Blockchain Papers

Greg N. Gregoriou, Lam Pak Nian

This article is a review of the <i>Handbook of Digital Currency: Bitcoin, Innovation, Financial Instruments, and Big Data</i>, edited by David L.K. Chuen and published by Academic Press. <b>TOPICS:</b>Currency, big data/machine learning

Joseph Bonneau, Andrew Miller, Jeremy Clark, Arvind Narayanan · 6 authors

Bit coin has emerged as the most successful cryptographic currency in history. Within two years of its quiet launch in 2009, Bit coin grew to comprise billions of dollars of economic value despite only cursory analysis of the system's design. Since then a growing literature has identified hidden-but-important properties of the system, discovered attacks, proposed promising alternatives, and singled out difficult future challenges. Meanwhile a large and vibrant open-source community has proposed and deployed numerous modifications and extensions. We provide the first systematic exposition Bit coin and the many related crypto currencies or 'altcoins.' Drawing from a scattered body of knowledge, we identify three key components of Bit coin's design that can be decoupled. This enables a more insightful analysis of Bit coin's properties and future stability. We map the design space for numerous proposed modifications, providing comparative analyses for alternative consensus mechanisms, currency allocation mechanisms, computational puzzles, and key management tools. We survey anonymity issues in Bit coin and provide an evaluation framework for analyzing a variety of privacy-enhancing proposals. Finally we provide new insights on what we term disinter mediation protocols, which absolve the need for trusted intermediaries in an interesting set of applications. We identify three general disinter mediation strategies and provide a detailed comparison.

Thomas Kim

To examine whether the recent price patterns and transaction costs of Bitcoin represent a general characteristic of decentralized virtual currencies, we analyze virtual currencies in online games that have been voluntarily managed by individuals since 1990s. We find that matured game currencies have price stability similar to that of small size equities or gold, and their transaction costs are sometimes lower than real currencies. Assuming that virtual currencies with a longer history can provide an estimate for Bitcoin's prospects, we project that Bitcoin will be less influenced by speculative trades and become a low cost alternative to real currencies.

Simon Trimborn

In dieser Thesis wird ein Marktindex konstruiert, wobei neu entwickelte Methoden für solch eine Aufgabe verwendet werden. Die Entscheidung über die Anzahl der Indexteilnehmer wird mithilfe des AIC und BIC Kriteriums getroffen und die Liquiditätsregel wird auf Grundlage der BIS Umfrage ermittelt. Dieser neu entwickelte Index, CRIX, wird dann benutzt, um den Kryptowährungsmarkt gegen Bitcoins und andere Märkte zu vergleichen. Es wurde herausgefunden, dass dieser Markt wesentlich risikoreicher ist als andere Märkte. Es wird außerdem ein Minimum Varianz CRIX und ein optimales Vorhersagemodel für den Index entwickelt, wobei Daten aus sozialen Netzwerken verwendet werden.

Béla Gipp, Norman Meuschke, André Gernandt

Trusted timestamping is a process for proving that certain information existed at a given point in time. This paper presents a trusted timestamping concept and its implementation in form of a web-based service that uses the decentralized Bitcoin block chain to store anonymous, tamper-proof timestamps for digital content. The service allows users to hash files, such as text, photos or videos, and store the created hashes in the Bitcoin block chain. Users can then retrieve and verify the timestamps that have been committed to the block chain. The non-commercial service enables anyone, e.g., researchers, authors, journalists, students, or artists, to prove that they were in possession of certain information at a given point in time. Common use cases include proving that a contract has been signed, a photo taken, a video recorded, or a task completed prior to a certain date. All procedures maintain complete privacy of the user's data.

Morten Brandvold, Péter Molnár, Kristian Vagstad, Ole Christian Andreas Valstad

No abstract is available for this record.

Ferdinando M. Ametrano

Bitcoin extreme deflationary price instability has hampered its usability, making it impractical for spot transactions and unserviceable for deferred payments. Ametrano (2014) has proposed as Hayek Money a cryptocurrency price stability paradigm of elastic non-discretionary monetary policy. An implementation using a dual asset ledger for stable coins and seigniorage shares is presented here. A DeCentralized Reserve Bank (as Decentralized Autonomous Organization) is introduced as active market agent using bitcoin as reserve asset to preserve price parity. The socially inefficient over-investment of seigniorage revenues in transaction verification can be avoided using proof-of-payment.This schema frees coins from any speculative value, thus favoring money velocity and increasing the number of transactions. Seigniorage shares are effectively to be considered as a participation in a distributed central bank: as such the owners are entitled to seigniorage revenues in exchange for being subjected to the losses associated to coin price stability defense, obliged to validation task duties, and in charge of price index observation.

K. Down, Martin Hutchinson

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. …

Zoran Čekerevac, Zdeněk Dvořák, Ludmila Prigoda, Petar Čekerevac

Bitcoin, digital money got into focus after the Mt Gox crash. It uses P2P interaction where an owner transfers the electronic coin to the next owner signing and adding a hash of the previous transaction and the public key of the next owner. Payment verification is accomplished by notifying the entire network about the transaction. This prevents double-spending and generation of non-existent money. Among the users, there is uncertainty about the safety on the theft and fraud. Among the authorities, there are dilemmas about present and future risks related to the Bitcoin implementation. The article deals with the benefits and risks of Bitcoin use.

Jeremy Eng‐Tuck Cheah, John Fry

No abstract is available for this record.

Davide Carboni

The ability to assess the reputation of a member in a web community is a need addressed in many different ways according to the many different stages in which the nature of communities has evolved over time. In the case of reputation of goods/services suppliers, the solutions available to prevent the feedback abuse are generally reliable but centralized under the control of few big Internet companies. In this paper we show how a decentralized and distributed feedback management system can be built on top of the Bitcoin blockchain

Michael Fleder, Michael S. Kester, Sudeep Pillai

Bitcoins have recently become an increasingly popular cryptocurrency through which users trade electronically and more anonymously than via traditional electronic transfers. Bitcoin's design keeps all transactions in a public ledger. The sender and receiver for each transaction are identified only by cryptographic public-key ids. This leads to a common misconception that it inherently provides anonymous use. While Bitcoin's presumed anonymity offers new avenues for commerce, several recent studies raise user-privacy concerns. We explore the level of anonymity in the Bitcoin system. Our approach is two-fold: (i) We annotate the public transaction graph by linking bitcoin public keys to "real" people - either definitively or statistically. (ii) We run the annotated graph through our graph-analysis framework to find and summarize activity of both known and unknown users.

정승영

No abstract is available for this record.

Paul Vigna, Michael J. Casey

Bitcoin became a buzzword overnight. A cyber-enigma with an enthusiastic following, it pops up in headlines and fuels endless media debate. You can apparently use it to buy anything from coffee to cars, yet few people seem to truly understand what it is. This raises the question: Why should anyone care about bitcoin? In The Age of Cryptocurrency, Wall Street journalists Paul Vigna and Michael J. Casey deliver the definitive answer to this question. Cybermoney is poised to launch a revolution, one that could reinvent traditional financial and social structures whilebringing the world's billions of unbanked individuals into a new global economy. Cryptocurrencyholds the promise of a financial system without a middleman, one owned by the people who use it and one safeguarded from the devastation of a 2008-type crash. But bitcoin, the most famous of the cybermonies,carries a reputation for instability, wild fluctuation, and illicit business; some fear it has the power to eliminate jobs and to upend the concept of a nation-state. It implies, above all, monumental and wide-reaching changefor better and for worse. But it is here to stay, and you ignore it at your peril. Vigna and Casey demystify cryptocurrencyits origins, its function, and what you need to know to navigatea cyber-economy. The digital currency world will look very different from the paper currency world; The Age of Cryptocurrency will teach you how to be ready.

Anna Piotrowska

The appearance of bitcoin is the beginning of a new era in which advanced technological capabili- ties have changed the perspective on the financial system's functioning rules and have expanded the understanding of the category of money. Bitcoin is used in commercial transactions, transfers and as an investment asset. The establishment of bitcoin is a part of the movement away from cash transactions and the general acceptance of non-material form of money observed around the world. The aim of the study is to analyse the bitcoin cryptocurrency in the scope of the fulfilment of the definition criteria and functions of money formulated in an economic theory, and to present the current legal situation in selected countries relating with its functioning.

Kariappa Bheemaiah

No abstract is available for this record.

Weihong Wang, Peng Li

Bitcoin is a virtual currency based on the P2P network. Because of decentralization, anonymity, stability and other advantages, Bitcoin develops rapidly. In order to cope with increasingly wide application fields of bitcoin, this research designs bitcoin's payment based on the IC card, which improves its safety and convenience. According to Bitcoin's unique utilization, we've designed and achieved the documental structure of Bitcoin IC card and mutual authentication between PSAM card and IC card. With the combination of IC card private key and user's private key leading to account's private key, it will be safer to private key. Besides using merge-avoidance algorithm when trading improves the security of the account.

Maria Letizia Perugini

Italian Abstract: Il tema di questo articolo richiama volutamente la definizione di analisi sequenziale propria delle scienze statistiche, nel cui ambito si procede formando un campione rappresentativo senza determinarne a priori l’ampiezza o la numerosità, che dipenderanno dai risultati ottenuti col progredire dell’osservazione o dell’esperimento. La ragione di questa scelta dipende dalla natura stessa del tema esaminato: si tratta di una materia nuova, in continua metamorfosi degli effetti, al punto da rendere particolarmente difficoltosa la determinazione astratta del campione di studio. Le ragioni storiche ed economiche che, nel tempo, hanno portato alla programmazione del protocollo Bitcoin conoscono oggi un'interessante fase evolutiva negli algoritmi di criptazione per l'identificazione di dati e il trasferimento di diritti, un sistema che presenta risvolti giuridici degni di nota. English Abstract: The theme of this paper is, on purpose, recalling the definition of sequential analysis typical of Statistics where the analysis goes on forming a representative sample with no predetermination of its magnitude or numerical amount, which will depend on the result gained as the observation or the experiment are going by. The reason for this choice is depending on the very nature of the topic we aim to analyse: a new subject matter, which effect are keeping on changing, thus making quite difficult the sample abstract determination. The historical reasons that, over time, have led to the Bitcoin protocol development are nowadays having an interesting implement in the encrypting algorithm for data identification and goods transferring, a system with remarkable legal effects.

Evan Francis

No abstract is available for this record.

Sevil Guler

Virtual currencies and mobile banking are technology advancements that are receiving increased attention in the global community because of their accessibility, convenience and speed. However, this popularity comes with growing security concerns, like increasing frequency of identity theft, leading to bigger problems which put user anonymity at risk. One possible solution for these problems is using cryptography to enhance security of Bitcoin or other decentralised digital currency systems and to decrease frequency of attacks on either communication channels or system storage. This report outlines various methods and solutions targeting these issues and aims to understand their effectiveness. It also describes Secure Bitcoin Wallet, standard Bitcoin transactions client, enhanced with various security features and services.

Sharan Bathija

No abstract is available for this record.

Lam Pak Nian, David Lee Kuo Chuen

No abstract is available for this record.

Larissa Lee

Bitcoin is the first and most successful digital currency in the world. It polarizes the news almost daily, with either glowing reviews of the many benefits of an alternative and international currency, or doomsday predictions of anarchy, deflation, and another tulip bubble.\nThis article focuses on the truly innovative aspect of Bitcoin - and that which has gone mostly unnoticed since its inception - the technological platform used to transfer Bitcoin from one party to another. This technology is called the Blockchain. The Blockchain eschews a bank or other intermediary and allows parties to transfer funds directly to one another, using a peer-to-peer system. This disruptive technology has done for money transfers what email did for sending mail - by removing the need for a trusted third party just as email removed the need for using the post office to send mail.\nIf this technology can be used for peer-to-peer money transfers, why not extend the technology to accomplish other forms of transfers? Imagine selling a house or buying a car peer-to-peer. What about using the Blockchain technology to buy and sell stocks? Stocks exchanged completely peer-to-peer could resolve many of the issues facing the stock market today, including high frequency trading and short sales. This article develops a peer-to-peer stock market system, the legal implications of such a system, and how this system will fit in with current legislation and regulation.

Sören Adamsson, Muhammad Hammad Nadeem Tahir

This study analyses the growing area of research that explores the evolution of technology from social and cognition perspective – and how the design and various implementation of technology are being shaped by the factors related to social-constructivism and beliefs systems of individuals. The newly developed technological phenomena of Cryptocurrency – the digital currency for all, provides us with an excellent case to study. We apply social and cognitive processes to understand technology trajectories across the life cycle of cryptocurrency. We thus deepen our understanding by analyzing why and what causes the various technological trajectories in the era of ferment and concluding our research by deriving various technological 'themes'. – that might evolve as the phenomena of cryptocurrency while moving towards the era of dominant design.