Blockchain Papers

Marijana Srećković, Goran Šibenik, Dominik Breitfuß

No abstract is available for this record.

Shaen Corbet, Yang Hou, Yang Hu, Les Oxley

Abstract Changing patterns of risk aversion may follow a non-linear counter-cyclical process. However, the evidence so far has not considered developing cryptocurrency markets. Given some unique features of cryptocurrencies, it is interesting to distinguish how these assets differ from traditional products. This paper investigates the time effects of periodicity on risk aversion for a selection of major cryptocurrencies compared to major financial assets. Significant periodic time-varying patterns are identified when analysing risk aversion. Further, bilateral and bidirectional Granger causalities are identified within cryptocurrencies, as well as between cryptocurrencies and traditional financial assets. Bitcoin is identified as a leading information transmitter of the spillover of risk aversion upon other cryptocurrencies, while estimated risk aversion of traditional financial markets plays a dominant role in the spillover processes upon the cryptocurrency cluster. The latter finding presents further evidence of developing cryptocurrency market maturity. The COVID-19 pandemic is found to have significantly influenced the connectedness of risk aversion among cryptocurrency and traditional financial markets.

Arbitration court of the BIA, Gergana Varbanova

The present research aims to analyze the legal relations that arise in the process of tokenization of real assets and their creation as a record certifying ownership in a blockchain network. The peculiarities of using non fungible tokens in the tokenization process and the legal issues raised by the tokenization process itself are discussed. The advantages and disadvantages of the technology at the current stage of the research are indicated and suggestions are given to overcome them.

William Lehr

No abstract is available for this record.

Mimi Zou

No abstract is available for this record.

Ala’ Abu Hilal, Mohamad Badra, Abdallah Tubaishat

This research aims to improve and integrate hospital's healthcare applications with Blockchain and smart contracts technologies to provide huge and secure storage that is immutable. This application will be able to record the patients' medical history like appointments, medical tests, etc.; As a matter of fact, these resources should be recorded to be securely retrieved, modified, and stored by an authorized party only. The utilization of these critical resources will increase the validity for participants with a high level of liability, where building a scheduling appointment system using the blockchain-based on a smart contract will enhance patients' privacy and provides a safer method to keep data away from altering through an unofficial use. COVID-19 Coronavirus is a global disaster that requires a reliable and stable network-based application with a giant and secure platform to hold a huge number of people and settings. The simulated outcomes of the developed system were significant and extremely noteworthy according to immutability and correctness.

Mirko Staderini, András Pataricza, Andrea Bondavalli

No abstract is available for this record.

Masaaki Fukasawa, Basile Maire, Marcus Wunsch

Impermanent Loss in Decentralized Finance can be hedged with weighted variance swaps

Peng‐Fei Dai, John W. Goodell, Luu Duc Toan Huynh, Zhifeng Liu · 5 authors

Abstract We evidence that cryptocurrencies have a higher probability of crashes than equity indices, although such crashes are of shorter duration. Commonality of crash risk between cryptocurrency and equity markets occur in approximately 80% of the periods examined. Further, recently evolved cryptocurrency uncertainty indices are more relevant for predicting co‐crash behavior than economic policy uncertainty. Results are consistent with cryptocurrencies being a growing source of financial instability.

Kose John, Leonid Kogan, Fahad Saleh

We explain the mechanics of smart contracts. We then highlight the benefits of smart contracts, such as overcoming commitment problems. We also discuss limitations, such as the difficulty for smart contracts to access information external to the blockchain and the difficulty of integrating smart contract code with traditional legal enforcement. We further highlight how the absence of a trusted intermediary inflates implementation costs for blockchain applications. We conclude with a discussion of the most prominent smart contract applications in decentralized finance: token issuance (e.g., initial coin offerings, nonfungible tokens), decentralized exchanges, and protocols for loanable funds. Our survey covers both institutional details and relevant literature.

Sang-Lok Yoo, Kwang‐Il Kim, Jang-Young Ahn

No abstract is available for this record.

Barış Soyer

The main purpose of this contribution is to evaluate whether Distributed ledger technology (DLT) could have such a disruptive impact on underwriting commercial insurance contracts, in managing claims and even perhaps in utilising insurance as a financial asset for insurance companies themselves. The position of the parties choosing to enter into an insurance contract by utilising the DLT in the manner described above is not altered in any fundamental manner under English law. It has been suggested that DLT could help to make the securitisation process work in a more efficient manner by enabling the insurance-linked security to be packaged into a token, potentially widening the investor base. In fact, this is a discussion that is a part of a larger debate on how the DLT technology should be regulated within the financial sector; but as far as securitisation of insurance is concerned, one feels that this is a rather premature prospect at this stage.

Joseph Lee

In this chapter, the author discusses how smart contracts can be used for securities transactions on the DLT network. First, the author discusses the legal nature of tokenised securities (crypto-assets) encoded into smart contracts and argues that the legal basis of the underlying assets will continue to govern the rights of the holders. Transfers of tokenised securities also have contract law implications. There are several legal risks involved in such transfers, and there can be systematic failures if these risks are not mitigated. The author proposes to introduce a central counterparty (CCP) system to mitigate these risks. Second, the author discusses how conflict of law issues can affect market safety on the platform and also affect regulatory oversight. The author discusses the difficulties for market surveillance and enforcement proceedings involved in this cross-border securities trading platform. Third, the author discusses how this platform will affect current market practices such as securities lending and proxy voting. Despite any difficulties, there are also positive effects for individual investors. Keywords: smart contract, DLT, blockchain, crypto-assets, securities trading, tokenisation

Olga Bochkareva

Цифровая трансформация строительной сферы является одним из ключевых направлений государственной политики в России. Данное обстоятельство обуславливает актуальность выбранной темы. В статье предложено внедрение технологии смарт-контрактов для регулирования взаимоотношений между участниками инвестиционного процесса в жилищном строительстве. Внедрение данной технологии позволяет автоматизировать весь документооборот, в том числе связанные с условиями оплаты сделок между участниками. Также смарт-контракты подразумевают уменьшение числа вовлеченных людей; полную прозрачность ответственности и бюджета; способствуют повышению эффективности взаимоотношений всех участников договора в условиях цифровой трансформации национальной экономики. The article proposes the introduction of smart contract technology to regulate the relationship between participants in the investment process in housing construction. The introduction of this technology allows you to automate the entire workflow, including those related to the terms of payment of transactions between participants. Also, smart contracts imply a reduction in the number of people involved; full transparency of responsibility and budget; contribute to improving the effectiveness of relationships between all parties to the contract in the context of digital transformation of the national economy.

Kunjian Song, Nedas Matulevicius, Eddie B. de Lima Filho, Lucas C. Cordeiro

Smart contracts written in Solidity are programs used in blockchain networks, such as Etherium, for performing transactions. However, as with any piece of software, they are prone to errors and may present vulnerabilities, which malicious attackers could then use. This paper proposes a solidity frontend for the efficient SMT-based context-bounded model checker (ESBMC), named ESBMC-Solidity, which provides a way of verifying such contracts with its framework. A benchmark suite with vulnerable smart contracts was also developed for evaluation and comparison with other verification tools. The experiments performed here showed that ESBMC-Solidity detected all vulnerabilities, was the fastest tool, and provided a counterexample for each benchmark. A demonstration is available at https://youtu.be/3UH8_1QAVN0.

SUN Xiao-bing TU Liang-qiong

Smart contract is an important component of blockchain platform to realize transactions,which provides an effective solution to the trust problem between multi-party transactions.Smart contracts not only manage high value tokens but also have the characteristics of immutable,which lead to the security threats of smart contracts many times in recent years.At present,a lot of researches have devoted to the security of smart contracts,among which the vulnerability detection of smart contracts has become the main concern.This paper analyzes the security of smart contract systematically.From the perspective of whether to execute the smart contract,vulnerability detection tools are divided into static detection tools and dynamic detection tools.In particular,the vulnerability detection ability of existing detection tools is analyzed,and the principles,advantages and disadvantages of 16 detection technologies are discussed.Finally,the paper gives a prospect of how to improve the security of intelligent contract,and puts forward three research directions which may improve the security of smart contract.

Keaton Manwaring

In this paper, I examine the effect of the May 18th, 2021 Chinese ban of cryptocurrency transactions on the overall volatility of the cryptocurrency market. To do this, I analyze, in both univariate and multivariate settings, range-based volatility in various event windows surrounding the event. I find clear economic and statistical change in volatility in the five days after the ban. In the ten-day period after the ban, there is a moderate economic change in volatility. In the forty-day period after the ban, there is little economic change in volatility. I conclude that the Chinese ban had a clear short-term impact on the volatility of the cryptocurrency marketplace, but the effects wore off shortly thereafter.

Wolfgang Breymann, Nils Bundi, Kurt Stockinger

Future regulatory reporting should be automated to make it more efficient. Moreover, automation enables the supervising authorities to effectively oversee and identify risks of individual financial institutions and the entire financial market. During the last years, we have developed new technologies that are important to reach this goal. These technologies include (i) a suitable standardized representation of financial contracts, (ii) a standardized way of carrying out financial analytics, (iii) Big Data technology required to process hundreds of millions of financial contracts and (iv) Distributed Ledger and Smart Contract technology to create a secure layer for automated reporting. In this work, we provide an overview of these technological elements that are required to reach an earlier established vision of future financial risk reporting.

Yannis Kalfoglou

Global networks like Bitcoin emerged and became prominent in a short time. Smart contracts began appearing in literature and research work as early as the mid-nineties when Szabo first coined the term to denote that contractual clauses can be programmed into some sort of hardware or software and be self-executable with little or no human supervision and involvement. The popular view on smart contracts is that they can automate the execution of interactions between parties without the need to involve a trusted intermediary. A smooth transition from the codified deterministic world of computer science to the legalese and argumentative dynamic world of legal contracts is challenging. Binding a conventional legal contract is typically done when all parties in the contract agree to the terms. Conventional legal contracts that are legally binding can be enforced if the terms of the contract are not followed by either party.

Saha Reno, Sheikh Surfuddin Reza Ali CHOWDHURY, Iqramuzzaman SADI

Lending systems in real world are not much secure and reliable as the borrower and third parties involved in this aspect may create various deceitful situations. Blockchain is a secure system where the utilization of smart contract can avoid deceptive phenomena involved in lending but the decline in exchange rate of cryptocurrency can create the opportunity to pay back less than the borrowed amount in terms of fiat money. In this paper, a blockchain and smart contract-based lending framework is designed which requires the borrower to provide Ethereum Request for Comments (ERC)-20 standard tokens as collateral to mitigate the associated risks. The smart contract feature is utilized to automate the system without any third-party management. Besides, transaction stored in the blocks creates transparency among the users of the system. To tackle the aforementioned issues, ERC-20 token value is increased periodically and the instability of the exchange rate is surveilled by the system. By the end of this paper, some test cases and charts relevant to the data set are evaluated to assess the effectiveness of the system.

Alexander Fleiss, Gihyen Eom, Daria Tikhonova, Eric Tu

We compare the explainability of cryptocurrency returns from macro and microeconomic risk factors during stressed and normal market environments, in particular, analyzing the effects of the Covid-19 pandemic to cryptocurrency return explainability. We find that risk-premiums are encapsulated within cryptocurrency-specific market factors in both stressed and normal market conditions. Furthermore, cryptocurrency factors, particularly relating to liquidity, momentum, and counterparty risk, showed evidence of providing stronger predictability of cryptocurrency returns during the Covid-19 pandemic compared to pre-pandemic levels. We find that during the stressed market environment, Fama-French 5 factors continue to provide low explainability to cryptocurrency returns.

Junggil Kim, Jung-Gil KIM

이 글은 계약법적 관점에서 스마트 계약의 성립에 중점을 두 고 논하고 있다. 여기에서 주목할 것은 스마트 계약의 성립이 전통적 계약 성립의 개념에 해당하는지 여부이다. 즉 스마트 계 약이 기존의 계약과 동일한 의미를 가지는지, 그렇지 않으면 계 약 성립의 끝을 의미하는지, 그에 따른 새로운 계약의 시작인지 의 문제를 살펴본다. 그리고 기존 계약법이 원칙적으로 스마트 계약의 성립을 통제할 수 있는지 검토한다. 그렇다면 스마트 계 약이 전통적 계약법을 넘어서는 혁신적 특성은 무엇인지에 대 해서 고찰한다. 이러한 문제의식을 가지고 다음 내용 순으로 살펴본다. 첫째, 계약의 발전 단계와 과학기술의 발전 과정에서 스마트 계약이 출현하게 된 배경을 살펴본다. 그리고 우리 사회에서 스마트 계 약을 어떻게 고려하고 있는지 살펴본다(Ⅱ). 둘째, 스마트 계약 의 개념에 관해 검토한다. 기술적 측면 및 법적 측면에서의 논 의를 정리한다(Ⅲ). 셋째, 계약의 성립을 중심으로 전통적 계약 과 스마트 계약의 정합성에 대하여 평가한다(Ⅳ). 끝으로 스마 트 계약이 계약법의 미래에 어떠한 영향을 미칠 수 있는지를 고찰한다(Ⅴ).

V Niranjani, V.S. Akshaya, V Harish, S. Abhishek

Block chain has the distributed infrastructure and considered to be a part of the next revolution in the technology space. The super ledger is considered to be the part of latest instalment of the block chain which is getting evolved very fast and the latest is the third instalment. The block chain helps change how we handle finance and accounting now and this paper expounds the various application and its various status of it in the accounting and finance industry which is taken from the view of very large data. This paper also focuses on various other main points which takes on building the non-reversible system which is also completely distributed. The source is also took from a very large data to apply in the “Block Chain Technology and accounting services” and also the main advantages of the application of block chain in the accounting industry and finance industry that also provides inspiration and many motive for many future research on block chain in accounting and finance. This paper also discussed about the fundamentals of block chain in any field including the accounting and finance on the way it works behind the scenes.

Corinne Boismain

International audience