Bitcoin as compared with the development of block chain technologies. We conclude that though Bitcoin may be the equivalent of Second Life a decade later, so blockchains may be the equivalent of Web 2.0 social networks, a truly transformative social technology.
Kriptovalute su digitalni novac utemeljen na kriptografiji i decentraliziranom sustavu. Postoje samo u elektroničkom obliku kao jedinstveni digitalni novčići ("tokeni"). Iza njih ne stoji autoritet države niti ih je moguće svojevoljno proizvesti. Rad se fokusira na značajkama, postavkama, razvoju i svim međuodnosima važnih ekonomskih faktora koji utječu na kriptovalute. U prvom poglavlju navedena su obilježja kriptovaluta. Drugo poglavlje daje primjere i govori o primjeni kriptovaluta u svakodnevnom životu. U trećem poglavlju je raspravljano o trenutnim i budućim regulacijama najmoćnijih zemalja svijeta (G20) , kao i njihovoj zajedničkoj suradnji u želji za jedinstvenim i standardiziranim pravilima, a sve u svrhu što kvalitetnijeg nadzora nad kriptovalutama kako bi se spriječile malverzacije i zaštitili potrošači. Četvrto poglavlje govori o inicijalnoj ponudi kovanica, a peto poglavlje je namijenjeno sigurnosti kriptovaluta. Cilj istraživanja je utvrditi koliko je studentska populacija upoznata i usmjerena prema novim oblicima digitalnog novca, koje značajke kriptovaluta smatraju pozitivnima, a koje negativnima i u kojoj su mjeri investirali ili su spremni investirati dio svojih ulaganja u kriptovalute i sl. Metode istraživanja korištene u radu su kompilacija na temelju proučavanja postojeće literature o temi rada, prikupljanje i analiza podataka vezanih uz kriptovalute, ponajprije podataka vezanih uz cijene i tržišnu kapitalizaciju, anketiranje studenata Ekonomskog fakulteta u Rijeci i metoda dedukcije putem koje su pokazane sve važne karakteristike i obilježja kriptovaluta. Na temelju provedene ankete u kojoj je sudjelovalo 90 studenata Ekonomskog fakulteta u Rijeci zaključak toga dijela istraživanja je da je mlada populacija dobro upoznata s kriptovalutama i njenim glavnim značajkama, ali i određenim nedostatkom informiranosti o tehnologiji (trećina studenata nije čula za pojam "blockchain") i nedovoljnoj odlučnosti oko investiranja i trgovanja u kriptovalute. Povrh toga, dokazan je i negativan utjecaj hakerskih napada i određenih kriminalnih radnji, kao i nestabilnost tržišne cijene na povjerenje studenata, ali i ukupne populacije vezane uz globalni financijski sustav u kriptovalute. Ishod istraživanja omogućio je da zaključimo kako su kriptovalute trenutno u ranoj fazi razvoja i nisu se dovoljno implementirale za široku primjenu u trgovini roba i usluga ili općenito kao sredstvo razmjene. Faktor koji je uključen u istraživanje kako bi opisao veličinu, odnosno obujam neke kriptovalute je tržišna kapitalizacija u dolarima. Temeljna ideja ovog rada je informirati čitatelja o pozitivnim i negativnim značajkama koje se se vežu uz kriptovalute. Na taj način čitatelji će biti bolje informirani i educirani o potencijalnom riziku ulaganja u kriptovalute, kao i većoj razini zaštite prilikom posjedovanja neke digitalne valute.
There are over 275 virtual currencies in existence today. One of these currencies is Bitcoin, the largest andmost recognised virtual currency in the world. With its exponential growth over recent years, Bitcoin isbringing a degree of permanence for, and dependability on virtual currencies that can no longer be ignored byregulators. While an increase in international regulatory activity over the past 12 months suggests that somegovernments understand this, Australian regulators appear reluctant to act. In addition to examining Bitcoin’soperational system in detail, this article examines the affect that Bitcoin is having on two key features of thefinancial system: (1) the money laundering and illicit finance supply system; and (2) the payment system. Bycomparing the effectiveness of the response measures enacted by Australian and international regulators inCanada, Singapore, the United States, and the United Kingdom, this article demonstrates that even thoughAustralia’s current payment system policy is capable of addressing the threats posed by virtual currencies, thecurrent money laundering and terrorist financing regulations fail to satisfy Australia’s international obligations,and stifle the legitimate use and development of virtual currencies in Australia.
Bitcoin is a peer-to-peer electronic payment system that operates as an independent currency. This paper is a philosophical investigation of the ontological constitution of Bitcoin. Using Slavoj Žižek’s ontological triad of the real, the symbolic and the imaginary, the paper distinguishes between three ideal typical theories of money: commodity theory, fiat theory, and credit theory. The constitution of Bitcoin is analysed by comparing the currency to each of these ideal types. It is argued that Bitcoin is commodity money without gold, fiat money without a state, and credit money without debt. In conclusion, it is suggested that Bitcoin poses an ideological challenge to conventional forms of money in so far as it not only provokes sedimented beliefs about money but also exposes the forms of exploitation, risk and even violence inherent in the existing system of state authorized credit money.
Abstract This paper is an analysis of the role reputation plays in the Deep Web using data from the Internet black-market site, The Silk Road. This encrypted online marketplace employed cryptocurrency and functioned over the Tor network. Utilizing a modeling technique, informed by trade auction theory, we investigate the effect of seller reputation. Analysis of the seller's reputation gives us insights into the factors that determine the prices of goods and services in this black marketplace. Data on cannabis listings is parsed from the Silk Road website and covers an 11-month time period, from November 2013 to October 2014. This data demonstrates that reputation acts as a sufficient self-enforcement mechanism to allow transactions. These findings exemplify the robustness of spontaneous order with respect to the Deep Web as an emergent marketplace.
Craig K. Elwell, Margaret Murphy, Michael V. Seitzinger
This report has three major sections. The first section answers some basic questions about Bitcoin and the operation of the Bitcoin network and its interaction with the current dollar-based monetary system. The second section summarizes likely reasons for and against widespread Bitcoin adoption. The third section discusses legal and regulatory matters that have been raised by Bitcoin and other digital currencies.
Peggy Valcke, Niels Vandezande, Nathan Van de Velde
The research looked at which third party payment providers (TPP’s) are covered by the PSD2 and AMLD4 directives, the consequences thereof, as well as to what extent such coverage goes; and sought to analyse the potential for the regulation of cryptocurrency in terms of combatting money laundering and terrorist financing. TPP’s gain possession of a significant amount of sensitive information, for instance by providing a gateway from which consumers log in to their bank accounts using their unique identifiers and credentials. As a result, these entities are drawing increasingly more attention from legislators and regulators.Under the framework of the PSD2, TPP’s will be subject to stringent regulatory standards similar to those placed on traditional payment service providers under the PSD. In the US, regulation of TPP’s must be assessed on a state-by-state basis. In Florida, for instance, they can be considered as money transmitters, thus putting them under that regulation, as well as the federal Bank Secrecy Act. In Asia, the number of TPP’s has grown significantly over the past years. In China, these actors are regulated by the People’s Bank of China, and are subjected to a number of requirements similar to those found in the EU, such as minimum capital requirements and anti-money laundering rules.Another notable development is that of alternative payment methods – a prime example here are cryptocurrencies such as bitcoin. The bitcoin ecosystem is decentralized, meaning that no single entity controls the system. Currently, there exists no convincing arguments to consider virtual currencies as regulated under the EU’s Payment Services Directive or the Second E-money Directive. While the PSD2 does introduce new terminology and significantly amended scope exemptions compared to the original Payment Services Directive, there is no wider inclusion of virtual currencies under its scope. A similar argument can be made for the recently adopted AMLD4, where virtual currencies have been omitted from its scope despite earlier signs that this development may be included. The researchers conclude their paper with several public and private sector recommendations.
Bitcoin is a decentralized crypto-currency, and an accompanying protocol, created in 2008. Bitcoin nodes continuously generate and propagate blocks---collections of newly approved transactions that are added to Bitcoin's ledger. Block creation requires nodes to invest computational resources, but also carries a reward in the form of bitcoins that are paid to the creator. While the protocol requires nodes to quickly distribute newly created blocks, strong nodes can in fact gain higher payoffs by withholding blocks they create and selectively postponing their publication. The existence of such selfish mining attacks was first reported by Eyal and Sirer, who have demonstrated a specific deviation from the standard protocol (a strategy that we name SM1). In this paper we extend the underlying model for selfish mining attacks, and provide an algorithm to find $ε$-optimal policies for attackers within the model, as well as tight upper bounds on the revenue of optimal policies. As a consequence, we are able to provide lower bounds on the computational power an attacker needs in order to benefit from selfish mining. We find that the profit threshold -- the minimal fraction of resources required for a profitable attack -- is strictly lower than the one induced by the SM1 scheme. Indeed, the policies given by our algorithm dominate SM1, by better regulating attack-withdrawals. Using our algorithm, we show that Eyal and Sirer's suggested countermeasure to selfish mining is slightly less effective than previously conjectured. Next, we gain insight into selfish mining in the presence of communication delays, and show that, under a model that accounts for delays, the profit threshold vanishes, and even small attackers have incentive to occasionally deviate from the protocol. We conclude with observations regarding the combined power of selfish mining and double spending attacks.
Proces globalizacji i rewolucji informacyjnej to zjawiska, które determinują rzeczywistość społeczno-gospodarczą współczesnego świata. Znalazły one praktyczne odzwierciedlenie w funkcjonowaniu systemów pieniężnych w globalnej gospodarce światowej, przede wszystkim w nowej postaci cyberwaluty, jaką jest bitcoin. Przedmiotem artykułu są przesłanki powstania, istota, zasady i sposób działania bitcoina. Jego cechy oraz coraz szerszy zakres funkcjonowania tej cyberwaluty mogą w przyszłości zagrażać bezpieczeństwu w wymiarze społecznym, gospodarczym i międzynarodowym.
Bitcoin is most radical innovation in monetary space for a very long time. It is an entirely private monetary system that runs itself and does not depend on trust in any central authority to honor its promises. Instead, it relies on trust in Bitcoin community or network that verifies transactions and maintains integrity of system. This system of distributed trust creates bitcoins and produces an automatic, tamper-proof bitcoin money supply process. (1) As such, it avoids dangers of discretionary monetary policy--namely, quantitative easing, manipulated interest rates, and need to rely on wise men or women to withstand political pressure or successfully forecast future. Indeed, under Bitcoin there is no monetary policy at all. There is just an automatic monetary rule dictated by Bitcoin protocol designed in 2009 by an anonymous programmer using alias Satoshi Nakamoto. Bitcoin has been widely hailed as a success and has won a substantial following. Unfortunately, underlying economics of Bitcoin mean that it is unsustainable and in all likelihood will be remembered as a failed experiment--at best a pointer to some superior successor. A first-pass intuition into Bitcoin can be obtained from a comparison with stone money in Milton Friedman's (1992) case study, Island of Stone Money. In this story, people of island of Yap in Micronesia used as money large round limestone disks transported from nearby island of Palau. These were too heavy to conveniently move around, so they were placed in prominent places. When ownership was to be transferred (e.g., as part of a dowry, inheritance, or ransom payment), current owner would publicly announce change in ownership but stone would typically remain where it was and islanders would maintain a collective memory of ownership history of stones. This collective memory ensured that there was no dispute over who owned which stones. Similarly, in Bitcoin, record of all transactions, blockchain, is also public knowledge and is regarded as die definitive record of who owns which bitcoins. Both stone money and Bitcoin share a critical feature that is highly unusual for a monetary system: both systems operate via a decentralized collective memory. On February 11, 2009, Nakamoto gave an explanation of thinking behind Bitcoin in an e-mail announcing its launch: root problem with conventional currency is all trust that is required to make it work. The central bank must be trusted not to debase currency, but history of fiat currencies is full of breaches of that trust.... With e-currency based on cryptographic proof, without die need to trust a third-party middleman, money can be secure and transactions complete. Cryptocurrencies, however, face problem of As Nakamoto notes, owner could try to re-spend an already spent coin by [digitally] signing it again to another owner. The usual solution is for a trusted company with a central database to check for double-spending, but that just gets back to trust model.... Bitcoin's solution is to use a peer-to-peer network to check for double-spending. Consequently, the result is a distributed system with no single point of failure. (2) Kevin Dowd is Professor of Finance and Economics at Durham University in United Kingdom and a partner at Cobden Partners. Martin Hutchinson is a journalist and author of Bear's Lair column (www.tbwns.com/category/the-bears-lair). The authors thank Ferdinando Ametrano, Gavin Andresen, Raadhiyah Anees, Steve Baker MP, Roger Brown, Dave Campbell, Akin Fernandez, Dominic Frisby, Jim Harper, Doug Jackson, Gordon Kerr, Jim Rapp, Eric Samieski, Lawrence H. White and Basil Zafiriou for much helpful feedback. We note that several of our readers have expressed serious reservations about our analysis and conclusions. Any remaining mistakes are authors' own. …
In dit artikel worden de mogelijke gevolgen belicht van de introductie van nieuwe en bestaande toepassingen van Bitcoin-technologie. De transnationale, decentrale en gedistribueerde peer-to-peer-structuur van de Bitcoin-technologie en van nieuwe toepassingen hiervan, hebben de potentie om bestaande sociale relaties en instituties te ontregelen. Het krachtenveld waarin maatschappelijke actoren staan kan hierdoor uit balans worden gebracht. De meest radicale van deze nieuwe technologieën is Ethereum. Met name het concept van de Digital Autonomous Organisation (DOA) heeft mogelijkerwijs verregaande consequenties. Ethereum is een ‘contract validating and enforcing system’, een gedistribueerd systeem dat een platform biedt voor autonome computerprogramma’s die in staat zijn om zelfstandig overeenkomsten met rechtspersonen en andere DOA’s aan te gaan en te ontbinden. Ik richt mij op de mogelijkheden van deze toepassingen als nieuwe platformen voor International Financial (Cyber) Crime.
Anti-Money Laundering is a set of rules and guidelines designed and agreed among countries to use as standard policies and framework in establishing their domestic laws on prevention and suppression of money laundering activities. The expansion of the financial sector and businesses brings about the continuous development of innovative and new financial instruments to facilitate the businesses. In parallel with this development, criminals also take advantages of the unfamiliarity to the newly developed innovation and create new money laundering methods. In this circumstance, and whilst the financial sector is a foundation of the national economic, the government and relevant state authorities have to monitor closely and supervise such new innovations.Among other innovations, virtual currency is created to facilitate financial transactions. It was found that virtual currency is the new financial innovation and also the system that used to connect with the customers through the online network via the internet. The key points of this currency are the description of it which are anonymous account and the system used in the transaction which is the peer-to-peer or blockchain connection system. These features are different from the standard financial instruments such as fiat currencies, financial institution, bank and non-bank business.The virtual currency is considerably new in Thailand. To date, the laws have not been developed to effectively govern the transactions using the said virtual currency. Exchangers, administrators, and users of the virtual currency are not within the scope of governance of the Anti-Money Laundering Act; nor are they subject to any other regulations. That is to say, the Anti-Money Laundering Act, including rules, regulations and guidelines established thereunder, only regulates performances of financial institutions and some other businesses as specifically determined. In other words, obligations and requirements under the Anti-Money Laundering laws do not apply to the virtual currency transactions and/or the involving parties. Thus, there are certain loopholes for some criminals to use the virtual currency instead of money in various financial transactions to avoid detection by the state authorities. Lacking of government supervision in this part leads to a new risk of money laundering through the virtual currency. This thesis studies the Anti-Money Laundering processes in the United States in comparison with those in Thailand, specifically focussing on the issues of money laundering using a kind of virtual currency: Bitcoin. Bitcoin is the most prevalent kind of virtual currency and is addressed widely and extensively in US laws, regulations and court judgments. Those laws can be useful guidelines for Thailand to develop its appropriate solutions for the problem of money laundering through the virtual currency. The key preventive measures under the Anti-Money Laundering Act are customers profile verification and transactions monitoring and recording. These measures are the essential procedures to control and monitor transactions to reduce the risk of money laundering. Also, it can also examine the suspicious transactions or suspect profiles of each customer. These methods could apply to the virtual currency and their relating business for supervision and manage the risk of money laundering as same as the other financial business under the Anti-Money Laundering law and regulation.
This paper explores the legal character of the Bitcoin and other emerging "virtual currencies," and the legal and policy implications of Bitcoin trading. It observes that these "cryptocurrencies" exhibit different legal characteristics depending on the context in which they are examinedwhether transactional law, tax law, or criminal law, for example. The paper argues that the appropriate legal analogue for classifying Bitcoins should be investment and commercial notes, since this characterisation would lead to the application of an appropriate and effective body of transactional and regulatory law to Bitcoins.
This paper analyzes Bitcoin and associated mining pools. Participants may decide to join a mining pool as an income smoothing device. Such participants are risk averse whereas other Bitcoin participants are risk taking.
Bitcoins and their use are a very actual issue, especially with high popularity and high cost of Bitcoins. Number of Bitcoin’s transactions increasing day to day. But many individuals and business owners do not understand what is Bitcoin, how it works and how could it be used in business. This article discusses the nature of Bitcoin, a decentralized, anonymous and largely unregulated virtual currency, its legal status and use in business. The article includes examination of both advantages and disadvantages of Bitcoin and international regulation of legal status and taxation of this currency.
Nicolas T. Courtois, Pinar Emirdag, Zhouyixing Wang
In this paper we study the question of centralisation in bitcoin digital currency. In theory bitcoin has been designed to be a totally decentralized distributed system. Satoshi Nakamoto has very clearly postulated that each node should be collecting recent transactions and trying to create new blocks (Satoshi08). In bitcoin transactions are aggregated in block in order to authenticate them and form an official ledger and history of bitcoin transactions. In practice as soon as expensive ASIC bitcoin miners have replaced general-purpose hardware, production of bitcoins and the validation of transactions has concentrated in the hands of a smaller group of people. Then at some moment in early 2012 an important decision was taken: the Stratum protocol was designed (Palatinus12) which took a deliberate decision to move the power of selecting which transactions are included in blocks from miners to pool managers. The growing difficulty of mining and large standard deviation in this process (Rosenfeld13; CourtoisBahack14) made that majority of miners naturally shifted to pooled mining. At this moment bitcoin ceased being a decentralized democratic system. In this paper we survey the question of a 51% attacks and show that there is a large variety of plausible attack scenarios. In particular we study one particularly subversive attack scenario which depends on non-trivial internal details of the bitcoin hashing process. How does it compare with the current mining practices? We have study the Stratum protocol in four popular real-life mining configurations. Our analysis shows that pools could very easily cheat the majority of people. However the most subversive versions of the attack are NOT facilitated and could potentially be detected.
Six assertions concerning the status of Bitcoin are formulated and defended: (i) Bitcoin is not and will not become a currency-like informational commodity, (ii) currency-like informational commodities that aren’t currencies must be frauds, (ii) specific BTC amounts may become monetized and thus may be turned into financial assets, (iii) currently no BTC amounts are monetized in any currency area and therefore none are financial assets, (iv) by means of burocratic steps only some BTC volumes can be turned in to an informational currency within a given currency area, modified client software is not required for that step, (v) if a specific amount of BTC qualifies as currency, it also qualifies as money, (vi) moneyness of Bitcoin, or rather of a specific occurrence of an amount of BTC, should be questioned only after one has agreed positively on its status as a financial asset, and negatively on its status as an amount of currency. Factions in the Bitcoin promoting movement are viewed from a perspective of organizational multi-threading. Different factions of the Bitcoin movement may wish to see status issues about Bitcoin settled in different ways. Overall consistency in these matters should not be expected from the union of factions in the Bitcoin movement.