Blockchain Papers

Oleksandr Manoylenko, S.S. Kuznetsova, Anton O. Pysakovskyi

The article explores the conception of decentralized finance (DeFi) as one of the key innovations of the modern digital economy, which has the potential to fundamentally change traditional approaches to providing financial services. An analysis of the main characteristics of DeFi protocols, their functional capabilities, and differences from centralized financial institutions has been conducted. Particular attention is paid to the analysis of such advantages of DeFi as open access to financial products, transaction transparency, process automation based on smart contracts, and the reduction of dependence on centralized intermediaries. At the same time, key issues in the development of DeFi have been outlined, including high technological complexity, regulatory uncertainty, financial volatility of assets, and risks associated with the vulnerability of smart contracts. The article emphasizes the need to create tools for a comprehensive assessment of the investment potential of DeFi protocols, as traditional analysis methods, which are primarily based on profitability or liquidity indicators, do not fully reflect the specifics of decentralized systems. In response to this issue, the conception of a multifactor indicator DIAD (DeFi Investment Attractiveness Dashboard) has been proposed, which allows for the integration of the assessment of financial parameters (return, volatility, liquidity), institutional characteristics (level of governance decentralization), and behavioral variables (user activity) into a single model. The developed methodology enables objective cross-platform comparison of various DeFi protocols, which is crucial for making informed investment decisions in the high-risk environment of digital assets. The article forms the theoretical basis for further empirical research on the efficiency of decentralized platforms, the development of risk management strategies in the DeFi sector, as well as the advancement of regulatory initiatives aimed at ensuring the resilience of the new financial ecosystem in the Web3 environment. The obtained results are of practical significance for investors, developers of decentralized applications, and regulatory bodies working on the integration of innovative financial technologies into the global economy.

Ágnes Juhász

The study focuses on the examination of the most fundamental concept of civil law, especially the right in rem, namely the concept of things. The author seeks to answer the question of how new phenomena appearing because of technological development, such as digital assets, including various crypto assets like tokens, can be integrated into the system of classical civil law, whether they may be subject to property rights or the civil law rules applicable to the property. To answer this question, the author first explores the concept of things based on the old Hungarian private law literature and the provisions of the earlier and current Hungarian civil codes, presenting contemporary private legal opinions. Then, she deals with the legislative extension of the rules governing things and reviews which assets have been subject to a possible revision of the conceptual framework of the thing. The author pays particular attention to the examination of digital assets, defining and classifying tokens based on the MiCA regulation recently adopted by the European legislator. In the final part of the study, the author deals with the category of non-fungible tokens, highlighting the problems that are currently identifiable and clearly need to be solved in the future.

Botond Breszkovics

A nem helyettesíthető vagy másként nem felcserélhető tokenek (non-fungible token, NFT) attól függetlenül, hogy még egy évtizedes múlttal sem rendelkeznek, már számos jogsértés melegágyaként szolgáltak. A tanulmány célja egy összefoglaló áttekintést nyújtása az elmúlt évek iskolapéldájának tekinthető befejezett és folyamatban lévő NFT kötődésű jogivitákról, kiegészülve egy rövid, kapcsolódó jogelméleti háttér információ nyújtással. Ennek érdekében, jelen tanulmány vizsgálódása az angolszász és a kontinentális jogrendszerek szerzői jogának főbb elméleti és fejlődési mérföldköveinek áttekintésével veszi kezdetét. Ezt követi az NFT-k szerzői jogi vonatkozásainak alakulásának tárgyalása az EU-ban, az USA-ban és Magyarországon. Végül ismertetésre kerülnek a közelmúlt mérvadó NFT jogesetei, összegző gondolatokkal zárva.

István Ambrus, Kitti Mezei

Abstract Money laundering is one of the most important criminal offences today, perceived in the context of economic operation. Nevertheless, money laundering is a constantly changing phenomenon that is also influenced by the latest technological advancements. In this study, our aim is, after briefly outlining the phenomenon of money laundering, to review the new statutory definition(s) and those assessment criteria that may also be of significance for legal practice in this context from 2021 onwards in Hungary. Subsequently, we will describe the current challenges of cryptocurrencies regarding the new Hungarian and EU legislation on money laundering. The method we use is criminal law-dogmatic and retrospective analysis. The analysis concluded that the Hungarian legislator has significantly broadened the scope of money laundering, and a much wider spread of this offence is predicted for the future.

Gyöngyi Bugár, Márta Somogyvári

Az utóbbi évtized talán egyik legérdekesebb pénzügyi innovációja a bitcoin és más kriptovaluták megjelenése.Ez a fizetőeszköznek szánt befektetési forma ma már mindenki számára elérhető, akár az interneten, akár a Budapesten is megtalálható bitcoin ATM-eken keresztül.Azonban sem az egyszerű felhasználók, de még a pénzügyi szakemberek jó része sincs tisztában a bitcoint megalapozó ideológiával, e kriptovaluta működési mechanizmusával és a benne rejlő kockázatokkal.Célunk az, hogy bemutassuk azt az elméleti problémát (double spending

Attila Szigeti

Investigation of the security of the Ethereum Ropsten test network in connection with the Echosafe application used to record verbal contracts developed by Blocksafe Kft

Viktor Halász

The author provides an overview of how cryptocurrencies are used by criminals, and how seizing and storing can be managed in criminal investigations.

Alexandra Anna Lakatos

Focusing on international and Hungarian experiences, the author provides an overview of IT-related crimes and the Bitcoin-phenomenon.

Györgyi Nyikos, Robert Tałaga

Currently the preparation of the new 2014-2020 multiannual financial framework period is taking place in all areas - e.g. the sectorial legislation, such as the establishment of the new system of Cohesion Policy, is in progress. The rules are being formed in the spirit of a new approach; result orientation will become the main goal which requires a change of attitude in the operation of the institution system. Poland and Hungary are two cohesion countries, both of them using a significant amount of structural funds to finance public investments. Despite the common regulation at EU level the two countries are seemingly choosing different solutions in order to guarantee smoother implementation that will allow policy objectives and results to be achieved more effectively – Hungary is centralizing and Poland is rather decentralizing the system. What is behind this phenomenon? Which is the best way to strengthen the efficiency of the cohesion policy? Our paper will present the institutions systems and mechanism, administrative procedures working in the cohesion policy and compare the Polish and Hungarian systems. It will analyze the directions of changes under the new cohesion policy regulation with regard to the functioning institutions system and national specificities. At the end of our analysis we try to identify good practices and make general recommendations.

Izabella Barati-Stec

This paper reviews the waves of democratization and the development of the public administration and public finances in Hungary, with special attention municipalities caused by the changes in sub-national finance regulation since 2010. During the transition yeas, Hungary was very forward looking and the first among CEE countries to end central planning and to introduce market rules into the economy. Everybody expected the decentralization to be a success story. 25 years later, Hungary not only failed to meet the expectations, but also undergone though a situation in 2008 to start a massive recentralization process. This paper puts fiscal decentralization in Hungary in a historical context while critically investigating the findings of recent literatures on decentralization process in Hungary. The critical investigation of past experiences and reform steps of the current government suggest possible reform measures to solve the financial problems of Hungarian municipalities.

Izabella Barati-Stec

After 1990, Hungary took steps toward decentralizing public administration and decision-making power. Administrative decentralization, however, was not matched by the same level of fiscal decentralization, creating tension and disparities among Hungarian municipalities. The revenue-raising ability of local governments in Hungary—especially after the economic downturn in 2008—is very low. The debt service of municipalities is also considerably higher than before 2008, a situation that can be explained in part by the change in the value of Hungarian forint relative to the Euro and the Swiss franc, the currencies in which half of Hungarian local debt is denominated. This situation is sharpened by unhealthy municipal financing practices, such as financing operating expenses from investment revenues or from loans. The indebtedness of the municipal sector increased 12.6 times from 2001 to 2007, and in 2007 about 83 percent of municipal borrowing was not backed by immobile assets or any revenue stream. This paper examines the system of municipal finance in Hungary with special attention to the current changes in the regulation and finance of Hungarian municipalities and the change in central control over municipal finances in general after 2008 (in part precipitated by the failure of borrowing rules created during the transitional period to prevent the current crisis in municipal finance), and suggests possible reforms to solve the financing problems of Hungarian municipalities.

Krisztián Kis, Rita Szekeresné Köteles

Based on the results of our questionnaire survey, our study presents the major operational features of LEADER LAGs established in Hungary in the second half of 2007. Our national survey indicated that most of the partnerships established do not have experience in the implementation of community-based rural development programmes and there are no traditions and practices for development cooperation, which may cause problems as the success of programme implementation highly depends on the preparedness of local society, on the cooperation of local people. The survey indicates that the development of areas covered by LAGs is hindered by so-called soft factors characterizing human resources (rural people and communities). Therefore human resources are not only factors of the rural economy but areas for development as well. Having examined the tasks of LAGs,it can be established that they deem it to be their principal task to grant support funds.Inouropinion, performance of this task is obviously necessary but far from sufficient to fulfil their catalyst role expected in local developments. For this purpose, it is essential for action groups to play a proactive role in organizing and thereby increase the capacity of local communities, a prerequisite for implementing a LEADER programme. In accordance with the basic principle of subsidiarity, rural development should be implemented locally, managed by local communities, and decisions should be made at local levels in a decentralized manner. At the same time, the survey points out that LAGs operate under strong government influence and control, leading to the conclusion that the Hungarian practice of the LEADER programme is characterized by decentralization without subsidiarity. In the present structure, the activities of LAGs are predominantly financed from central resources.Administration is the primary goal of their financing, which restricts their effective and efficient operations, thereby the successful implementation of the LEADER programme. It is unquestionable that LAGs need to be centrally financed since their operation is fundamental for programme implementation, but this requires more than acting in their present role of distributing resources. In order for action groups to fulfil their real roles to boost local developments, they need to recognize their mission; and from the financing and regulatory side, they must be enabled to complete the tasks expected from them and their function.

Krisztián Kis, Koteles Rita Szekeresne, Kiss, Krisztian, Szekeresne, Koteles Rita

A tanulmányban kérdőíves felmérésünk eredményeire támaszkodva bemutatjuk a 2007-ben megalakult LEADER HACS-ok fontosabb működési jellemzőit. Országos felmérésünkből kiderül, hogy nincsen hagyománya, gyakorlata a fejlesztésekben való együttműködésnek, holott a helyi program végrehajtása nagymértékben múlik a helyi társadalom felkészültségén, az emberek és szervezetek együttműködésén. A HACS-ok által lefedett térségek fejlődését több vonatkozásban a humán erőforrások, a vidéki emberek és közösségeik (az ún. szoft tényezők) hiányosságai gátolják, következésképpen sürgető a humán erőforrások fejlesztése is. A HACS-ok feladatuknak a támogatási források odaítélését tartják, ami fontos, de korántsem elégséges ahhoz, hogy a tőlük elvárt, a helyi vidékfejlesztési stratégiák végrehajtásában betöltendő katalizátor szerepüket ellássák. Ehhez elengedhetetlen az akciócsoportok társadalomszervező szerepvállalása, a helyi közösségek cselekvőképessége érdekében. A szubszidiaritással összhangban a vidékfejlesztést a helyi közösségek által irányítottan szükséges eldönteni és megvalósítani. A felmérés szerint a HACS-ok erős kormányzati befolyás és kontroll mellett decentralizáltan, de a szubszidiaritás híján működnek. A jelenlegi struktúrában a HACS-ok – az ellátott feladatokkal kapcsolatban felmerülő működési kiadásainak – finanszírozása nemzeti és uniós forrásokból történik, az elszámolható kiadások 100%-ának mértékéig. Az elszámolás adminisztrációja jelentős terhet ró a HACS-okra. Ahhoz, hogy az akciócsoportok betölthessék valós, helyi fejlődést katalizáló szerepüket, fel kell ismerniük küldetésüket, szabályozási és finanszírozási oldalról pedig segíteni szükséges, hogy a tőlük elvárt feladatokat ellássák. ---------------------------- Based on the results of our questionnaire survey, our study presents the major operational features of LEADER LAGs established in Hungary in 2007. Our national survey revealed that there were no traditions or practices for development cooperation, while the successful local implementation of the programme depends to a great extent on the level of preparation of the local society and on the cooperation of local people and organisations. The development of areas covered by LAGs is hindered by insufficiencies in human resources, of rural people and communities (the so-called soft factors). This makes the development of human resources an urgent task. LAGs consider their principal task to be the securing of grant funds. This is obviously necessary, but far from sufficient to fulfil their role as a catalyst in the implementation of local rural development strategies. For this purpose, it is essential for action groups to play a proactive role in organizing and thereby increase the capacity of local communities. In accordance with the basic principle of subsidiarity, rural development should be implemented locally, managed by local communities, and decisions should be made at local levels. The survey points out that LAGs operate under strong government influence and control, in a decentralized manner but without subsidiarity. In the present structure, the activities of LAGs are predominantly financed from central (national and EU) resources, covering 100 per cent of the eligible costs. Cost accounting is a significant administrative burden for LAGs. In order for action groups to fulfil their real roles to boost local development, they need to recognize their mission; also, from the financing and regulatory side, they must be given support in completing the tasks expected from them.

M Kecman

Numerous changes that have happened and are still happening in Serbia are the reason why her social and political structure is decentralizing and has to have fiscal and financial relations between the political territorial units decentralize. The new system of financing local government, which began to be applied from 1st January 2007, balanced the position of towns and municipalities.

Kadeřábková Jaroslava, Marek Jetmar

Decentralization of decision-making on the availability of essential public goods for regional and local level raises questions regardless of ability to ensure or guarantee the supply by the small municipalities. It affects the delicate problem of fiscal decentralization and own limits of decentralization process. In this paper, we deal with problems concerning primarily the development of small municipalities as independent public corporations, their ability to play the self-government role and to ensure the availability of essential public goods and services. The main criteria for defining small rural communities are the population and the status of municipality in the settlement structure, which is a predetermined by range of services provided at territory of municipality (market services, public services) to its citizens and residents of surrounding villages. We deal with problems of financing small communities, their participation in the distribution of revenue from shared taxes, the availability of other resources. We monitor the factors that enter into models of reallocation of public resources. We base their findings mot only on information from literature, but also from terrain research, which not only confirmed some previously published facts, but allowed to reveal the factors that significantly affect the financial situation of small municipalities. This led to the determination of parameters, the key mechanism for setting the allocation of public resources. On the basis of the investigation, we analyze the parameters, the key mechanism for setting the allocation of public resources. In conclusion, the authors summarize the main issues and articulate the principles that should be respected in the formulation and adjustment of the budget determination.

Snezana Hristova

This paper examines the financial crisis in light of the local economic development and sets out some policy recommendations. Local economic development is a process in which the local authorities cooperate with the public sector, business community, and NGOs, in order to create more appropriate environment for economic development and for unemployment decreasing. The last months saw the world economy facing to the worst financial crisis in history, causing unprecedented drop in demand and sales and record‐breaking unemployment levels worldwide. No country can escape certain economic and social consequences from the global financial crisis. The main research question is the following: How does the gobal crisis affect local governments? The local governements are facing several problems such as: higher unemployment and social needs at the community level, pressure for increased spending, difficulties of investment financing, need of deferring maintenance. Then, the paper sets some policy recommendations adressed to the following aspect‐ what should and can local governments do? The crisis offers some chances for change in the context of strengthening the role of local governments.The central government will rely on local governments to bring policies rapidly to bear on the economy. This could and should intensify the intergovernmentaldialogue and it could also lead to strengthening fiscal autonomy of municipalities. Improving the competitiveness at the local level and developing a strong local economy can help the country cope with the effects of the global economic slowdown. Local government units should improve their competitiveness to attract more investments and to develop their local economy. Given that the responsibility of assisting the national government in mitigating the impact of the crisis through stimulation of the local economy are given to local governments, this paper aims to discuss issues related to enhancing local economic development and fiscal decentralization as a means of improving overall service delivery in the country, in the context of global economic and financial crisis. Local governments may also be succesful in the promoting productivity locally in order to enhance the country’s competitiveness in anticipation of a greater role in global trade during the recovery in the next few years. The special focus of this paper has been given to the case of local economic development in the Republic of Macedonia.

Péter Halmai, Viktória Vásáry, Halmai, Peter, Vasary, Viktoria

Is the Common Agricultural Policy unsustainable? Is agricultural spending a major distorting factor in the EU economy and an obstacle to the implementation of the Lisbon agenda? To answer these complex questions, detailed analysis is required along the following lines of thought: 1. Exploration of factors justifying Community level intervention. – Is the ’theory of decentralization’ applicable to budgetary issues and the common agricultural policy? Our hypothesis suggests that it is. 2. Assessing CAP as it currently exists, including its ability to generate public goods at the level of the Community (multifunctional elements which are indeed cross-border externalities) and its ability to create added value at the level of the Community. 3. Making an attempt to redefine the Community’s agricultural policy by identifying goals which can be achieved more effectively at the supranational level rather than by involving secondary levels of decision making. – Making an attempt to outline a Common Rural Policy, a new policy intended to promote the creation of public goods required by the society by means of targeted and decoupled economic policy measures. The concept of the new policy – a new policy requiring both national and Community funding – is in line with the requirements of sustainable development, i.e. sustainable agricultural activities such as sustainable land use, food and feed production, biofuels, forestry and fishing. Additionally, the new policy we outlined may also be an effective approach to meeting challenges arising from globalisation, trade liberalization, climate change and structural reform issues. ----------------------------------------- Fenntarthatatlan a Közös Agrárpolitika? Torzítják a mezőgazdasági kiadások az EU gazdaságá¬nak fejlődését, gátolják a Lisszaboni stratégia végrehajtását? Ezekre a bonyolult kérdésekre a követ¬kező pontok részletes elemzésével adhatjuk meg a választ: 1. A közösségi szintű beavatkozást igazoló tényezők feltárása, rendszerezése. – Alkalmazható a „decentralizációs elmélet” a költségvetési kérdések, illetve a közös agrárpolitika vonatkozásában? Hipotézisünk szerint: igen. 2. A KAP értékelése – figyelembe véve az EU-szintű közjavak (a multifunkcionális elemek va-lóban határokon átnyúló externalitások) és EU-szintű hozzáadott érték előállítására vonatkozó képességet. 3. Kísérlet az EU agrárpolitikájának átalakítására annak segítségével, hogy felmérjük, mely cél-kitűzések valósíthatóak meg eredményesebben szupranacionális szinten, és nem pedig másodla¬gos döntési szintek bevonásával. – Kísérlet a Közös Vidékpolitika körvonalazására, amely új poli¬tika célzott és szétválasztott szakpolitikai intézkedések segítségével járul hozzá a társadalom által megkívánt közjavak előállításához. Az új politika koncepciója – annak az új politikának a koncepciója, amely mind nemzeti mind Kö¬zösségi szintű finanszírozást is igényel – összhangban van a fenntartható fejlődés – azaz a fenntart¬ható mezőgazdasági tevékenységek: fenntartható földhasználat, élelmiszer- és takarmány-előál¬lítás, bioüzemanyag, erdészet és halászat – követelményeivel. Továbbá az általunk felvázolt új po¬litika megfelelően kezelheti a globalizációval, kereskedelem-liberalizációval, klímaváltozással és strukturális reformmal kapcsolatos kihívásokat.

Judit Kálmán

Observation of the first and second generation of literature on fiscal decentralization together with further branches of political economy, e.g. specifically on the political economy of intergovernmental grants and the widening literature on political business cycles leads to a puzzle: decentralization is a continuing policy trend however in reality there are downsides, institutional, political and other factors that do interfere with decision-making and can increase the chances for inefficient policy outcomes. Infrastructure investment finances at all levels of government are especially prone to election cycles and corruption. Driven from the above context the basic research question guiding my work is: whether local infrastructure policies in Hungary are really designed according to efficiency considerations? What politico-economic factors might affect central and local governments’ allocations on infrastructure investment? To complete this goal, a closer look at municipal capital investment financing in Hungary takes place. Related to the main research question several themes emerge and hypotheses are checked on the effects of the revenue base, local need and socioeconomic indicators on local investment strategies and financing constructions or grant allocations. Does grant financing mean a less careful financial planning? What is the importance of lobbying through different channels? I also search for - and in fact do find evidence of electoral cycle effects and partisan considerations (effect of similarities in political color of central and local governments) in intergovernmental grant distribution and in municipal investment activities. These issues to be researched call for a mix of quantitative and qualitative methods. Some of my hypothesis are tested on limited data from a 2004 survey of city mayors in Hungary. Hypotheses on cycles, determinants of investment outlays of local governments and grant recipiency are tested with linear and Probit panel regressions respectively on a panel dataset comprehensive for all Hungarian local government budgets from 1993-2003, a period bridging three election cycles, linked with some demographic,socioeconomic data and local election data. Findings can add to the discussion on reforming local government finance system overall, on the agenda in Hungary for quite a while, but perhaps also to the new literature on the political economy of failures, delays in socially beneficial reforms. What this dissertation certainly does contribute to is the fairly small pool of international empirical evidences available on political budget cycles, especially at the sub-national level and the emerging literature on the political economy of intergovernmental grants providing the case of one transition country that irrespective of the fact of by now being an EU member sometimes shows certain similarities to the developing ones.