Abstract We develop a continuousātime control approach to optimal trading in a ProofāofāStake (PoS) blockchain, formulated as a consumptionāinvestment problem that aims to strike the optimal balance between a participant's (or agent's) utility from holding/trading stakes and utility from consumption. We present solutions via dynamic programming and the HamiltonāJacobiāBellman (HJB) equations. When the utility functions are linear or convex, we derive closeāform solutions and show that the bangābang strategy is optimal (i.e., always buy or sell at full capacity). Furthermore, we bring out the explicit connection between the rate of return in trading/holding stakes and the participant's riskāadjusted valuation of the stakes. In particular, we show when a participant is riskāneutral or riskāseeking, corresponding to the riskāadjusted valuation being a martingale or a subāmartingale, the optimal strategy must be to either buy all the time, sell all the time, or first buy then sell, and with both buying and selling executed at full capacity. We also propose a riskācontrol version of the consumptionāinvestment problem; and for a special case, the āstakeāparityā problem, we show a meanāreverting strategy is optimal.
The growth of the enterprise blockchain research supporting supply chain management calls for investigations of their impact and mindfulness of their design, use cases, and pilots. With a blockchain design for the Proof of Delivery (PoD) process management, this paper contributes to learning about performance measurement and the transaction costs implications during the development and application of smart contracts. An experimental design science approach is applied to develop an open-source blockchain to explore ways to make the delivery processes more efficient, the proof of delivery more reliable, and the performance measurements more accurate. The theory of Transaction Costs is applied to evaluate the cost implications of the adoption of smart contracts in the management of the PoD. The findings show that smart contracts make the delivery processes more efficient and proof of delivery more reliable. Yet, the methods and metrics are too complex and qualitative, limiting the smart contract’s capability to measure performance. Our findings indicate potential transaction costs reduction by implementing a blockchain-based performance measurement. The complexities of the delivery process and proof of delivery call for pre-contractual steps to identify the processes and performance metrics to design blockchains. Smart contracts need further development and digital aids to handle qualitative inspections and proof of delivery generation during the delivery process. The blockchain requires the system’s capacity to record off-chain transactions, such as in case of disputes resolutions. The authors extended blockchain research beyond the theoretical level, designing an open-source blockchain for supply chain management within the use case, pilot design, and case study.
On September 15, 2022, the Ethereum network adopted a proof-of-stake (PoS) consensus mechanism. We study the impact on the network and competing platforms in a two month event window around the Beacon chain merge. We find that the transition to PoS has reduced energy consumption by 99.98%. Miners have not transformed into validators, and total block reward income (in USD) has fallen by 97%, though transaction fees (in ETH) for Ether have increased nearly 10%. The Herfindahl index for the top 10 is 1,009; the network is 19% less concentrated after the merge. Ethereum supply growth has been deflationary since the merge. The time between consecutive blocks is now steady at 12 seconds and transactions per day are up 7.0%. On Polygon, Matic fees rose but token fees fell. Polygon also slows, processing 3.3% fewer transactions per day. Solana's fees fall by $0.0003, and transactions per day are down 48%. Stablecoin transfer volumes fall on Ethereum and Polygon, but rise on Solana.
Nowadays, Information Technology (IT) is changing the way traditional enterprise management concepts work. One of the most dominant IT achievements is the Blockchain Technology. This technology enables the distributed collaboration of stakeholders for their interactions while fulfilling the security and consensus rules among them. This paper has focused on the application of Blockchain technology to enhance one of traditional inventory management models. The Vendor Managed Inventory (VMI) has been considered one of the most efficient mechanisms for vendor inventory planning by the suppliers. While VMI has brought competitive advantages for many industries, however its centralized mechanism limits the collaboration of a pool of suppliers and vendors simultaneously. This paper has studied the recent research for VMI application in industries and also has investigated the applications of Blockchain technology for decentralized collaboration of stakeholders. Focusing on sustainability issue for total supply chain consisting suppliers and vendors, it has proposed a Blockchain based VMI conceptual model. The different capabilities of this model for enabling the collaboration of stakeholders while maintaining the competitive advantages and sustainability issues have been discussed.
Ilhaam A. Omar, Raja Jayaraman, Mazin Debe, Haya R. Hasan Ā· 6 authors
Information sharing is essential for coordination and stakeholder integration and is crucial to achieving sustainable supply chain operations. Furthermore, improved information sharing assists retailers by reducing the time spent looking for alternative suppliers to meet the unexpected demand surge during pandemics. Recent advances in networking and distributed ledger technologies have enabled secure, improved information communication and broader connectivity. However, due to system interoperability, information quality, confidentiality, and trust, information cannot be exchanged seamlessly, resulting in the inefficiency of managing supply chain operations. In this paper, we propose a blockchain-based inventory sharing approach based on smart contracts using a private Ethereum network to link suppliers and retailers. Our approach combines blockchain technology with decentralized storage to increase transparency, trust, and security of supply chain transactions. We present a generalized mechanism for secure information sharing that includes comprehensive algorithms to capture supply chain stakeholder interactions that enhance trust among participating entities. The smart contract was developed and validated using the Remix IDE, and the code is made publicly available on Github. We analyze the solution for various security vulnerabilities and provide a detailed cost analysis for various stakeholder transactions in the supply chain. Our solution demonstrates that a blockchain-based approach reduces inefficiencies, is economical, commercially viable, and provides improved information connectivity among supply chain stakeholders in a trusted and secure way.
This paper studies a fundamental problem regarding the security of blockchain PoW consensus on how the existence of multiple misbehaving miners influences the profitability of selfish mining. Each selfish miner (or attacker interchangeably) maintains a private chain and makes it public opportunistically for acquiring more rewards incommensurate to his Hash power. We first establish a general Markov chain model to characterize the state transition of public and private chains for Basic Selfish Mining (BSM), and derive the stationary profitable threshold of Hash power in closed-form. It reduces from 25% for a single attacker to below 21.48% for two symmetric attackers theoretically, and further reduces to around 10% with eight symmetric attackers experimentally. We next explore the profitable threshold when one of the attackers performs strategic mining based on Partially Observable Markov Decision Process (POMDP) that only half of the attributes pertinent to a mining state are observable to him. An online algorithm is presented to compute the nearly optimal policy efficiently despite the large state space and high dimensional belief space. The strategic attacker mines selfishly and more agilely than BSM attacker when his Hash power is relatively high, and mines honestly otherwise, thus leading to a much lower profitable threshold. Last, we formulate a simple model of absolute mining revenue that yields an interesting observation: selfish mining is never profitable at the first difficulty adjustment period, but replying on the reimbursement of stationary selfish mining gains in the future periods. The delay till being profitable of an attacker increases with the decrease of his Hash power, making blockchain miners more cautious on performing selfish mining.
Supply chain finance (SCF), a proposal to address financing problems of small and medium enterprises (SMEs), aims to make working capital optimized by utilizing credit and transaction information through cooperation between upstream and downstream in the supply chain. But some demerits such as information asymmetry and the lack of trust in financing scenarios could still be witnessed in supply chain finance. Blockchain technology, with the characteristics of asymmetric encryption, decentralization, nonrepudiation, and conducting transactions without the supervision of a trusted third party, has revolved multiple stages of development. Smart contracts are regarded as an important derivative technology of blockchain, which are automatically executed by the code between multiple parties through the blockchain without relying on a trusted institution. In this paper, we propose a blockchain-based supply chain financial system combining smart contracts and main methods of supply chain financing to solve the disadvantages of SCF. We select three represented financing modes to design financing platforms with the introduction of smart contracts, and present our schemes in the form of specific pseudo code. All financing processes of supply chain are conducted on the basis of ethereum blockchain. This allows SMEs which have difficulty in capital turnover in the short term, or have insufficient credit to get financial loans more easily compared with traditional financing approaches due to merits of blockchain, and also this could facilitate supply chain to improve financing efficiency for SMEs.
Serkan KarakaÅ, A. Zafer Acar, Berk KĆ¼Ć§Ć¼kaltan
The supply chain is an important source of knowledge that enables potential emerging technologies and, in this ecosystem, logistics are regarded as an intermediary for disseminating innovative solutions in a coordinated manner. As an emerging solution in the supply chain area, blockchain has recently been discussed as a disruptive technology and has received growing attention from academics and practitioners. Despite this interest, insufficient knowledge on the potential benefits and risks of blockchain technology causes vagueness for its successful implementation. Therefore, since effective management of logistics and supply chain operations through advanced solutions is of utmost importance, adopting an innovative approach rather than providing anectodal evidences or narrative expressions plays a critical role in blockchain adoption. Accordingly, this research aims to an in-depth analysis of the blockchain in logistics and supply chain by investigating enablers, barriers, and risks of this adoption. To this end, through employing both the Methodi Ordinatio and the narrative network analyses, the future direction of blockchain adoption is presented in light of the presented current state of knowledge. Consequently, the obtained findings offer academic and practical insights into the ambiguous, insufficiently explained, and conflicted areas in the relationship between blockchain technologies and logistics and supply chain contexts.
Mukuan Junior Salem, Fajar Henri Eranmus Ndolu, Diar Eka Risqi Hidayatullah, Riri Fitri Sari
Weather-based insurance has been developed across emerging economies in many countries. In several Southeast Asia (SEA) countries, weather-based insurance has been released to protect fishermen from the natural events or extreme weather. The value of insurance coverage is obtained from an expensive and lengthy process, especially when facing an extreme weather condition such as sea storm. This adds a heavy toll on fisherman's shoulders when facing the natural conditions. To solve these problems, which is to reduce evaluation costs, blockchain-based smart contracts are used ensure easier asymmetric information. We proposed a blockchain-based smart contract framework that applies to weather-based index insurance. We chose Docker Container and Neo blockchain platform for our experiment due to its easy access tokens from neo-python with a private network. In this experiment we developed a smart contract implementation on Neo. We defined 6 (six) functions that can be triggered if certain conditions are met from an external data application program interface (API). In our experiment of blockchain implementation using Neo, we found that Neo is scalable and trusted and as well having a low memory consumption that could be running in a low specification machine. The deployment of a blockchain based system is feasible to be conducted using Neo platform.
Elnaz Rabieinejad, Abbas Yazdinejad, Tahereh Hasani, Reza M. Parizi Ā· 5 authors
In todayās world, industries are looking to improve their productivity through effective logistics and supply chain management. The efficiency of the supply chain in dealing with the huge volumes of data plays a key role in the overall performance of businesses. Supply Chain Finance (SCF) aims to improve the robustness and efficiency of companiesā supply lines. However, SCF suffers from problems like fraudulent transactions, information inconsistencies, and delays in financial transfers. Decentralized finance (Defi) is a new blockchain paradigm that tackles traditional finance problems. This paper proposes a Defi-based model on a hybrid private-public blockchain for SCF. Our model improves the efficiency of SCF by eliminating costs of using centralized financial institutions, reducing overload costs due to better estimation of the required amount of products, and also decreasing supply delays for the requested products. We also evaluated our model using the SWOT technique for adopting it in the supply chain.
This paper aims to explore how blockchain facilitates supply chain finance (SCF) platform business model reconfiguration. We conduct a case study on a typical Chinese SCF platform to address research questions and propose a blockchain-enabled SCF platform business model framework. The results show that (1) the reconfiguration of the SCF platform business model is driven by internal factors (content, governance, transaction structure) and external factors (sector dynamics, geographical environment, technology) in the context of blockchain. (2) Blockchain influences the SCF platform business model reconfiguration through empowering the operation of SCF information, financial, material, and value flows. (3) The introduction of blockchain changes the business model of the SCF platform significantly, which is mainly reflected in the improved value proposition, expanded value network, strengthened value creation, and generated value appropriation. This study contributes to the existing literature on SCF, business model, and blockchain. The research also provides some important practical implications.
The use of blockchain technology in supply chain finance promises to solve existing inefficiencies of conventional supply chain finance methods. With the help of a systematic literature review, these issues are uncovered, showing how blockchain could solve them. The main problems include the non-transparency of complex networks, insufficient risk control, information asymmetries, and inefficient processes. Blockchain-based SCF platforms can solve these problems with key features such as decentralization, transparency, traceability, and automation capability.
A robust traceability system would help organizations in inventory optimization reduce lead time and improve customer service and quality which further enables the organizations to be a leader in their industry sector. This research study analyzes the challenges faced by the automotive industry in its supply chain operations. Further, the traceability issues and waiting time at different nodes of the supply chain are considered to be priority issues that affect the overall supply chain efficiency in the automotive supply chain. After studying the existing blockchain architectures and their implementation methodology, this study proposes a new blockchain-based architecture to improve traceability and reduce waiting time for the automotive supply chain. A hyper ledger fabric-based blockchain architecture is developed to track the ownership transfers in inbound and outbound logistics. The simulation results of the proposed hyper ledger fabric-based blockchain architecture show that there is an improvement in the traceability of items at different nodes of the supply chain that enhances the Inventory Quality Ratio (IQR) and the mean waiting time is reduced at the factory, wholesaler, and retailer, which thereby improves the overall supply chain efficiency. The blockchain embedded supply chain is more capable to eliminate the risks and uncertainties associated with the automotive supply chain. The benefits of adopting blockchain technology in the automotive supply chain are also described. The developed blockchain-based framework is capable to get more visibility into goods movement and inventory status in automotive supply chains.
Through recent progress, the forms of modern supply chains have evolved into complex networks. The supply chain management systems face a variety of challenges. These include lack of visibility of the upstream party (Provider) to the downstream party (Client); lack of flexibility in the face of sudden variations in demand and control of operating costs; lack of reliance on safety stakeholders; ineffective management of supply chain risks. Blockchain (BC) is used in the supply chain to overcome the growing demands for items. The Internet of Things (IoT) is a profoundly encouraging innovation that can help companies observe, track, and monitor products, activities, and processes within their respective value chain networks. Research establishments and logical gatherings are ceaselessly attempting to answer IoT gadgets in supply chain management. This paper presents orderly writing on and reviewing of Blockchain-based IoT advances and their current usage. We discuss the smart devices used in this system and which device is the most appropriate in the supply chain. This paper also looks at future examination themes in blockchain-based IoT, referred to as the executiveās framework production network. The essential deliberate writing audit has been consolidated by surveying research articles circulated in highly reputable publications between 2016 and 2021. Lastly, current issues and challenges are present to provide researchers with promising future directions in IoT supply chain management systems.
Horst Treiblmaier, Abderahman Rejeb, Remko van Hoek, Mary C. Lacity
Background: Companies partaking in modern supply chains face numerous intra-and interorganizational barriers when it comes to the adoption of blockchain technology. Empirical research is missing that explores how exactly these barriers can be overcome. In this paper we first explore barriers that organizations need to overcome to successfully deploy blockchain technology. In a second step, we investigate the agrifood industry and highlight differences in coping strategies between incumbents and start-ups. Methods: We conducted a quantitative survey with 190 supply chain experts to identify barriers and an in-depth qualitative study that included 10 expert interviews to better understand the current situation in agrifood organizations. Results: The findings from the quantitative study show that the most relevant organizational barrier to blockchain adoption is the widespread lack of understanding of the technology and its potential benefits. In the qualitative study we illustrate how various intra-and interorganizational barriers can be overcome and how the resources and capabilities differ between incumbents and start-ups. Conclusions: Our results provide academics with a better understanding of the relevant barriers and bridges of blockchain adoption. Practitioners benefit from learning about the resources and capabilities they need to deploy in order to benefit from blockchain technology.
Abstract Blockchain is one of the technologies that can support digital transformation in industries in many aspects. This sophisticated technology can provide a decentralized, transparent, and secure environment for organizations and businesses. This review article discusses the adoption of blockchain in the ports and shipping industry to support digital transformation. It also explores the integration of this technology into the current ports and shipping ecosystem. Besides, the study highlighted the situation of the supply chains management in ports and shipping domain as a case study in this field. The investigated studies show that blockchain can be integrated into processes such as financial and document workflow. This review contributes to research by focusing on the adoption of blockchain in the ports and shipping industry to support digital transformation. It also aims to understand the existing port practice and map it with current tendencies based on blockchain. This study gives insight analysis to incorporate blockchain technology into ports and shipping processes globally.
Supply chain management is essential to regulated industries, e.g., food and drug manufacturing. Due to the complexity of the logistic and manufacturing procedures in reality, regulation enforcement and anti-counterfeiting is hard to achieve. To solve this issue, we present a blockchain-based supply chain system which the design is based on the logistic behavioral patterns in the literature, as well as the real-world settings of the industries. Our system had deployed to existing drugs manufacturers and wholesalers in Chain, however, it is possible to apply on any industry. Our design also incorporates digital identity management and quality monitoring, which are the essential services of supply chain management systems. We also analyze the efficiency of our implementation on a typical cloud platform. Our system is efficient and practical for real deployment based on our experimental results.
As blockchain technology has already become a critical priority for enterprises, it is acknowledged that it might be as much important as to reform and reconstruct businesses in the near future. In this paper we review the strengths and weaknesses of the blockchain technology, and present an example application in supply chain management. We start by presenting the key characteristics of the blockchain technology, and then summarize its advantages and vulnerabilities. We also describe some of the existing solutions to known vulnerabilities. Finally, we review and discuss in detail the example of a decentralized application for the supply chain of a frozen food factory. This includes a scenario presenting the implementation of this solution, the steps for the development of the idea, and the constraints of the requirements.
Background: In relevant research, blockchain technology (BCT) is credited with great potential for supply chain management (SCM). However, even after more than 10 years of the technologyās existence, it is barely used for any self-sustaining applications. This raises the question of why BC cannot prevail against its alternatives. With this paper we want to identify criteria by which the added value of BCT can be measured. Furthermore, we want to evaluate how well the different supply chains (SC) exploit the added values of BCT. Methods: For this, we identified real-world examples and case studies for luxury, food, and healthcare SCs. These examples are described in detail and then analyzed for their added value compared to possible alternatives. Results: The results show that in the clusters of food and healthcare SCs, no general added value of BC over current best-practice solutions could be verified. Luxury SCs manage valuable products that are typically traded in small quantities. It is within this cluster that the implementation of BC can be justified best. Conclusions: In conclusion, this study shows that the application of BCT is especially beneficial for goods with a high value and low trade volume. In addition, the interface between reality and the digital twin should be as secure as the database or BC solution itself. Furthermore, the demand for transparency and immutability of data should be more important than the need to protect sensitive data. Finally, SC participants, especially the end customer, must also be able to appreciate the advantages of BCT.
With the evolution and proliferation of blockchain, the technology is becoming more prevalent in enterprise software development. Using the already proven DevOps approach in this setting makes sense, as it can accelerate the general pace of software development and delivery, improve software quality, and increase overall productivity. However, there is currently a lack of guidance on a structured DevOps approach and a breakdown of the specifics in the context of blockchain-based software development. Therefore, we combined gray literature and DevOps application studies from pertinent GitHub projects to systematically investigate current practices and solution approaches for an efficient blockchain-oriented DevOps procedure. In this process, we elaborated procedural steps and related activities according to the main stages of Continuous Integration and Continuous Delivery. Our research shows that core DevOps concepts and activities are similar to other areas and are entirely possible with already established CI/CD solutions that orchestrate the right tools, with the difference that more rigorous testing and differentiated deployment practices are required due to the inherent immutability of blockchain.