Mathew Fukuzawa, Michael G. Kay, Brandon M. McConnell, Kristin Thoney-Barletta · 5 authors
Purpose - Demonstrate proof-of-concept for an expanded blockchain smart contract based small-scale contracting process that includes an internally managed arbitration service to manage disputes. Design/Methodology/Approach - Using Ethereum smart contracts, we model a small-scale general contracting scenario with disruptions. Execution is demonstrated with the Remix Integrated Development Environment (IDE). Findings - We show the feasibility of managing general contracting disputes with an internal arbitration service, completely encompassed within blockchain smart contracts. Originality/value - This research continues an original effort to model the small-scale general contracting scenario on a blockchain network. Research limitations/implications - Further work is required to expand the scope of dispute management and account for additional external factors. Also, full-scale decentralized application is not explored here. Practical implications - This process expands the scope of current practices and tools, such as Angi, in a decentralized manner with blockchain. Social Implications - Full-scale adoption at the small scale is likely difficult due to disbelief in technology, cost, and resistance to change.
With the continuous development of encryption technology, big data, artificial intelligence, and financial technology, digital currencies have emerged, which are based on blockchain technology to achieve peer-to-peer transactions and have high security and convenience. Unlike electronic and virtual currency, digital currency is a nonintermediary payment mechanism based on distributed ledger technology. The rise of digital currency has profoundly impacted the traditional currency system. On the one hand, digital currencies have improved transaction efficiency and payment convenience, reduced transaction costs, and promoted innovation in financial models. On the other hand, digital currencies also bring new risks and challenges, such as information leakage, fund security issues, and impact on traditional financial institutions. In addition, digital currencies may exacerbate global development imbalances, leading to differences in the efficiency of digital currency usage between developed and developing countries. This article further explores the relationship between digital currency and traditional currency, predicts their coexistence or substitution trends in the future, and emphasizes the importance of managing digital currency. Formulating relevant laws and policies to protect consumer assets and personal information security helps to promote the healthy development of digital currency and promote the stability and prosperity of the economy and society.
The study explores the implications of India's taxation policies on Virtual Digital Assets (VDAs), including crypto currencies and non-fungible tokens (NFTs). With the introduction of the Finance Act of 2022, which imposed a 30% tax on VDA profits and a 1% Tax Deducted at Source (TDS) on transactions, the digital asset landscape in India has undergone significant shifts. This research examines the economic and behavioural impact of these regulations on individual investors, start-ups, and the broader VDA ecosystem. The findings suggest that the flat tax rate and TDS have led to reduced market liquidity and deterred small-scale traders, highlighting challenges in compliance and record-keeping. However, these measures also formalize the VDA market, potentially attracting institutional investors by providing regulatory clarity. The study identifies gaps in the current policies and offers recommendations to balance regulation with market growth, ensuring a sustainable future for India's VDA sector.
The primary risks associated with game account trading include the exposure of personal information and the potential for account retrieval. In a system leveraging blockchain technology, specifically Ethereum combined with the InterPlanetary File System (IPFS), personal and game-related information is kept confidential. This system ensures that only the respective users have access to their personal data on the blockchain. Furthermore, upon the completion of a trade, the information associated with the account can be altered once, enhancing security. Additionally, the landscape of video game trading, particularly in China, is evolving rapidly. With the growth and development of the video game industry in the region, it has become increasingly challenging to trade game accounts. This complexity is largely due to the emergence of various policies and regulations that aim to safeguard user data and maintain the integrity of game ecosystems. The blockchain-based system provides a more secure and efficient way of handling these transactions, mitigating risks associated with traditional trading methods. By employing decentralized technologies, this innovative approach ensures greater privacy, security, and compliance with regulatory standards, thus revolutionizing the realm of game account trading.
Automated Market Makers (AMMs) are essential to decentralized finance, offering continuous liquidity and enabling intermediary-free trading on blockchains. However, participants in AMMs are vulnerable to Maximal Extractable Value (MEV) exploitation. Users face threats such as front-running, back-running, and sandwich attacks, while liquidity providers (LPs) incur the loss-versus-rebalancing (LVR). In this paper, we introduce RediSwap, a novel AMM designed to capture MEV at the application level and refund it fairly among users and liquidity providers. At its core, RediSwap features an MEV-redistribution mechanism that manages arbitrage opportunities within the AMM pool. We formalize the mechanism design problem and the desired game-theoretical properties. A central insight underpinning our mechanism is the interpretation of the maximal MEV value as the sum of LVR and individual user losses. We prove that our mechanism is incentive-compatible and Sybil-proof, and demonstrate that it is easy for arbitrageurs to participate. We empirically compared RediSwap with existing solutions by replaying historical AMM trades. Our results suggest that RediSwap can achieve better execution than UniswapX in 89% of trades and reduce LPs' loss to under 0.5% of the original LVR in most cases.
Ruchi Arora, Meera Kapoor, Nidhi Singh, Muhammad Zafar Yaqub
Abstract This study critically evaluates the extant research on green cryptocurrency (GC). It incorporates the systematic literature review (SLR) approach of research executed through the analysis and compilation of 54 relevant studies. The focus is on identifying and interpreting the thematic foci and existing gaps about GC to inform potential areas of future research. The SLR findings aggregated the research around key themes: interconnectedness, portfolio diversification, environmental impact, green blockchain, behavioral impact, and regulatory policy. Additionally, the study develops the research profile of the selected studies in terms of data analysis methodology, research findings, variables investigated, and critical knowledge gaps in the literature corpus. The study proffers an integrated framework and actionable inferences for supporting the merits of novel research and regulatory project applications in GC. It is crucial for understanding and advancing research in the GC domain, which currently has scant academic literature and efforts toward sustainable investment.
Although smart contracts have emerged as a key innovation for industries, siloed development and deployment of smart contracts pose numerous challenges to mass adoption and interoperability. This paper presents a comprehensive gap analysis of cur- rent standardisation efforts in smart contracts, focusing on common requirements, data formats, schema, and software templates. Through an examination of existing standards, best practices, and identified gaps, this paper proposes contributions to address these challenges. By advocating for cross-platform compatibility, scalability, and maintainability, it aims to advance the standardisation of smart contracts and foster their broader adoption in the industry.
Bitcoin adoption as a legal tender threatens a financial crisis because of the lack of regulatory frameworks and systems for exchanging Bitcoin into local currencies. This study analyzes monthly data from 2010 to 2022 using a structural vector autoregressive model, estimating Bitcoin’s pass-through into remittance, money multiplier, the US Dollar index, and gold price. The results show that Bitcoin prices decrease the money multiplier and gold prices in both the short and long run, while remittances moderately increase in the long run. The implication of these results suggests the potential for international business opportunities to stimulate the credit, savings, and investment monetary policy channel. The results are robust to alternative SVAR identification strategies.
The blockchain space is evolving rapidly, yet regulatory compliance and oversight remain significant challenges. This paper presents a comprehensive framework for embedding legal protocols into blockchain smart contracts, ensuring compliance with regulatory standards across diverse sectors such as finance, supply chain, and healthcare. By executing protocols mandated by legal authorities, blockchain applications can achieve new levels of conformity, transparency, and accountability. The concept introduces innovative routers for real-time monitoring, automated legal enforcement, and a hybrid legal-tech infrastructure that strengthens trust in decentralized financial ecosystems. These protocols are designed to function similarly to ERC standards, offering a standardized and scalable approach to regulatory compliance across multiple blockchain platforms. Furthermore, the importance of regulatory protocols for virtual machines (VMs) is emphasized, with particular focus on ensuring secure and compliant operation in decentralized environments. The proposed framework promotes proactive compliance, enhanced transparency, and improved trust in blockchain-based systems. This paper explores the technical and legal implications, potential challenges, benefits, and future adoption strategies for this revolutionary approach, aiming to align the blockchain ecosystem with the requirements of modern regulatory frameworks.
The vision of Web3 is to improve user control over data and assets, but one challenge that complicates this vision is the prevalence of non-transparent, scam-prone applications and vulnerable smart contracts that put Web3 users at risk.While code audits are one solution to this problem, the lack of smart contracts source code on many blockchain platforms, such as Sui, hinders the ease of auditing.A promising approach to this issue is the use of a decompiler to reverse-engineer smart contract bytecode.However, existing decompilers for Sui produce code that is difficult to understand and cannot be directly recompiled.To address this, we developed the SuiGPT Move AI Decompiler (MAD), a Large Language Model (LLM)-powered web application that decompiles smart contract bytecodes on Sui into logically correct, human-readable, and recompilable source code with prompt engineering.Our evaluation shows that MAD's output successfully passes original unit tests and achieves a 73.33% recompilation success rate on real-world smart contracts.Additionally, newer models tend to deliver improved performance, suggesting that MAD's approach will become increasingly effective as LLMs continue to advance.In a user study involving 12 developers, we found that MAD significantly reduced the auditing workload compared to using traditional decompilers.Participants found MAD's outputs comparable to the original source code, improving accessibility for understanding and auditing non-open-source smart contracts.Through qualitative interviews with these developers and Web3 projects, we further discussed the strengths and concerns of MAD.MAD has practical implications for blockchain smart contract transparency, auditing, and education.It empowers users to easily and independently review and audit non-open-source smart contracts, fostering accountability and decentralization.Moreover, MAD's methodology could potentially extend to other smart contract languages, like Solidity, further enhancing Web3 transparency.
The Indian music industry, like its global counterparts, faces significant challenges in protecting intellectual property IP and ensuring fair compensation for musicians. With the rise of digital platforms and increasing instances of piracy, musicians are finding it difficult to maintain control over their works. However, emerging technologies such as blockchain, artificial intelligence AI, and smart contracts offer innovative solutions to these challenges. This research paper explores the role of these technologies in enhancing IP protection and streamlining royalty distribution in India’s music industry. By focusing on the potential of blockchain for copyright management, AI for automated content monitoring, and smart contracts for transparent and efficient royalty distribution, this study highlights the opportunities and challenges associated with implementing these technologies in the Indian context.
This review paper explores the theoretical underpinnings and practical applications of blockchain technology within the banking sectors of African and U.S. financial institutions. It delves into key theoretical constructs such as Distributed Ledger Technology (DLT), smart contracts, and cryptographic security, examining their potential to revolutionize banking operations through enhanced efficiency, security, and transparency. The paper contrasts the applications and challenges faced by banks in Africa and the U.S., highlighting the unique opportunities and hurdles in each region. Regulatory environments, technological barriers, and market potential are critically analyzed to understand the landscape of blockchain adoption in banking. The review underscores the transformative potential of blockchain in banking while suggesting areas for future research aimed at overcoming challenges and harnessing emerging opportunities for innovation and growth in the sector.
By offering fresh approaches to solve long-standing issues like too much centralisation, not involving everyone, and not giving consumers enough autonomy, Web3 technologies are rapidly altering the way typical banking systems operate. One of the most fascinating fresh developments in the field is the growing Web3 membership. These empower consumers over their financial transactions by use of distributed platforms and blockchain technology. Unlike conventional membership models, Web3 payments let users to handle their own data, create explicit arrangements, and get services free from intermediaries. This article examines how Web3 subscriptions can transform the financial climate and open everyone's access. Subscription-based services let users freely access enhanced privacy, security, and control over their personal financial data. Web3 contracts remove obstacles to access so that those without bank accounts may utilize financial services, hence fostering financial inclusion. By shifting authority from centralized financial institutions to individuals, the decentralised framework of these models also allows consumers greater autonomy and independence. This paper investigates the advantages and drawbacks of Web3 accounts including legal concerns, user behavior problems, and growth capability. Following extensive research, we find methods to enhance Web3 membership systems so that they remain scalable, secure, and open for a broad spectrum of users. Finally, this research reveals how Web3 payments could alter the dynamics of financial models, therefore promoting a more open and user-centric attitude to financial services.
Open access
2 source records
FinTech, Crowdfunding, Digital Finance
Peer-to-Peer Network Technologies
Library Collection Development and Digital Resources
Smart contracts, self-executing agreements directly encoded in code, are fundamental to blockchain technology, especially in decentralized finance (DeFi) and Web3. However, the rise of Ponzi schemes in smart contracts poses significant risks, leading to substantial financial losses and eroding trust in blockchain systems. Existing detection methods, such as PonziGuard, depend on large amounts of labeled data and struggle to identify unseen Ponzi schemes, limiting their reliability and generalizability. In contrast, we introduce PonziSleuth, the first LLM-driven approach for detecting Ponzi smart contracts, which requires no labeled training data. PonziSleuth utilizes advanced language understanding capabilities of LLMs to analyze smart contract source code through a novel two-step zero-shot chain-of-thought prompting technique. Our extensive evaluation on benchmark datasets and real-world contracts demonstrates that PonziSleuth delivers comparable, and often superior, performance without the extensive data requirements, achieving a balanced detection accuracy of 96.06% with GPT-3.5-turbo, 93.91% with LLAMA3, and 94.27% with Mistral. In real-world detection, PonziSleuth successfully identified 15 new Ponzi schemes from 4,597 contracts verified by Etherscan in March 2024, with a false negative rate of 0% and a false positive rate of 0.29%. These results highlight PonziSleuth's capability to detect diverse and novel Ponzi schemes, marking a significant advancement in leveraging LLMs for enhancing blockchain security and mitigating financial scams.
How will Decentralized Finance transform financial services? Using New Institutional Economics and Dynamic Capabilities Theory, I analyse survey data from 109 experts using non-parametric methods. Experts span traditional finance, DeFi industry, and academia. Four insights emerge: adoption expectations rise from negligible to 43% expecting at least high adoption by 2034; experts expect convergence scenarios over disruption, with traditional finance embracing DeFi most likely; back-office transforms before customer-facing functions; strategic competencies eclipse DeFi-sector specific- and technical skills. This challenges technology-centric adoption models. DeFi represents emerging market entry requiring organizational transformation, not just technological implementation. SEC developments validate predictions. Financial institutions should prioritize developing strategic capabilities over mere technical training.
The development of smart contracts remains in its early stages, with significant differences in underlying programming languages and application platforms resulting in a lack of standardization. This lack of standardization increases the susceptibility to vulnerabilities and associated financial losses. To address security vulnerabilities in smart contracts on the Ethereum blockchain platform, this paper proposes a security audit method based on formal verification. The method integrates an input module, static analysis module, formal verification module, analog execution module, and report and recommendation module, which can accurately discover the security vulnerabilities and logical flaws of smart contracts through formal verification and other analysis techniques, thus realizing correctness detection. During the experiment, the method detects 8 types of common vulnerabilities in 148 smart contracts and marks 21 smart contracts with vulnerabilities. After manual review and analysis, it is found that 17 of these 21 marked smart contracts do have security vulnerabilities. The experimental results show that the proposed method can accurately detect security vulnerabilities and logic flaws in smart contracts through formal verification and other analysis techniques before smart contracts are deployed, thus significantly improving the security of smart contracts and reducing the economic losses that may be caused by code defects.
Decentralized Finance (DeFi) has revolutionized lending by replacing intermediaries with algorithm-driven liquidity pools. However, existing platforms like Aave and Compound rely on static interest rate curves and collateral requirements that struggle to adapt to rapid market changes, leading to inefficiencies in utilization and increased risks of liquidations. In this work, we propose a dynamic model of the lending market based on evolving demand and supply curves, alongside an adaptive interest rate controller that responds in real-time to shifting market conditions. Using a Recursive Least Squares algorithm, our controller tracks the external market and achieves stable utilization, while also controlling default and liquidation risk. We provide theoretical guarantees on the interest rate convergence and utilization stability of our algorithm. We establish bounds on the system's vulnerability to adversarial manipulation compared to static curves, while quantifying the trade-off between adaptivity and adversarial robustness. We propose two complementary approaches to mitigating adversarial manipulation: an algorithmic method that detects extreme demand and supply fluctuations and a market-based strategy that enhances elasticity, potentially via interest rate derivative markets. Our dynamic curve demand/supply model demonstrates a low best-fit error on Aave data, while our interest rate controller significantly outperforms static curve protocols in maintaining optimal utilization and minimizing liquidations.
The present study discusses how adopting cryptos affects financial inclusion in developing economies. Primary constructs like financial inclusion (FI), perceived economic empowerment (PEE), trust in financial institutions (TFI), user satisfaction (US), and cryptocurrency adoption (CA) were tested through Structural Equation Modeling (SEM). The results indicated that CA significantly and positively influenced FI, US, TFI, and PEE. These relationships extend to the interaction effects: US, TFI, and PEE, all positively related to FI. This is a reflection of cryptocurrencies as an opportunity to redress most of the afflictions characteristic of traditional finance systems and to promote financial inclusion and economic empowerment in developing countries. Future research should also investigate whether digital literacy and regulatory environments support cryptocurrency access.
Tanusree Sharma, Yujin Potter, Kornrapat Pongmala, Henry Wang · 7 authors
Decentralized Autonomous Organizations (DAOs) resemble early online communities, particularly those centered around open-source projects, and present a potential empirical framework for complex social-computing systems by encoding governance rules within “smart contracts” on the blockchain. A key function of a DAO is collective decision-making, typically carried out through a series of proposals where members vote on organizational events using governance tokens, signifying relative influence within the DAO. In just a few years, the deployment of DAOs surged with a total treasury of $24.5 billion and 11.1M governance token holders collectively managing decisions across over 13,000 DAOs as of 2024 . In this study, we examine the operational dynamics of 100 DAOs, like pleasrdao, lexdao, lootdao, optimism collective, uniswap, etc. With large-scale empirical analysis of a diverse set of DAO categories and smart contracts and by leveraging on-chain (e.g., voting results) and off-chain data, we examine factors such as voting power, participation, and DAO characteristics dictating the level of decentralization, thus, the efficiency of management structures. As such, our study highlights that increased grassroots participation correlates with higher decentralization in a DAO, and lower variance in voting power within a DAO correlates with a higher level of decentralization, as consistently measured by Gini metrics. These insights closely align with key topics in political science, such as the allocation of power in decision-making and the effects of various governance models. We conclude by discussing the implications for researchers, and practitioners, emphasizing how these factors can inform the design of democratic governance systems in emerging applications that require active engagement from stakeholders in decision-making.
Purpose : The current study examined the influence of neurotransmitters on cryptocurrency investment choices. Moreover, the research assessed the mediator risk tolerance (RT) and moderator investment experience on the connection between neurotransmitters and investment choices.Research Design/Methodology : The analysis of the data involved 504 responses from individuals in India’s Western and Northern regions who either invested in cryptocurrencies or had knowledge of such investments. The proposed theoretical model of cryptocurrency investment choices was examined in the study using “variance-based partial least square structural equation modeling†(PLS-SEM).Findings : The outcomes of this research specified that neurotransmitters play a substantial role in cryptocurrency investment choices, and they had a substantial impact on making investment choices. It was also noted that a significant moderator between neurotransmitters and Bitcoin investment decisions is RT. However, it was determined that investment experience had no moderating effect.Practical Implications : This study revealed that, in order to make better-informed investment decisions, businesses, governments, and investors should consider the impact of neurotransmitters.Value/Originality : The study was innovative since it is one of the first to examine how neurotransmitters, together with mediator RT and moderator investment experience, affected Bitcoin investment decisions. Additionally, the conceptual framework could be very helpful to cryptocurrency portfolio managers and investors in understanding how the brain functions during the decision-making process. They would then be better equipped to allocate their assets with knowledge and efficiency.
This review paper explores cryptocurrency adoption's strategic benefits and challenges for small and medium-sized enterprises (SMEs), emphasizing its potential to enhance financial inclusion and drive innovation. The paper overviews cryptocurrencies' history, key characteristics, and current adoption trends in various sectors. The paper examines the importance of financial inclusion and innovation for SMEs through a comprehensive literature review, highlighting how cryptocurrencies can reduce transaction costs, increase access to global markets, and improve financial transparency and security. The analysis also addresses the significant challenges SMEs face, such as regulatory and legal issues, technological and operational barriers, and market volatility. Practical recommendations for SMEs considering cryptocurrency adoption are provided, including steps for compliance, technological integration, risk management, and leveraging new business models. This paper aims to offer a balanced perspective, guiding SMEs in navigating the complexities of cryptocurrency adoption while maximizing its benefits.
Josip Zilic, Vincenzo De Maio, Shashikant Ilager, Ivona Brandić
Mobile devices offload latency-sensitive application tasks to edge servers to satisfy applications' Quality of Service (QoS) deadlines. Consequently, ensuring reliable offloading without QoS violations is challenging in distributed and unreliable edge environments. However, current edge offloading solutions are either centralized or do not adequately address challenges in distributed environments. We propose FRESCO, a fast and reliable edge offloading framework that utilizes a blockchain-based reputation system, which enhances the reliability of offloading in the distributed edge. The distributed reputation system tracks the historical performance of edge servers, while blockchain through a consensus mechanism ensures that sensitive reputation information is secured against tampering. However, blockchain consensus typically has high latency, and therefore we employ a Hybrid Smart Contract (HSC) that automatically computes and stores reputation securely on-chain (i.e., on the blockchain) while allowing fast offloading decisions off-chain (i.e., outside of blockchain). The offloading decision engine uses a reputation score to derive fast offloading decisions, which are based on Satisfiability Modulo Theory (SMT). The SMT models edge resource constraints, and QoS deadlines, and can formally guarantee a feasible solution that is valuable for latency-sensitive applications that require high reliability. With a combination of on-chain HSC reputation state management and an off-chain SMT decision engine, FRESCO offloads tasks to reliable servers without being hindered by blockchain consensus. We evaluate FRESCO against real availability traces and simulated applications. FRESCO reduces response time by up to 7.86 times and saves energy by up to 5.4% compared to all baselines while minimizing QoS violations to 0.4% and achieving an average decision time of 5.05 milliseconds.
Accountability refers to a relationship of responsibility, answerability, and enforceability between individuals and groups. In contrast to traditional institutions that rely on enforcement of accountability through traditional legal frameworks, blockchain systems rely on the “rule of code”, i.e. the operation, governance, and transactions on a blockchain are governed by pre-written, transparent, and immutable rules that are expressed in software code. By empirically examining the case of the Ethereum blockchain and the Lido “liquid” staking services protocol, this paper analyses the formalisation of accountability mechanisms between protocols to ensure that Lido’s proportionate share of staked ETH on the network does not pose a risk to the security and stability of Ethereum. The findings of this paper are threefold: (1) accountability on a blockchain is achieved through the implementation of checks and balances institutionalised via technological protocols ("on-chain accountability"); (2) accountability requires trade-offs, meaning that giving accountability to one type of stakeholders might actually reduce the accountability of the system for another category of stakeholder; and (3) end users of the blockchain are consumers of accountability, rather than influential participants in producing it. This research underscores the complex interplay of technical and governance considerations in ensuring accountability within blockchain systems, offering insights into the broader implications of on-chain accountability for stakeholders across blockchain ecosystems.