Blockchain Papers

Olivier Meïer, Aurélie Sannajust

No abstract is available for this record.

Oleksandr Sushchenko, Reimund Schwarze

Climate insurance is already a hot topic due to the increased number of climate-related catastrophic events accompanied by associated losses for the economy in general and insurance companies, in particular. The extremely hot and dry summer of 2018 in some European countries highlighted existing weaknesses of the agricultural insurance mechanisms in Europe, where the farmers had to wait for months before compensation payments could bemade. Our paper aims to compare features of the yield-based insurance2and the index-based insurance (IBI)3in agriculture in the light of new developments and trends in information technologies (IT). The results show that an application of the distributed ledger technologies (DLT) in combination with IBI could not only resolve existing problems, but also facilitate development of the innovative insurance mechanisms at the EU level –providing effective protection against climate-related risks and preventing a systemic risk escalation

Heap‐Yih Chong, Alexander Diamantopoulos

Security of payment (SOP) issues still persist in the construction industry despite numerous investigations and incremental reforms. Various solutions and policies have been proposed and analysed in-depth in previous studies. However, limited studies have focused on the integration of advanced technologies to address SOP issues. The aim of this research is to develop a comprehensive framework that integrates practical advanced technologies to address SOP issues in the construction industry. A concurrent mixed-method design was adopted to (a) identify the industry's perspective on what advanced technologies can be accepted to address SOP issues through a questionnaire survey, and (b) identify the use of advanced technologies through a live construction project as a case study. Subsequently, a data flow diagram framework was developed to articulate the whole process flow of how the system delivers automatic payments to subcontractors upon the completion of their contractual obligations and work done. This research contributes new and practical insights into the application and integration of smart sensors, oracles, BIM, blockchain technology and smart contracts in addressing SOP issues in the construction industry.

Dancho Petrov

Digitalization in finance is an irreversible process, which manifests itself in many different dimensions. Blockchain is an innovative technology that can significantly increase the operational effectiveness of key processes in the financial services industry by reducing costs, enhancing the security and transparency of transactions, and speeding up the settlement process. The idea of smart contracts’ implementation in blockchain is suitable for financial transactions, where a link between fulfilling contractual terms and performing actual transactions is established. The ‘’blockchain - smart contract’’ combination forces the execution of all transactions in accordance with the contract terms and leaves a door, wide open for the automation of key processes. What makes using a ‘smart contract’ beneficial is its ability to eliminate mediation from third parties, such as agents or trustees. The invasion of digital technology is expected to bring dramatic changes in the nature of financial intermediation. This research paper is focused on assessing the expected degree of blockchain penetration and its impact on selected key segments of the financial industry (e.g. global payments, trade finance, capital market trading, syndicated lending, insurance and compliance). Barriers and challenges to the new application’s wide spreading are also analyzed. Based on this research, conclusions about the expected degree of applicability of blockchain in the financial sphere are drawn, and proposals for the initial steps in this direction are made.

Benjamin Van Adrichem

The purpose of this Note is to determine which cryptocurrency initial distribution methods involve the offering of securities as regulated by the 1933 Securities Act. The primary legal issue is the Howey test. This test identifies whether an offering is an investment contract, and thus subject to regulation by the 1933 Securities Act, based on whether it involves an investment of money in a common enterprise, in which investors are led to expect profits from the efforts of a promoter or third party. The distribution methods discussed are mining, airdropping, forking, and initial coin offerings (“ICOs”). Mining, airdropping and forking are likely not investment contracts, but initial coin offerings likely are. However, regulators should make it clear that mining, airdropping and forking are acceptable practices. Furthermore, they should proceed with a light touch when regulating initial coin offerings, except in the case of fraud. In particular, the ICO community in partnership with government should instigate a system where ‘crypto-underwriters’ vet ICOs and the crypto-underwriters are regulated by the SEC.

Yun-seok Choi, Wan Yeon Lee

No abstract is available for this record.

Eliza Mik

The principles of contract law have shown continued resilience in light of constant technological developments, including the mainstream adoption of the Internet. The ability to absorb technological change may be attributable to the broad manner of their formulation. For example, the foundational proposition that ‘legal intention can be expressed in any manner’ has enabled the nearly seamless acceptance of online contracting. If intention can be manifested by a nod or a handshake, it can also take the form of a click or a swipe. Similarly, the requirement of consideration can be met not only by peppercorns or money, but also by one’s permission to share personal information in return for the provision of online content and services. While the Internet hardly creates academic excitement anymore, a number of internet- related technologies may pose a challenge to the principles of contract law and may, finally, test their flexibility. Purportedly, blockchain-based smart contracts, which are often defined as the encoding of legal terms in self-executing computer code, enable not only the automation of performance but also the delegation of enforcement to immutable code. The theory is that if both performance and enforcement are entrusted to impartial machines, breach becomes impossible. Smart contracts are also premised on the ability to translate contractual obligations into algorithms – a process aimed at the elimination of ambiguity and enhancement of legal certainty. Abstracting from technological minutiae, we must inquire whether, or to what extent, such ‘operations’ are desirable or legally permissible. The challenges of automation are further aggravated by advancements in artificial intelligence. The accompanying problems exceed those inherent in the possibility of inadvertent orders, unforeseen transactions or computer errors. We are forced to inquire whether such technological phenomena as algorithmic trading, machine learning or autonomous agents affect the existence of intention and, on a broader level, raise problems concerning the validity and enforceability of any resulting contract – if only due to the unprecedented transactional imbalances introduced by them. An additional set of difficulties concerns ubiquitous computing, loosely defined as the user-facing technologies involving the Internet-of-Things (‘IoT’). Smart objects and self-checkout terminals blur the division between online and offline environments and force a revision of our understanding of ‘online contracting.’ When the Internet spills over our computer screens and when we encounter requests for consent and contractual terms in contexts that have traditionally been non-commercial, it becomes difficult to rely on such basic principles as the objective theory of contract or on the presumption that in commercial contexts the parties intend to be legally bound. The point is not to question the continued applicability of such principles or presumptions but to illustrate the difficulty in their application. In sum, my chapter explores the legal implications of the said technologies and, while abstaining from unnecessary futurism, presents a realistic picture of their legal relevance. Particular attention is devoted to the overreaching question whether the principles of contract law, in their traditional formulation, are capable of accommodating (or withstanding ?) technological change. While it is difficult to predict technological trajectories and future legal developments, it is possible to extrapolate from existing trends and anticipate certain theoretical bottlenecks created by technological change.

Hasan Gül

No abstract is available for this record.

В.А. Кардаков

No abstract is available for this record.

Darcy W E Allen, Chris Berg

Understanding the complexities of blockchain governance is urgent. The aim of this paper is to draw on other theories of governance to provide insight into the design of blockchain governance mechanisms. We define blockchain governance as the processes by which stakeholders (those who are affected by and can affect the network) exercise bargaining power over the network. Major considerations include the definition of stakeholders, how the consensus mechanism distributes endogenous bargaining power between those stakeholders, the interaction of exogenous governance mechanisms and institutional frameworks, and the needs for bootstrapping networks. We propose that on-chain governance models can only be partial because of the existence of implicit contracts that embed expectations of return among diverse stakeholders.

Olusegun Oluwajebe, Mary Duah, Polina Golnikova

No abstract is available for this record.

Cephas Paa Kwasi Coffie, Hongjiang Zhao, Benjamin Kwofie, Emmanuel Dortey Tetteh

Contracts have emerged as an appropriate expanse for the application of Blockchain to eliminate human mediation perceived to be mired by weaknesses. Smart contracts date back to the 1990s, but the proposed Blockchain technology makes it a great force economically. Beyond the transactional processing qualities of blockchain, industries envisage the technology to resolve divergent human-related complications with traditional contracts. Per literature, smart contracts offer superior economic value with respect to legality, formation, deployment, execution, and cost. These qualities of smart contract ensure performance and eliminate risk. Criticised on the inhumane aspect of the technology in terms of contract amendments and the current influx of foreign-based blockchain companies in Africa limiting indigenous design considerations, the application of smart contracts in continent could be hindered by contract renegotiations strongly embedded in cultural values of empathy. Nonetheless, a trade-off would resolve the contractual bottlenecks in Africa.

Xiaowei Ding, Hongyao Zhu

No abstract is available for this record.

Ryan Hasting

Smart contracts are increasingly popular in business and law. Smart contracts are also becoming increasingly complex. Advances in technology allow smart contracts to handle far more intricate transactions than the traditional—and simple— vending machine example. With increased complexity comes increased responsibility. When parties rely on an attorney to review or draft a smart contract, that attorney must understand what he or she is reading or writing. Smart contracts, however, are not written in a language most attorneys can understand, let alone write. While a general description of the contract may be translated into plain English, the contract itself is written in code. If an attorney cannot read the contract itself—and can only read a general description of the contract—can the attorney claim in good faith that he or she possesses the competence necessary to understand the terms of the contract? If the attorney cannot understand the contract, he or she can be held liable for malpractice if the contract leads to results contrary to what the attorney claimed could or would occur. The implementation of smart contracts is likely to give rise to specialized requirements for attorneys drafting and advising on smart contracts. Special requirements are not unheard of in the legal community. For example, to become a patent attorney, one must take and pass the Patent Bar Examination and fulfill other requirements, such as obtaining a bachelor’s degree in specified fields of science or engineering. Similar requirements—either in the form of a smart contract certification or exam—should be developed not only as a measure of attorney competence, but also as a protection against malpractice suits brought forth by clients.

Julian Adam Wise, Meng Chak Chan, Dihon Tadic, Stephanie Miles · 9 authors

Abstract This research demonstrates financial derivative trade of unprocessed materials, for the mining industry through legal smart contracts. Within the mining supply chain, a stock of mined resources can reside in a mineral stockpile for over twenty years without gaining financial interest and without undergoing the mineral extraction process to derive value from the asset. This research elaborates on a blockchain solution implemented to increase miners’ short-term cash flow for business operations through the issuance of derivative assets on mineral stockpiles which can be traded through legally binding smart contracts. The system is the first to enable mining companies’ access to the underlying asset’s value earlier in the production lifecycle through smart contract technology whilst providing hedge funds with access to new financial products for investment portfolios.

Adeola Okesiji, Odunayo Oyasiji, Chikaome Chimara Imediegwu, Okeoghene Elebe · 5 authors

This study presents a comparative analysis of risk models employed by traditional financial systems and emerging blockchain-based fintech platforms, with a focus on their respective risk identification, mitigation, and management mechanisms. As fintech innovation accelerates, the growing diversity of financial technologies necessitates a deeper understanding of how risk is assessed and addressed across different paradigms. Traditional financial institutions have long relied on centralized risk models, utilizing historical data, credit scores, regulatory compliance frameworks, and human oversight to evaluate financial, operational, and credit risks. These models are generally characterized by hierarchical structures, standardized reporting, and strict regulatory supervision. However, such systems may struggle with issues of data latency, limited transparency, and operational inefficiencies. Conversely, blockchain-based fintech platforms leverage decentralized architectures, cryptographic protocols, and smart contracts to manage financial transactions and risks. These systems utilize automated, algorithmic risk assessments that incorporate real-time transaction monitoring, distributed consensus mechanisms, and token-based collateralization to mitigate risks. Blockchain-enabled models also offer enhanced transparency, auditability, and immutability of transaction records. Nevertheless, they introduce new risks, such as vulnerabilities in smart contract code, governance challenges in decentralized autonomous organizations (DAOs), scalability constraints, and regulatory uncertainty in many jurisdictions. This comparative study examines the strengths and weaknesses of both models across key risk categories, including credit, operational, market, liquidity, and compliance risks. It further explores the implications of emerging technologies such as decentralized finance (DeFi) and regulatory technology (RegTech) in reshaping risk management practices. The analysis highlights that while blockchain-based systems offer greater automation and transparency, they require robust technical safeguards and adaptive regulatory frameworks to ensure security and resilience. Ultimately, the study underscores the need for hybrid approaches that integrate the robustness of traditional risk models with the agility and transparency of blockchain technologies to create more resilient, efficient, and inclusive financial ecosystems.

Rosa Siliämaa

Blockchain technology has raised a lot of discussions within academia as well as in financial industry. The founder of Ethereum, Vitalik Buterin, was first to introduce the idea of decentralized autonomous organization (DAO), in which blockchain and smart contracts are used to form a new kind of organization. This concept is at the center of this study: could DAO disrupt the insurance industry?
\nDAO in this thesis is referred to as a system which utilizes transparent blockchain technology and smart contracts while being both governed and owned in a decentralized manner. This qualitative research focuses on providing a comprehensive view on DAO’s potential in insurance industry on a conceptual level. The findings combine expertise gathered from 17 informants in semi-structured interviews. This research describes the changes in insurance value chain. Additionally, several possibilities for DAO utilization in insurance industry were identified. The DAO potential is also reviewed from the perspective of a disruptive innovation, as the main research question of this study aims to understand the disruptive potential (if there is such) of DAO in insurance industry. 
\nThe main finding of this research is that DAO’s disruptive potential in insurance industry cannot be completely denied. However, there are still many open questions which stem from mindset change, regulation, governance, social construction, consumer perspective, quality of information, and technological maturity. The study did not find challenges that would have been seen as unsolvable barriers for DAO adoption. Furthermore, markets where DAO would not have any potential could not be identified. Another key finding concerns how DAO could affect insurance value chain — in essence, DAO has potential to affect all parts of the insurance value chain, depending on the chosen implementation strategy.
\nBased on this research, DAO seems to have manifold potential in insurance industry. Three main categories arose from the expert interviews regarding opportunities to exploit DAO in insurance: (1) peer-to-peer insurance models, (2) new markets, and, most notably, (3) existing companies could also act as DAO exploiters. Specifically, it seems that existing companies may utilize DAOs in three different ways: (1) as internal startup for certain products, (2) as an entity to which a particular part of the value chain is outsourced to, and (3) in a way, we don't know yet.

Phitchayaphong Tantikul, Sudsanguan Ngamsuriyaroj

No abstract is available for this record.

Mohamed Laarabi, Abdelilah Maach

No abstract is available for this record.

Dirk Andreas Zetzsche, Douglas W. Arner, Ross P. Buckley

The emergence of Decentralized Finance (DeFi) signifies a paradigm shift in the financial sector, introducing both unparalleled opportunities and multifaceted challenges. As DeFi continues to redefine traditional financial systems, it becomes vital for stakeholders to grasp the nuances underpinning this evolution, especially the roles of behavioral finance and public policy. This article presents a literature review on financial market regulation, examining the transformative potential of DeFi and its inherent risks, and explores the implications for regulatory frameworks based on behavioral finance. Public policy in the context of DeFi is a delicate balancing act. On one hand, there's the need to protect investors and ensure market integrity. On the other, there's the risk of over-regulating and stifling the very innovations that make DeFi transformative. Policymakers must grapple with these challenges, seeking ways to create regulatory frameworks that are both protective and adaptive. In addressing the question of how to sensibly regulate financial markets in the age of DeFi, the answer may be both straightforward and somewhat counterintuitive: Regulate peers. In a decentralized system where traditional service providers play a diminished role, peers or individual participants may take on functions that are analogous to those of traditional financial operators. Therefore, these peers may find themselves subject to financial market regulations, trade law, tax law, and other applicable statutes, depending on the services they provide, much like platform operators and their obligations.

Ting Chen, Rong Cao, Ting Li, Xiapu Luo · 13 authors

No abstract is available for this record.

Junho Jeong, Yunsik Son, Yang Sun Lee

Smart contract-based development of decentralized applications is increasing with the development of blockchain technology. Although blockchainbased smart contracts are expected to revolutionize the digital economy, several security issues need to be addressed before this technology can be used reliably. The recent discovery of security weaknesses in Ethereum smart contracts questions the reliability of smart contracts. Therefore, there is a need to create and diagnose security weaknesses in Ethereum smart contracts to mitigate security risks. In this study, we assessed the potential security weaknesses of running smart contracts on Ethereum.

Gyung Young Jung

블록체인기술을 기반으로 조건 성취에 따른 계약의 자동실행이 보장된 컴퓨터 프로그램(자동실행코드)으로 정의되는 스마트계약은 그 명칭에도 불구하고 계약 자체는 아니고 계약으로 발전하는 개념으로 이해된다. 스마트계약의 법적 성질은 상대방의 행위로 표시되는 승낙의 의사표시와 합치되면 계약이 성립하므로 이는 일종의 청약의 의사표시라 할 수 있다. 가상세계를 통해 법적 규율로부터 절연된 계약의 이행을 목적으로 탄생된 스마트계약이지만, 그 이익(가치)의 귀속주체가 현실세계의 존재여서 현실세계의 규율로부터 완전히 자유로 울 수는 없고, 인식, 의사결정, 결과가치의 평가, 제3자에 대한 책임 등에서 계약법적 접점을 가지게 된다. 분산형 자율조직(decentralized autonomous organizations: DAOs)이란 스마트계약 프로그램을 허용하는 플랫포옴인 이더리움 등을 활용하여 모집된 투자자의 조직을 의미하고, ‘the DAO’는 최초의 분산형 자율조직으로 탄생하였지만 코드상의 문제로 실패로 귀결되었다. 하지만 ‘the DAO’는 분산형 자율조직에 여러 가지 법적 문제점을 제기했는데, 그 중심은 투자자의 유한책임과 자율적 지배구조가 가능한 분산형 자율조직에 적절한 회사법적 구조는 무엇인가 하는 문제였다. ‘the DAO’는 설계자의 의도와는 달리 현행법 해석으로는 민법상 조합 또는 상법상 익명조합의 성질을 가지게 되어 유한책임, 자율적 지배구조 등의 실현이 어렵다고 본다. 하지만 많은 장점을 가진 분산형 자율조직이 유한책임의 자율적 지배구조를 가지고 양도가 자유로운 토큰을 발행할 수 있기 위해서는 주식회사법제에 포섭될 필요가 있다고 본다. 다만 이를 위해 분산형 자율조직에 주식회사의 설립등기를 요구하거나 불록체인의 익(가)명성의 그늘에서 사실상의 유한책임의 혜택을 보게 하는 것은 완전한 해결책이 아니어서, 분산형 자율조직을 포섭할 수 있는 회사법제의 개정에 관해 연구할 시점이라고 본다.

Byung Jo Yoon

본 연구에서는 아시아 6개국(한국, 일본, 싱가포르, 인도네시아, 말레이시아, 인도)을 대상으로 주식시장의 급격한 하락국면에서 비트코인의 대안적 안전자산 가능성을 실증분석하였다. 표본기간은 2013년 1월 7일부터 2017년 12월 28일까지이며, 국가별 비트코인 가격과 주가지수의 일별자료를 사용하였다. 연구방법론으로는 분포의 꼬리 부분만을 구분해 분석할 수 있는 cross quantilogram 기법을 사용하여, 분위(quantile) 차원에서 안전 피난처의 가능성을 탐색하였다. 본 연구에서 제시하는 표본기간동안의 실증분석 결과는 다음과 같다. 한국의 경우 전통적 안전자산인 금과 달러에 비해 비트코인의 안전 피난처 특성이 강하게 나타났지만, 일본에서는 상대적으로 약화된 현상이 발견되었다. 그리고 싱가포르에서는 비트코인이 금보다 안전 피난처의 특성이 강하고, 인도네시아와 말레이시아에서는 투자 대안처로서의 강도가 3개 자산 모두 비슷하였다. 마지막으로 인도의 경우 모든 자산이 lag에 따라 유사한 특성을 가지는 것으로 확인되었다. 본 연구는 글로벌 금융위기 이후 전통적인 안전 자산의 기능이 점차 약화되어가는 투자환경에서 새로운 대안을 모색중인 시장참가자에게 유용한 결과를 제공할 것이며, 주식시장의 지표가 극단적인 하락추세에 진입했을 때 안전 피난처 자산으로 분류될 수 있는 비트코인, 금, 달러를 포트폴리오 차원에서 비교분석하는데 도움이 될 것이다.This study analyzed whether Bitcoin could be a safe haven in the stock market crash of six Asian countries (Korea, Japan, Singapore, Indonesia, Malaysia and India). The analysis period of the samples was from January 7, 2013 to December 28, 2017, and the daily data of Bitcoin price and stock index were used. In particular, the concept of safety shelter was applied at the quantile level, using a cross-quantilogram technique that can concentrate on the tail of the distribution. The results of empirical analysis during the sample period presented in this study are as follows. In Korea, bitcoin is a safe asset compared to gold and dollar, but in Japan, it has not found the dominant characteristics of bitcoin. And in Singapore, Bitcoin and the dollar are more safe havens than gold, while in Indonesia and Malaysia, all assets have shown potential as investment alternatives.Finally, in India, all assets were found to have similar characteristics. This study will provide useful results for market participants seeking new alternatives in an investment environment where the function of traditional safe assets is weakening after the global financial crisis. It will help to compare bitcoin, gold and dollar that can be classified as assets at the portfolio level.