Surenthran David, S. Aravinth, Chris Sherin D, Mohamed Issath S · 6 authors
The banking sector is disrupted by the development of Decentralized Finance (DeFi) based on blockchain technology. DeFi provides permissionless, trustless, and programmable services. This article looks at how DeFi is changing the traditional banking sector from a blockchain viewpoint. DeFi both threatens and offers opportunities to conventional banks by eliminating middlemen, lowering costs of transactions, improving financial inclusion, and facilitating real-time asset settlement. For this research, we use a unique approach combining financial network modeling and smart contract analysis to measure the efficiency, security, and scalability of DeFi protocols compared to centralized banking systems. While the findings suggest that DeFi could be more accessible, efficient, and open than existing financial infrastructures, they also show that there are real problems with regulation, security, and systemic risk. This work adds to our knowledge of the changing dynamics between traditional finance and DeFi by providing a blockchain-based model for the potential interplay between these two paradigms in the future.
This paper investigates how the evolution of interbank payments towards central bank settlement, and thus central bank money as a settlement asset, has affected the dynamics of bank crises.We take the cluster of bank defaults in the United States in 2023 as a starting example and show how, alongside fractional reserves and fast digital communication, centralized settlement in central bank money played a critical role in triggering swift bank failures.We argue that technical centralization has amplified banks' fragility in the development of confidence crises, making bank runs easier and expanding the role of central banks to a point where conflict of interest becomes nearly inevitable.While previous literature has emphasized the effects of fast news spread and online banking, the role of settlement technology in recent bank runs has been largely overlooked.Thus we describe the stability consequences of different settlement architectures in detail, and also discuss potential improvements to the current architecture, particularly decentralized approaches built on distributed ledgers, to mitigate financial instability and reduce the negative effects of centralization without reverting to inefficient legacy systems.
Decentralized storage is one of the most natural applications built on blockchains and a central component of the Web3 ecosystem. Yet despite a decade of active development -- from IPFS and Filecoin to more recent entrants -- most of these storage protocols have received limited formal analysis of their incentive properties. Claims of incentive compatibility are sometimes made, but rarely proven. This gap matters: without well-designed incentives, a system may distribute storage but fail to truly decentralize it. We analyze Shelby -- a storage network protocol recently proposed by Aptos Labs and Jump Crypto -- and provide the first formal proof of its incentive properties. Our game-theoretic model shows that while off-chain audits alone collapse to universal shirking, Shelby's combination of peer audits with occasional on-chain verification yields incentive compatibility under natural parameter settings. We also examine coalition behavior and outline a simple modification that strengthens the protocol's collusion-resilience.
S. Sivakumar S., Navin kumaar S, Gugan I, Ramya S R · 6 authors
The paradigm shift is a transition to Web3 in the manner digital businesses are structured, operated and monetised. Web2 brought about the centralized platforms, scale of infrastructure and revenue through advertising, to e-commerce, social media, finance and entertainment industries. Nevertheless, due to such models, additional serious problems also arose, and these were exploitation of user information, user monopoly and bad ownership. Conversely, Web3 takes advantage of this characteristic of decentralization, blockchain trust, token economies and community-based governance to help to facilitate user sovereignty and open-value distribution. Although Web3 has all these benefits in terms of security, transparency and user-engagement, barriers to adoption have to do with scalability, usability and uncertainty in regulation. The paper will trace back the comparison between the Web2 and Web3 business model, how the business model has been applied in various industries and how the user interface design has contributed to creation of trust and compliance. In addition to that, it describes the possible approaches to transition to the realm of decentralized ecosystems and the solution to the question of sustainable and future-proof business models on the digital platform.
Smart contracts—auto-executing digital agreements built on DLT (Distributed Ledger Technology), an emerging technology of blockchain—are revolutionizing cross-border payments by enhancing efficiency and automation. However, their widespread adoption is hindered by a fragmented regulatory landscape and legal uncertainties across jurisdictions. Therefore, to promote the urgency of regulatory governance of smart contract, this research advocates for the techno-legal standardization of smart contracts to ensure regulatory compliance in international financial transactions. It investigates how smart contracts can be designed to meet diverse legal requirements while maintaining technical adaptability, scalability, and interoperability. Drawing on interdisciplinary literature and qualitative methods—including expert interviews, surveys, and case studies—the study aims to develop a framework that balances innovation with legal certainty. Key challenges addressed include jurisdictional fragmentation, enforcement mechanisms, integration with legacy systems like SWIFT, and compliance with KYC/AML regulations. The research also examines emerging solutions such as decentralized identity frameworks, trusted oracles, and hybrid on-chain/off-chain models. By bridging the gap between law, technology, and finance, this study offers actionable insights for policymakers, financial institutions, blockchain developers, and international businesses. Ultimately, it contributes to the development of a standardized smart contract ecosystem that supports secure, efficient, and legally compliant cross-border payments.
Iswanda F. Satibi, Maureen A. Leksmana, Dini Pasha Ramadhani
This paper explores the alignment between DAO governance mechanisms, IT governance frameworks, and Indonesia’s regulatory environment. Using a qualitative document analysis of academic literature, DAO governance documentation, IT governance standards (COBIT, ITIL, ISO/IEC 38500), and Indonesian regulatory texts issued by Bappebti, Bank Indonesia, and the Financial Services Authority (OJK), the study identifies critical areas of convergence and divergence. Findings indicate that DAOs demonstrate strong transparency due to on-chain records, but remain weak in accountability, stakeholder alignment, risk management, and compliance. These weaknesses generate friction with Indonesia’s fragmented regulatory landscape, where crypto assets are classified as commodities, prohibited as payment instruments, and inconsistently taxed. Stakeholder management emerges as a pressing concern, as token-weighted voting privileges large holders while Indonesian retail investors face governance literacy gaps. To address these challenges, the paper proposes a hybrid governance framework that integrates IT governance principles with DAO structures, supplemented by compliance mechanisms tailored to Indonesian regulations. Recommendations include the introduction of accountability representatives, adoption of quadratic voting, adaptation of COBIT-based risk management, and establishment of regulatory sandboxes. The study contributes to the discourse on DeFi governance by offering a conceptual model for reconciling decentralized innovation with national regulatory frameworks in emerging markets such as Indonesia.
The problem addressed in this study is the lack of a proper conceptualization of the Distributed Ledger Technology-based Central Bank Digital Currency technical language that guides central banks and their stakeholders in the platforms design and implementation.This research aims to improve the DLT-based CBDC knowledge, proposing a human-centered reference model.We use Design Science Research methodology combined with other research methods.The literature has not provided a reference model that can be used to improve the design of the CBDC system to meet regulatory requirements.This study fills the gap in the literature by presenting a human-centered reference model for DLT-based CBDC that serves as a decision-aid tool to study citizens' needs and behaviors, to design user experience, to improve alignment between cultural values and policy roles, and to facilitate communication between experts and stakeholders on currency digitalization process.
This study investigates the specific factors affecting blockchain or the usage intention of distributed ledger technology (DLT), specifically availability, diversity, and economic value, from the perspective of a unified theory of technology acceptance. Users of DLT in public and private sectors were surveyed. Using a structural equation model, the results indicate that availability and economic value affect performance expectancy, while availability, diversity, and economic value have an influence on effort expectancy. Performance expectancy and transparency have a positive effect on the intention to use DLT, which in turn exerts a positive effect on usage behavior. This study provides implications for researchers in that it attempts to investigate the factors directly (like performance expectancy and transparency) or indirectly (like availability and economic value) affecting the usage intention of DLT based on the extended unified theory of acceptance and encompassing diverse industries that adopt DLT, such as the public, IT, financial, service medical, and logistics sectors.
PURCAREA LIVIU, RADULESCU CARMEN VALENTINA, Mănescu Andreea Maria
Blockchain technology has rapidly transformed the way decentralized systems operate, offering new possibilities for transparency, security, and autonomy. However, these benefits come with a notable drawback: the significant environmental cost associated with blockchain consensus mechanisms — particularly Proof of Work (PoW) Möser et all (2021). This paper examines the environmental impact of blockchain and investigates more sustainable alternatives, such as Proof of Stake (PoS) and other energy-efficient models. Using Ethereum’s transition from PoW to PoS as a central case study, along with examples such as Algorand and Chia, we explore how different architectural decisions affect energy consumption. Our analysis, based on recent academic research and technical data, suggests that sustainable blockchain models are technically viable—but their success depends on broader systemic changes, including clear regulations, governance reforms, and industry-wide engagement. In conclusion, blockchain can evolve into a sustainable technology, but only through a responsible and coordinated effort
Web3 is a fundamental change from a centralized, platform-centric internet to a decentralized, user-owned ecosystem powered by an open-source technology called Blockchain. This shift is not just a technological evolution, but also changes significantly how value is created, delivered, and captured. It enables new products, innovations, and business models. These products are often powered by tokens, whose value is described by their underlying tokenomics. They are designed to engage the community and incentivize the people who interact with the project. The users of Web3 often come together in decentralized autonomous organizations and democratically decide on the next steps and essential developments of the organization. The business models that are now possible because of the capabilities of a decentralized web have different success factors and reasons why they fail. This thesis conducts a systematic literature review and qualitative expert interviews to identify the success factors of Web3 business models. It first lists and categorizes the prevalent Web3 business models, their structures, and revenue models, and then highlights the success factors for Web3 business models. The findings reveal the difference between Web2 and Web3 business models, highlighting the importance of community, decentralization, governance, and robust token economics.
Ruben M Nayve Jr, Ferdinand Timbang, Mark Anthony Pelegrin
This study investigates the role of network effects in shaping economic value creation within cryptocurrency ecosystems. While cryptocurrencies have evolved from speculative assets into complex digital platforms that facilitate transactions, decentralized finance, and governance, their economic sustainability is fundamentally driven by the dynamics of user adoption and interconnectivity. Drawing upon theories of network externalities and digital platform economics, this research employs a mixed-methods approach that integrates quantitative econometric modeling with qualitative analysis of policy and industry practices. Quantitative data, including market capitalization, transaction volume, wallet addresses, and hash rate, are analyzed to measure the correlation between network growth and value creation. Complementary qualitative insights are derived from literature reviews and expert interviews to contextualize the findings within broader regulatory and technological frameworks. The results reveal that network size and user activity exert significant positive effects on value creation, with evidence of nonlinear threshold dynamics: once a critical mass of adoption is reached, economic value accelerates disproportionately. Comparative analysis across major ecosystems such as Bitcoin and Ethereum highlights differences in how network effects interact with technological innovation and governance structures. The findings contribute to advancing theoretical understanding of digital network economies and provide practical insights for stakeholders, including developers, investors, and policymakers. By identifying both opportunities and risks, particularly regarding volatility and regulatory challenges, this study offers a comprehensive framework for evaluating the long-term sustainability of cryptocurrency ecosystems.
Purpose This paper aims to explore the challenges and opportunities of cryptocurrency adoption in Tunisia, focusing on the perspectives of users and professionals. Specifically, it seeks to investigate the underlying factors influencing the adoption and usage of cryptocurrencies in the Tunisian context, including regulatory, technological and socio-economic considerations. By conducting a comprehensive analysis of the motivations, perceptions and experiences of cryptocurrency users and professionals, this research aims to provide valuable insights into the dynamics of cryptocurrency adoption in emerging markets. Through a nuanced examination of these factors, the study ultimately seeks to inform policy decisions, industry practices and future research directions aimed at fostering the responsible and sustainable integration of cryptocurrencies and blockchain technologies into the Tunisian economy. Design/methodology/approach A qualitative approach was used, combining 18 in-depth interviews with professionals alongside netnographic research conducted within two Facebook groups and a Discord group. Data analysis was carried out using T-LAB Plus 2022 software to identify key barriers and motivations to cryptocurrency adoption. Findings The findings reveal four distinct categories of cryptocurrency enthusiasts, along with the primary obstacles to adoption, including regulatory uncertainty, risks of fraud and theft and legal ambiguity. Motivations for adoption include revolutionary sentiments, profit-driven motives and peer influence. Furthermore, blockchain technology is recognized for its potential to enhance transparency and drive economic growth in Tunisia, particularly in sectors such as finance, agriculture and public services. The study reveals key differences between users and professionals in cryptocurrency and blockchain adoption. Users are driven by revolutionary goals and financial gain, while professionals emphasize risks, regulatory ambiguity and the need for clear legal frameworks. This contrast underscores the need for balanced policies that consider both perspectives. Research limitations/implications Limitations of this research include the small sample size due to data confidentiality and the difficulty in recruiting cryptocurrency holders, many of whom were hesitant to participate due to legal concerns. A future quantitative study could further explore these findings and broaden the generalizability of the conclusions, particularly concerning blockchain technology’s potential to drive economic growth. Practical implications The findings of this study highlight the need for regulatory clarity and consumer protection measures to foster trust and legitimacy in the cryptocurrency and blockchain markets in Tunisia. Additionally, educational initiatives and support for blockchain-based projects could promote innovation and economic growth in the region. Social implications Addressing the barriers to cryptocurrency adoption could have significant social implications, including increased financial inclusion, economic empowerment and technological advancement in Tunisia. By fostering an environment conducive to cryptocurrency and blockchain use, the country could position itself as a hub for digital innovation in the region. Originality/value This study offers a unique insight into cryptocurrency adoption in Tunisia, exploring user perspectives in an emerging market facing structural challenges. By comparing user experiences with professional insights, it also sheds light on the divergent views within the ecosystem, offering a comprehensive understanding of the barriers and opportunities in cryptocurrency adoption.
Inbamalar T M, Abarna S, Abinaya G, D. R. · 5 authors
A decentralized Non-Fungible Token (NFT) marketplace website powered by block chain technology enables secure and transparent trading of digital assets has been proposed. Unlike traditional platforms, this system eliminates the central authority and provides full control over their NFTs to the users. It incorporates smart contracts to automate transactions, ensuring efficiency and security. As there is no limit to crypto currency, the marketplace works exclusively through crypto currencies, enhancing global access and minimizing transaction fees. The platform also features a bargaining system, allowing buyers and sellers to negotiate prices directly. By utilizing decentralized storage solutions like IPFS, the project ensures secure, immutable storage of NFT metadata and assets. This website enables users to buy or sell their NFTs. The process involves selecting the desired NFT from the list of NFTs. The next step is the "make offer" system, where the buyer and seller negotiate the price. After that, the price is fixed, and the transaction is processed with the crypto currency in their wallet. Finally, the ownership is updated by the smart contract on the block chain and the database. This website sets a new standard for efficient, secure, and innovative NFT trading. Thus, it motivates people to buy assets from the internet as they have ownership over their assets
Decentralized networks have transcended the confines of Blockchain technology, permeating various spheres of our digital landscape. This chapter explores the profound impact and evolutionary trajectory of decentralized networks beyond Blockchain, elucidating their transformative potential and emerging trends. In addition to monetary exchanges, distributed systems are disrupting workflows of collecting and sharing data, while promoting openness, safeguards, and ownership in the age of data credibility and sovereignty crises. These networks allow Distributed File Systems that store data encrypted and in pieces in numerous nodes. Starting from ride-sharing services to peer-to-peer accommodation, such networks build reliability, effectiveness, and fair distribution of values among the nodes. In the sphere of management and cooperation, distributed systems provide a clear process of decision-making and allow to work together. Through the use of Blockchain and smart contracts, Decentralized autonomous organizations (DAOs) facilitate organisations that are self-governed through collective participation and control of assets and other organisational resources and activities. Also, decentralised networks are creating intrinsic dynamics in identity management where people own their digital identities. By means of self-sovereign identity solutions, the management and exchange of personal data are protected from third-party service providers, thus eliminating such unfavorable consequences as identity theft and surveillance. Some of the general problems being faced by decentralized networks include scale, how different parts of a network work together, and legal concerns. Though the progression of the centralization point can allow monopolization, creation of trust, and stimulation of the demand across various market sectors in terms of networks, the promise of decentralized networks in terms of democratization of access, creation of trust, and stimulation of various domains is unparalleled. Thus, it will be crucial to foster cooperation, prototyping, and better definition of regulatory requirements, which will be the defining decentralised future of the Blockchain technology era.
Introduction Decentralized Autonomous Organizations (DAOs), digital organizations governed by code and community, offer new paradigms for collective governance; yet many early examples have reproduced the power asymmetries, exclusionary participation models, and inefficiencies found in traditional systems. This study examines how DAO governance can evolve to support fair, inclusive, and regenerative capital flows across distributed ecosystems, particularly in contexts where traditional coordination infrastructure is limited. Methods A qualitative case study was conducted on Hypha, an organisation that evolved from a classic DAO to a Decentralized Human Organization (DHO) and subsequently to an Adaptable Organization, or DAO 3.0. Data was collected through semi-structured interviews and document analysis, then interpreted using a People–Process–Technology framework to identify governance design principles. This was supported by a comparative taxonomy mapping the evolution from DAO 1.0 to DAO 3.0. Results Findings show a progression from early token-weighted DAO 1.0 models, through protocol-optimized DAO 2.0 structures, to DAO 3.0’s modular, relational, and context-adaptive designs. Hypha’s governance innovations include multi-layer modular voting, “leadership without control” protocols, real-time capital flow mechanisms, and trust-based safeguards that address fairness failures, enhance adaptability, and enable governance to respond dynamically to human complexity and local contexts. Discussion The Hypha case study positions DAO 3.0 as a prototype for regenerative coordination infrastructure where governance operates as a living system, balancing technological automation with human-centered design. This research expands DAO governance theory by clarifying conceptual boundaries, integrating recent literature, and providing practical guidance for policymakers, developers, and capital providers seeking to design equitable, regenerative governance and coordination systems.
Smart contracts are integral to blockchain technology, enabling decentralized and automated transactions. This study examines 1,000 smart contracts by analyzing metrics such as total transactions, unique users, total value transferred (ETH), gas consumption, and call frequency. Total transactions range from 1 to 18,902, with unique users spanning 1 to 14,839. The average total value transferred is 3,245.87 ETH, peaking at 7,850.16 ETH, while gas consumption averages 25,486,392 units with a maximum of 58,471,065 units. Strong correlations were identified between transaction volume (r = 0.78), user engagement, and gas consumption. Clustering analysis categorizes contracts into low, moderate, and high-activity groups, while anomaly detection highlights 32 contracts with unusual behaviors, indicating inefficiencies or vulnerabilities. These findings emphasize the importance of optimizing smart contract designs to improve efficiency, security, and scalability. The study provides actionable insights into operational patterns and proposes future research directions, including design optimization, real-time monitoring, cross-platform analysis, and machine learning applications for predictive modeling. By addressing these aspects, this research contributes to the ongoing development of robust and efficient decentralized systems.
The concept of Decentralized Autonomous Organizations (DAOs) has introduced a novel paradigm in organizational governance, characterized by more collaborative decision-making. However, the lack of established organizational frameworks for DAOs presents significant challenges to their constitution, stability, and longevity. Aiming to address this shortcoming, this paper presents a conceptual framework to guide the design of the community governance structure of DAOs. To achieve this aim, we employed two complementary methods: firstly, we conducted a systematic literature review about DAOs and community governance; secondly, we conducted an analysis of the governance methods employed by five DAOs operating in public blockchain ecosystems. The proposed framework provides a valuable tool for DAO founders, developers, and community members to design and implement effective governance structures and contributes to the understanding of DAO governance and further research.
Benjamin Kraner, Luca Pennella, Nicolò Vallarano, Claudio J. Tessone
We introduce a micro-velocity framework for analysing the on-chain circulation of Lidos liquid-staking tokens, stETH, and its wrapped ERC-20 form, wstETH. By reconstructing full transfer and share-based accounting histories, we compute address-level velocities and decompose them into behavioural components. Despite their growing importance, the micro-level monetary dynamics of LSTs remain largely unexplored. Our data reveal persistently high velocity for both tokens, reflecting intensive reuse within DeFi. Yet activity is highly concentrated: a small cohort of large addresses, likely institutional accounts, are responsible for most turnover, while the rest of the users remain largely passive. We also observe a gradual transition in user behavior, characterized by a shift toward wstETH, the non-rebasing variant of stETH. This shift appears to align with DeFi composability trends, as wstETH is more frequently deployed across protocols such as AAVE, Spark, Balancer, and SkyMoney. To make the study fully reproducible, we release (i) an open-source pipeline that indexes event logs and historical contract state, and (ii) two public datasets containing every Transfer and TransferShares record for stETH and wstETH through 2024-11-08. This is the first large-scale empirical characterisation of liquid-staking token circulation. Our approach offers a scalable template for monitoring staking asset flows and provides new, open-access resources to the research community.
The unprecedented growth of the cryptocurrency market is driving the development of cryptocurrency wallets, an important interface that enables cryptocurrency transactions. Although a significant amount of research has been conducted in the field of security-related technologies regarding cryptocurrency wallets, user-centric research on cryptocurrency wallets is limited. This research aims to examine the importance of six primary features provided by cryptocurrency wallets to users when selecting a wallet and to measure their payment intents. On analysis, users consider the number of supported currencies to be the most important factor when choosing a cryptocurrency wallet, followed by monthly fees. Users are willing to pay the highest amount when using the wallet as a means of payment, and, regarding the type of wallet, users are willing to pay an additional fee of 3,397 KRW for a web wallet or mobile wallet rather than a desktop wallet. This study contributes to bridging the gap between the theory and practice of using cryptocurrency wallets in circumstances where empirical evidence on user preferences regarding cryptocurrency wallet properties is limited.
Sri Handini, Garry Brumadyadisty, Susanto Soekiman, Denpharanto Agung Krisprimandoyo
The emergence of tokenized derivatives marks a significant innovation in decentralized finance (DeFi), offering potential improvements in market liquidity and pricing efficiency through blockchain-enabled mechanisms. As financial markets evolve with the integration of smart contracts and distributed ledgers, understanding how user perceptions influence market dynamics becomes increasingly critical. This study aims to examine the effect of perceived adoption of tokenized derivatives on market liquidity and pricing efficiency, while assessing the mediating role of liquidity in this relationship. Grounded in the Technology Acceptance Model (TAM), Innovation Diffusion Theory (IDT), and Market Microstructure Theory (MMT), the research utilizes Partial Least Squares Structural Equation Modeling (PLS-SEM) to analyze data from 150 fintech professionals based in Surabaya. The analysis reveals that perceived adoption significantly enhances both liquidity and pricing efficiency, with liquidity serving as a key mediating variable. These findings underscore the importance of behavioral constructs in shaping decentralized market outcomes and provide strategic insights for regulators, fintech developers, and policymakers aiming to accelerate adoption and improve market functionality in the DeFi landscape through perception-driven approaches.