Blockchain Papers

Eric Buddensiek, Paul P. Momtaz

No abstract is available for this record.

Qingsong Ruan, Guojun Wang, LI Yun-bo, Yilei Dong · 5 authors

No abstract is available for this record.

Merve Kır, Süphan Nasır

No abstract is available for this record.

Prommy Sultana Hossain, Wang, Xintong, Fang-Yi Yu

Designing automated market makers (AMMs) for prediction markets on combinatorial securities over large outcome spaces poses significant computational challenges. Prior research has primarily focused on combinatorial prediction markets within specific set systems (e.g., intervals, permutations). We introduce a framework for designing AMMs on arbitrary set systems by building a novel connection to the range query problem in computational geometry. This connection enables the analysis of computational complexity and the design of efficient AMMs. We first demonstrate the equivalence between price queries and trade updates under the popular combinatorial logarithmic market scoring rule market and the range query and range update problem. Building on this equivalence, we construct sublinear time algorithms when the VC dimension of the set system is bounded and show the non-existence of such algorithms for unbounded VC dimension cases. We then extend this approach to AMMs for combinatorial prediction markets with quadratic and power scoring rules. Finally, we show that the multi-resolution market design can be naturally integrated into the partition-tree scheme. Additionally, we introduce the combinatorial swap operation problem for automated market makers in decentralized finance and show that it can be efficiently reduced to range update problems.

Chong Zhao Hern, Nadisah Zakaria, Ainin Sulaiman, Foo Siong Min · 5 authors

This study examines the determinants impacting the adoption of cryptocurrencies for exchange. Through a quantitative approach, data from 104 respondents were gathered via an internet-based survey. Employing a Likert scale, the study examined the relationship between financial literacy, perceived usefulness, perceived ease of use, and willingness to adopt cryptocurrencies. Results revealed that financial literacy did not directly correlate with the willingness to adopt cryptocurrencies, while perceived usefulness and ease of use exhibited a positive association with adoption. Notably, the present study highlighted the reliance on perceived financial literacy rather than actual levels. It emphasized the necessity of improving the accessibility and applicability of cryptocurrencies to encourage their adoption. The implications of this study are pertinent to policymakers and businesses venturing into cryptocurrency integration. Understanding the influencers of cryptocurrency adoption, especially perceived utility and ease of use, can inform strategic approaches to foster adoption of cryptocurrencies.

Henrique César Melo Ribeiro

Objetivo do estudo: Investigar as redes sociais formadas e a produção científica do tema Decentralized Autonomous Organization (DAO) divulgada nos periódicos científicos indexados na base de dados EBSCO.Metodologia/Abordagem: Utilizou-se as técnicas de Análise de Redes Sociais e da Revisão Sistemática da Literatura em 11 estudos encontrados.Originalidade/Relevância: Investigar o tema Decentralized Autonomous Organization, que ainda é nascente na literatura científica global.Principais resultados: Estudo sobre DAO ainda embrionário na academia; Alex Norta foi o autor mais profícuo; ACM Computing Surveys foi a revista científica que conseguiu agregar mais autores; as instituições: EDHEC Business School, Jiaotong University, University of New Mexico e Soochow University ficaram em relevo; os países: EUA, China, Taiwan e França ficaram em evidência; blockchain, governance, smart contracts, decentralized finance, investment, cryptocurrencies e distributed ledger technology foram as palavras-chave mais relevantes; os temas mais abordados foram: blockchain e governança.Contribuições teóricas/Metodológicas: Conclui-se de maneira geral uma visão panorâmica do tema DAO na literatura científica internacional, emergindo sua produção científica por meio da formação das redes de colaboração e, mediante uma revisão sistemática de literatura, contribuindo assim para gerar dados, informações e conhecimentos contemporâneos sobre a DAO, podendo com isso auxiliar no surgimento de novos estudos similares a este, e, ou sobretudo, na criação de insights para o alargamento da produção de pesquisas científicas sobre a DAO e seus temas correlatos, possibilitando com isso no seu crescimento como assunto hot-topic na literatura científica global, como também, no meio empresarial.

Bernhard Resch

Abstract Decentralized autonomous organizations (DAOs) promise to be an incubator for a regenerative, mutualist, and democratic economy. But if business is no longer done in firms and workers are neither employed nor managed – what else? This paper argues that a new production architecture inevitably involves an uncomfortable look at the idea of “business” itself, requiring us to reconsider deeply ingrained ideas of scale, ownership, and control. Here, you will find three provocations to institutionally reimagine DAOs for a planetary-conscious future. Bear with me.

Fernando Molina, Pablo Roccatagliata

The implementation of EIP-1559 changed Ethereum’s transaction fee mechanism, including variable-size blocks and a burned base fee that rises and falls with demand. The goal of this paper is to forecast the tip component of the gas price within the new incentive model applied after EIP-1559. An easy estimation of gas price was a design goal in 1559, as it is crucial for the UX experience of users of the Ethereum network. The dataset will include a mix of the most important features and metrics like TVL, market sentiment, NFT aggregated data, and block and transaction information not only for Ethereum but also for potential substitute networks. Our models forecast the non-deterministic part of the gas price (tips), in particular the minimum tip so that a transaction will be included in a block over the next hour with a probability above 90 percent. The observed MAEP for the selected models is below 5 percent.

Hemang Subramanian, Florent Rouxelin

No abstract is available for this record.

Sutta Sornmayura, Nichanan Sakolvieng, Kaimook Numgaroonaroonroj

Objective – This study aims to contribute to the field of cryptocurrency portfolio management and rebalancing strategies by empirically investigating the impact of different allocation frequencies and threshold percentages on the risk-adjusted returns of cryptocurrency portfolios. Methodology/Technique – Utilizing a simulation of 10,000 cryptocurrency portfolios comprising seven assets, including Ethereum (ETH), Bitcoin (BTC), Tether (USDT), Litecoin (LTC), Solana (SOL), Dogecoin (DOGE), and Polygon (MATIC), this study examines and compares the effects of different allocation frequencies (daily, weekly, and monthly) in time-based rebalancing and various threshold percentages (5%, 10%, and 15%) in threshold-based strategies on the portfolios' risk-adjusted returns, using the Sharpe ratio. The performance of these strategies is also compared with a passive buy-and-hold strategy. Findings –The research reveals statistically significant differences in the risk-adjusted returns between the buy-and-hold strategy and the daily rebalancing and threshold-based strategies with 5% and 10% threshold percentages. The daily rebalancing strategy demonstrates a higher Sharpe ratio, while lower threshold percentages lead to better risk-adjusted returns. Novelty – These empirical findings, using a simulation of 10,000 cryptocurrency portfolios, provide valuable insights into optimizing cryptocurrency portfolio performance through rebalancing strategies. Additionally, they highlight the effectiveness of implementing rebalancing techniques in cryptocurrency portfolios, contributing to the understanding of rebalancing optimization in this domain. Type of Paper: Empirical JEL Classification: G11, G19. Keywords: Cryptocurrency; Mean-Variance Optimization; Portfolio Management; Rebalancing Strategies; Risk-Adjusted Returns Reference to this paper should be made as follows: Sornmayura, S; Sakolvieng, N; Numgaroonaroonroj, K. (2024). Optimizing Cryptocurrency Portfolios: A Comparative Study of Rebalancing Strategies, J. Fin. Bank. Review, 8(4), 01 – 16. https://doi.org/10.35609/jfbr.2024.8.4(1)

Akashdeep Bhardwaj

The chapter begins by introducing the concept of virtual economies and their growing significance in the metaverse. It highlights the pivotal role played by cryptocurrencies, such as Bitcoin, in transforming the landscape of virtual transactions. The benefits and challenges of using cryptocurrencies as a medium of exchange in virtual worlds are discussed, alongside the disruptive potential of blockchain technology in enabling secure and decentralized transactions. Furthermore, the chapter delves into the integration of virtual currencies within online gaming platforms, where virtual economies have thrived. It explores the evolution of in-game currencies and the monetization models employed by game developers. The emergence of virtual marketplaces is also examined, wherein users can buy, sell, and trade digital assets. The significance of non-fungible tokens (NFTs) in establishing ownership and uniqueness of digital assets is explored within this context. The real-world impact and economic significance of virtual economies are then analyzed. The chapter investigates how virtual economies have influenced various industries, including gaming, entertainment, and art. It delves into revenue generation and job creation within these virtual economies, showcasing their potential to disrupt traditional financial systems. The chapter also acknowledges the challenges and risks associated with virtual economies. Issues such as fraud and regulatory concerns are discussed, along with potential scalability and interoperability obstacles. Finally, the chapter concludes by summarizing key points and providing insights into future trends and developments in virtual economies. It emphasizes the transformative potential of these economies, offering a glimpse into the promising and complex future of the metaverse.

Monu Rani Bishnoi, Rajneesh Ahlawat

In the blockchain economy, non-fungible tokens (NFTs), which theoretically reflect ownership of a digital asset registered on a public blockchain like Ethereum, have swiftly grown to be a significant component. This chapter explores the complex world of NFTs in marketing, offering a fair analysis of the potential and present difficulties that exist at this nexus. In the first section, the benefits that NFTs provide to marketing are highlighted. They are shown to be able to raise customer engagement, encourage brand loyalty, and transform digital ownership experiences. The ethical implications of ideas like manufactured scarcity, intellectual property, and cultural effects are examined. In conclusion, the chapter offers a comprehensive framework for understanding NFTs in marketing from the perspectives of risk, reward, and ethics. The chapter provides marketers, investors, and stakeholders with a sophisticated understanding to help them carefully and strategically navigate the complicated terrain of NFTs in marketing by deconstructing these crucial components.

Anna Vennonen

No abstract is available for this record.

Antero Eloranta

Maximal Extractable Value (MEV) refers to a maximum value block producers can extract from an Ethereum block by reordering, inserting, or censoring transactions. Pair trading is an investment strategy which involves identifying two closely related assets and taking simultaneous long and short positions in them. This strategy aims to generate returns by exploiting price disparities between the two assets, regardless of the broader market’s direction. The purpose of this study is to examine whether pair trading opportunities can be used as a Maximal Extractable Value extraction method on Ethereum Network. The study expands on the existing literature on Maximal Extractable Value by analyzing new kind of extraction method. This study analyzes decentralized exchange transactions between September 2022 and September 2023 to determine the applicability of pair trading logic as a Maximal Extractable Value extraction method. Pair trading opportunities are identified from the transactions following methodology of pair trading literature and pair trading strategy is found to be profitable over a long period, while individual opportunities tend to make a loss. The strategy is also found to remain profitable during the collapse of FTX, bankruptcy of Silicon Valley Bank, exploitation of Curve which were periods of increased market distress. The majority of the opportunities are relatively time sensitive with the median entry window for positions lasting for slightly over 10 minutes, and the median position must be held being 16 minutes before the position reverts or diverges. The study does not find unambiguous evidence of pair trading opportunities’ characteristics changing under increased market distress. Similarly, the study does not find competition among MEV searchers for the pair trading opportunities having increasing or decreasing trend during the observation period.

Eleunthia Wong Ellinger, Robert Wayne Gregory, Tobias Mini, Thomas Widjaja · 5 authors

Decentralized autonomous organizations (DAOs)—collectively owned human-machine systems deployed on a blockchain that self-govern through smart contracts and the voluntary contributions of autonomous community members—exhibit the potential to facilitate collective action in managing digital commons. Yet the promise of decentralization and collective action is difficult to sustain. To this end, this paper critically examines the transformational potential of DAOs in the case of decentralized finance. Using a polycentric governance lens, we contribute to the literature on technology-enabled forms of organizing with a model explaining the transformational potential of DAOs to facilitate collective action in digital commons. Our study highlights that (1) DAOs are a new form of organizing enabled by blockchain technology in which individuals are free to pursue their objectives within a general system of rules enforced by smart contracts, (2) collective action for managing digital commons can be sustained through a set of three mechanisms—sustained participation, collective direction, and scaled organizing, and (3) DAOs tend to strike a balance between centralized and fully decentralized or community-based governance by implementing a polycentric governance system involving a combination of human and machine agency that creates skin in the game.

Mohd. Nishat Faisal, Lamay Bin Sabir, Maryam Saad Al-Naimi, Khurrum J. Sharif · 5 authors

Abstract The major purpose of this study is to investigate the role of coopetition among supply chains in blockchain adoption leading to sustainability in supply chains. This research uses a three-step process. First, a review of reviews is conducted to search the variables that would positively influence adoption of blockchain in supply chain. In the second step, total interpretive structural modeling (TISM) was utilized to understand the relationships among the enablers. Following the qualitative phase, an empirical study was conducted to test the hypotheses related to the mediating role of coopetition. Review of reviews identified 17 variables that can positively influence blockchain adoption in supply chain. The findings of TISM model revealed the hierarchical relationship among the enablers of blockchain adoption for supply chain management based on their relative importance. The results of the SEM-based study indicated that ‘coopetition’ plays a mediating role between the driver and dependent variables leading to sustainable supply chain. The research offers practical insights to integrate blockchain application in the supply chains leading to better supply chain transparency and ultimately sustainability. The research would support managers to develop suitable strategies to strengthen mechanism to enhance coopetition among competing supply chain to realize the benefits of emerging technologies. The originality of the study lies in the study of variables that influence blockchain adoption in supply chain using a mixed-method approach. Further, the research establishes the critical role of coopetition in achieving the benefits of blockchain adoption.

Peter Stella

The original motivation for the concept paper introducing the Bitcoin blockchain and distributed ledger technology was to enable peer-to-peer transfers of currency and thereby eliminate the role of fiat money, banks and central banks in payments systems worldwide. Although subsequent generations of blockchains have been designed to enable additional applications such as the transfer of artifacts other than their native currencies (eg, tokenized bonds, nonfungible token digital artwork and items or objects purchased in online video games), the most prominent networks continue to stress their decentralized payments or “currency†applications. In this paper we examine the feasibility of the widespread adoption of cryptocurrencies in payments by comparing the output and cost statistics of several centralized payments systems with those of Bitcoin, Ethereum and Solana.

Haifeng Wu

No abstract is available for this record.

Ben Van Vliet

No abstract is available for this record.

Avani Jain

No abstract is available for this record.

Nargess Tahmasbi, Alexander Fuchsberger

Non-fungible Tokens (NFT) have received increased attention since 2021. The availability of the vast amount of public sales transaction data has created an unprecedented opportunity that calls for research to uncover the underlying mechanism in which NFT networks evolve. Our main goal is to understand the new space of NFT-based crypto art exchange and the structure of the trading network. We use data from the Crypto Punks collection and perform a data-driven quantitative study based on real-time trading and sales data to carry out a two-folded methodological approach that is first applied to this domain. We borrow the citation analysis and social network analysis from bibliometrics and the social network domain and apply them to the NFT space to explore the trading network structure. We found that despite being based on unique and non-interchangeable tokens, the NFT-based CryptoPunks transactions network follows the scale-free network structure, the similar pattern that is observed in Web 2.0 social networks and cryptocurrency transaction networks, where a few actors have dominant centrality. Our study demonstrates the applicability of the two approaches from bibliometrics and social network analysis to the context of unique digital assets trading.

Markus Kreutzer, Erwin Hettich, Pia Kerstin Neudert

No abstract is available for this record.

Douglas J. Cumming, Johannes Fuchs, Paul P. Momtaz

Abstract We explore the risk–return trade‐off in international regulation of cryptocurrency markets using a unique sample of regulations implemented between July 2018 and April 2023. Various regulation types have reduced risk in cryptocurrency markets while having differential impacts on raw and risk‐adjusted returns. Given the legal challenges for national jurisdictions in regulating international markets, we develop a digital asset regulatory strength index (DARSI) and study the impacts of national regulatory enforcement quality on the risk and return effects of cryptocurrency regulations. We find that strong enforcement quality, measured based on the strength of formal institutions, amplified the regulations' intended effects. The amplification effect is more pronounced for regulations announced by a financial regulator and for more liquid tokens. Consistent with the view that normative compliance‐seeking facilitates the adoption of norms, we also find that cultural uncertainty avoidance amplifies regulations' intended effects.

Michal Jirásek, E Švandová

No abstract is available for this record.