Lorenzo Ceragioli, Letterio Galletta, Pierpaolo Degano, Luca Viganò
In a decentralized environment, exchanging resources requires users to bargain until an agreement is found. Moreover, human agreements involve a combination of collaborative and selfish behavior and often induce circularity, complicating the evaluation of exchange requests. We introduce MuAC, a policy language that allows users to state in isolation under which conditions they are open to grant their resources and what they require in return. In MuAC, exchange requests are evaluated automatically with the guarantee that the only exchanges that will take place are those that mutually satisfy users' conditions. Moreover, MuAC can be used as an enforcement mechanism to prevent users from cheating. As a proof of concept, we implement a blockchain smart contract that allows users to exchange their non-fungible tokens.
Kota Chin, Keita Emura, Kazumasa Omote, Shingo Sato
In an open-bid auction, a bidder can know the budgets of other bidders. Thus, a sealed-bid auction that hides bidding prices is desirable. However, in previous sealed-bid auction protocols, it has been difficult to provide a ``fund binding'' property, which would guarantee that a bidder has funds more than or equal to the bidding price and that the funds are forcibly withdrawn when the bidder wins. Thus, such protocols are vulnerable to false bidding. As a solution, many protocols employ a simple deposit method in which each bidder sends a deposit to a smart contract, which is greater than or equal to the bidding price, before the bidding phase. However, this deposit reveals the maximum bidding price, and it is preferable to hide this information. In this paper, we propose a sealed-bid auction protocol that provides a fund binding property. Our protocol not only hides the bidding price and a maximum bidding price, but also provides fund binding, simultaneously. For hiding the maximum bidding price, we pay attention to the fact that usual Ethereum transactions and transactions for sending funds to a one-time address have the same transaction structure, and it seems that they are indistinguishable. We discuss how much bidding transactions are hidden. We also employ DECO (Zhang et al,. CCS 2020) that proves the validity of the data to a verifier in which the data are taken from a source without showing the data itself. Finally, we give our implementation which shows transaction fees required and compare it to a sealed-bid auction protocol employing the simple deposit method.
Distributed ledger technology (DLT) is a disruptive technology with the potential to reengineer the entire trading cycle by alleviating inefficiencies such as time lags, multiple record keeping, human errors, and transparency common with the traditional trade cycle. This study evaluates the potential benefits of DLT in mitigating information asymmetry in trading relationships and how a DLT model can be deployed to revamp the trading process. We find that information friction results from differences in stakeholder preferences by identifying and categorizing information friction into 4 groups through a review of key studies in leading management journals. This finding aligns with conclusions reached in scientific research that the benefits of DLT prevail in markets with imperfect information. In addition, we illustrate the potential benefits of DLT in mitigating inefficiencies in trading relationships resulting from information asymmetry. The article concludes with a word of caution for potential users to take gradual steps of adoption to keep pace with changing technology so as not to become laggards.
This article examines the implications of Distributed Ledger Technology (a.k.a. blockchain) for several areas of law. While cryptocurrencies have received much attention, the implications of DLT are potentially far reaching. DLT raises interesting and important questions relating to rules of evidence, surrounding issues like hearsay and authentication. The advent of initial coin offerings has implications not only for how firms are financed but also for securities law in regulating such offerings. Cryptocurrencies themselves (e.g., Bitcoin) have raised serious issues for tax avoidance and taxation law. Relatedly, the rise of cryptocurrencies raises issues regarding the relationship between private and nationally issued currencies, and even the role and efficacy of monetary policy. Finally, DLT has practical implications for election law and voter turnout, with such technology already begun to be used for security purposes in online voting and permitted in 32 US states.
With the rapid development of cloud computing and the sharing economy, crowdsourcing aroused widespread interest and adoption in providing intelligent and efficient services for humans. The majority of existing works focus on effective crowdsourcing task assignment and privacy protection, mostly relying on central servers and assuming that participants are$honest$-$and$-$curious$and proactive. However, in reality, workers may be unwilling to participate, and there may be malicious behavior among participants, thus harming the enthusiasm and interests of other participants. The central server has weaknesses such as single point of failure. To address above problems, we propose a blockchain-based framework for crowdsourcing with reputation and incentive. We first design a worker selection scheme to select credible and capable workers. We leverage reputation as a metric of workers’ credibility, which is calculated through the improved subjective logic model. Then we utilize contract theory to design incentive mechanisms to attract more workers, especially high-quality workers to participate. Experimental results show that our proposed method can detect and prevent malicious participants and resist malicious collusion when the proportion of malicious participants is no more than 1/3. And encourage more workers to actively, honestly and continuously participate in crowdsourcing.
Blok-lanac tehnologija pruža mnoge mogućnosti kao što su neizmjenjivost podataka, sigurnost i distribuiranost. Zbog navedenih svojstava blok-lanac tehnologija počinje se primjenjivati u širokom spektru industrija, a jedna od tih industrija je i industrija video igara. U radu će se opisati nekoliko igara razvijane koristeći blok-lanac tehnologiju te implementirati aplikacija na Ethereum platformi.
Smart contracts provide the means to stipulate rules of interaction between mutually distrustful organizations. They encode contractual agreements on the basis of source code, which else need to be contractualized in natural language. While the mediation of contractual agreements via smart contracts is seamless in theory, it requires that the conditions of an interaction are accurately made available in the blockchain. Time is a prominent such condition. In the paper at hand, we empirically measure the consistency of a smart contract to yield equal results on the basis of the time of an interaction and its potentially inaccurate representation in the blockchain. We propose a novel metric called execution accuracy to measure this consistency. We specifically measure the execution accuracy of a time intervalconstrained smart contract that executes distinct logic within and without some constraint interval. We run experiments for the local Ganache and Quorum and the public Görli and Rinkeby Ethereum blockchains. Our experiments confirm our intuition that execution accuracy decreases near interval bounds. The novelty of our proposed metric resides in its capacity to quantify this decrease. We demonstrate how time constraints can be effectively stipulated on the basis of execution accuracy measurements.
Cilj ovog završnog rada je bio implementirati NFT-ove koji referenciraju stvarne uređaje kojima može upravljati samo vlasnik dotičnog NFT-a te web stranicu gdje se takvi NFT-ovi mogu kupovati i prodavati. NFT-ovi predstavljaju vlasništvo nad uređajima. Nove NFT-ove mogu dodati korisnici stranice, a ne samo njen vlasnik. Uređaji potvrđuju da je netko njihov vlasnik pomoću digitalnog potpisa. NFT-ovi su implementirani na Ethereumu.
Ensuring functional correctness of smart contracts is a pressing security concern to blockchain-based systems. With the development of blockchain application, the trading scenarios and function implementation of smart contracts have become increasing complex, containing several interacted contracts or related functions. However, the existing contracts verifiers for proving functional correctness focus on verifying isolated contract or function but ignore the interactions between them, which makes it difficult to verify correctness of composite transactions, i.e., complex transaction scenarios that invoke multiple contracts or trigger a set of transactions. In this paper, we present SMIFIER, a formal verification tool for smart contracts to prove functional properties in composite transactions. SMIFIER defines a set of specifications for composite transactions and can automatically specify properties in these multiple complex transactions. Based on states extraction and mapping, SMIFIER translates annotated Solidity program into Boogie program and verifies relations between functions and properties for interacted contracts. Our experimental evaluation on 12 real-world projects and 65 properties, demonstrates that SMIFIER is practically effective in ensuring functional correctness of properties in composite transactions.
Decentralized autonomous organizations (DAOs) are blockchain-based organizations fed by a peer-to-peer (P2P) network of contributors. Their management is decentralized without top executive teams and built on automated rules encoded in smart contracts, and their governance works autonomously based on a combination of on-chain and off-chain mechanisms that support community decision-making. A growing body of literature has emerged exploring DAOs. However, there is a considerable lack of clarity about this organizational design and its theoretical conceptualization. To this end, we undertake an integrative literature review that reveals three main principles—decentralized, automated and autonomous organizations—and the following four theoretical perspectives mainly adopted to examine this novel organizational form: transaction cost theory, institutions for collective action, agency theory, and socio-materiality. By extending these theories, we propose an integrative model of DAO for research and theory building. Our contribution provides conceptual clarity and proposes a framework for future research directions.
Abstract: Smart contracts are self-executing, deterministic scripts that run transparently on top of a blockchain. They enable trusted transactions and agreements between anonymous parties without the need for a trusted figure or authority. The smart contract code and agreement between the parties are publicly available on the blockchain, making transactions transparent, traceable, and irreversible. Smart contracts have the potential to revolutionize and disrupt numerous industries' traditional operating procedures. Although research on smart contracts has yielded significant results, their full potential remains untapped. A bibliometric analysis was performed in this paper to obtain a holistic overview and to assist academic researchers in developing a comprehensive understanding of the state of scientific research on smart contracts. 513 articles on smart contracts were extracted and analyzed using biblioshiny and VOSviewer from the core collection of the Web of Science (WOS) database. Influential journals, top authors, most contributing countries, and impactful articles in the smart contract domain are revealed. A three-fields plot is constructed to show the interactions between the most relevant sources, author key words, and countries, providing a deeper understanding of the state of global research on smart contracts. Furthermore, keyword co-occurrence analysis identified four clusters representing underlying research streams: (1) smart contracts technology and its applications in healthcare (2) applications of smart contracts in supply chain management (3) smart contracts for the Internet of Things (IOT) (4) Smart contracts for business ventures on consortium blockchains Finally, future research directions are suggested based on areas of low coverage but high potential impact
The production control for the mass individualisation paradigm of R&D-stage products is challenging due to the mix-flow and frequently-disturbed environment. With the convergence of the sustainable development goals and the increasing individualised demands in products, resilient manufacturing is envisioned in Industry 5.0 proposition. Concerning that conventional centralised production control methods suffer from low stability and inefficiency of decisions under frequent disruptions, this paper establishes a blockchained smart contract pyramid-driven multi-agent autonomous process control (BSCP-MAAPC) approach for improving the timeliness and adaptability of control towards resilient individualised manufacturing. Firstly, a blockchain-based multi-agent system architecture is designed based on agent encapsulation of manufacturing units. Blockchained smart contracts are used as the enabler of the multi-agent system for peer-to-peer negotiation and coordination of tasks. Secondly, a quad-play blockchained smart contract pyramid together with a series of decentralised control patterns are designed to enable the initial task dispatching of various individualised demands, as well as rapid dynamic adjustment of schedule in response to internal random disruptions. Finally, a blockchained smart contract pyramid-driven multi-agent autonomous process control system prototype is built in the ManuChain system, and experiments are conducted to analyze the proposed BSCP-MAAPC approach in different environments.HIGHLIGHTSA blockchained smart contract pyramid-driven multi-agent autonomous process control (BSCP-MAAPC) approach.A quad-play blockchained smart contract pyramid together with a series of decentralized control patterns.Blockchained smart contracts as the enabler of the multi-agent system for peer-to-peer negotiation and coordination of tasks.
Governance in blockchain platforms is an increasingly important topic. A particular concern related to voting procedures is the formation of dominant positions, which may discourage participation of minorities. A main feature of standard majority voting is that individuals can indicate their preferences but cannot express the intensity of their preferences. This could sometimes be a drawback for minorities who may not have the opportunity to obtain their most desirable outcomes, even when such outcomes are particularly important for them. For this reason a voting method, which in recent years gained visibility, is quadratic voting (QV), which allows voters to manifest both their preferences and the associated intensity. In voting rounds, where in each round users express their preference over binary alternatives, what characterizes QV is that the sum of the squares of the votes allocated by individuals to each round has to be equal to the total number, budget, of available votes. That is, the cost associated with a number of votes is given by the square of that number, hence it increases quadratically. In the paper, we discuss QV in proof-of-stake-based blockchain platforms, where a user’s monetary stake also represents the budget of votes available in a voting session. Considering the stake as given, the work focuses mostly on a game theoretic approach to determine the optimal allocation of votes across the rounds. We also investigate the possibility of the so-called Sybil attacks and discuss how simultaneous versus sequential staking can affect the voting outcomes with QV.
We are often faced with the non-trivial task of designing incentive mechanisms in the era of Web3. As history has shown, many Web3 services failed mostly due to the lack of a rigorous incentive mechanism design based on token economics. However, traditional mechanism design, where there is an assumption that the users of services strategically make decisions so that their expected profits are maximized, often does not capture their real behavior well as it ignores humans' psychological bias in making decisions under uncertainty. In this paper, we propose an incentive mechanism design for crypto-enabled services using behavioral economics. Specifically, we take an example of a crypto lottery game in this work and incorporate a seminal work of cumulative prospect theory into its lottery game mechanism (or rule) design. We designed four mechanisms and compared them in terms of utility, a metric of how appealing a mechanism is to participants, and a game operator's expected profit. Our approach is generic and will be applicable to a wide range of crypto-based services where a decision has to be made under uncertainty.
Roi Bar-Zur, Ameer Abu-Hanna, Ittay Eyal, Aviv Tamar
Blockchain technology is responsible for the emergence of cryptocurrencies, such as Bitcoin and Ethereum. The security of a blockchain protocol relies on the incentives of its participants. Selfish mining is a form of deviation from the protocol where a participant can gain more than her fair share. Previous analyses of selfish mining make easing, non-realistic assumptions. We introduce a more realistic model with varying block rewards in the form of transaction fees. However, this comes at the cost of an intractable state space. To solve the complex model, we introduce WeRLman, a novel method based on deep Reinforcement Learning (deep RL). Using WeRLman, we show reward variability can significantly hurt blockchain security.
Alyssa Blackburn, Christoph Huber, Yossi Eliaz, Muhammad Shahzads Shamim · 9 authors
Bitcoin is a digital currency designed to rely on a decentralized, trustless network of anonymous agents. Using a pseudonymous-address-linking procedure that achieves >99% sensitivity and >99% specificity, we reveal that between launch (January 3rd, 2009), and when the price reached $1 (February 9th, 2011), most bitcoin was mined by only sixty-four agents. This was due to the rapid emergence of Pareto distributions in bitcoin income, producing such extensive resource centralization that almost all contemporary bitcoin addresses can be connected to these top agents by a chain of six transactions. Centralization created a social dilemma. Attackers could routinely exploit bitcoin via a "51% attack", making it possible for them to repeatedly spend the same bitcoins. Yet doing so would harm the community. Strikingly, we find that potential attackers always chose to cooperate instead. We model this dilemma using an N-player Centipede game in which anonymous players can choose to exploit, and thereby undermine, an appreciating good. Combining theory and economic experiments, we show that, even when individual payoffs are unchanged, cooperation is more frequent when the game is played by an anonymous group. Although bitcoin was designed to rely on a decentralized, trustless network of anonymous agents, its early success rested instead on cooperation among a small group of altruistic founders.
This dissertation is composed of two main research projects. The first, which was conducted with my adviser Xiaoming Song as a continuation of her work with with her previous student Nathan Anderson-Stahl. In that chapter, we consider a class of general backward stochastic differential equations and backward doubly stochastic differential equations to provide a standard method to prove the existence and uniqueness of the Lp solutions and to obtain the Lp estimates for the solutions. The other project was conducted in collaboration with Josh McGinnis and corresponds to the second chapter in which we provide a physical zero knowledge proof for the popular app game Flow Free. We then show that the methodology can be extended to provide zero knowledge proofs for the related graph problems of the paired many-to-many disjoint covering path problem, the unpaired many-to-many disjoint covering path problem and Hamiltonian cycles.
Smart contracts constitute the foundation for blockchain distributed applications. These constructs enable transactions in trustless environments using consensus algorithms and software-controlled verification rules. In the current state of the art, there is a shortage of works on the adaptability of smart contracts, and the re-use of their source code is limited mainly to cloning. The paper discusses the pattern of smart contract design and implementation with the overt declaration of verification rules. The author introduces two advantages of the pattern: Firstly, run-time reconfigurability of the list of smart contract verification rules to adjust for various transaction types. Secondly, the re-use of verification rules between different configurations of the smart contract, and among diverse smart contracts. The paper uses blockchain platform-independent stereotypes from a dedicated Unified Modeling Language (UML) profile for designing smart contracts and verification rules. The implementation of the pattern is developed in object-oriented Java language. The pattern exploits polymorphism and controls inheritance by using sealed classes with permission for specialization only for selected final ones. Thus, the pattern ensures two recently highly desired properties in smart contract design and development: re-use and security. Moreover, the declared verification rules list facilitates test automation and reduces test preparation effort due to the re-use of test classes among smart contract configurations. The pattern usage is illustrated in the example of renewable energy exchange within the prosumers community and amid various communities.
As an emerging blockchain technique, the blockchain-based loot box has received significant attention recently due to its promising characters in transparency and decentralization. Because all virtual assets are bound to the players' own address, which allows the players to control and manage everything, players can trade virtual items via the 2nd exChange Market (2CM) directly. To understand the players' optimal strategies and the game provider's optimal pricing, we conduct an economic analysis of both the game provider's and players' behaviors. In addition, gas fee, a unique factor in blockchain, is taken into consideration. Specifically, we model the interactions between the game provider and players as a two-stage Stackelberg game. In Stage I, we model the game provider's optimal pricing problem to maximize his utility using prospect theory (PT) due to the intrinsic demand uncertainty. In Stage II, the players choose the market which can maximize their utility to derive their preferred items. Moreover, our analysis and numerical results show that a game provider who considers the PT modeling should adopt a conservative pricing mechanism to increase his utility. Besides, the primary market is more susceptible to gas fees than the 2CM.
Proof of Authority (PoA) is a type of permissioned consensus algorithm with a fixed committee. PoA has been widely adopted by communities and industries due to its better performance and faster finality. In this paper, we explore the unfairness issue existing in the current PoA implementations. We have investigated 2,500+ in the wild projects and selected 10+ as our main focus (covering Ethereum, Binance smart chain, etc.). We have identified two types of order manipulation attacks to separately break the transaction-level (a.k.a. transaction ordering) and the block-level (sealer position ordering) fairness. Both of them merely rely on honest-but-profitable sealer assumption without modifying original settings. We launch these attacks on the forked branches under an isolated environment and carefully evaluate the attacking scope towards different implementations. To date (as of Nov 2021), the potentially affected PoA market cap can reach up to 681,087 million USD. Besides, we further dive into the source code of selected projects, and accordingly, propose our recommendation for the fix. To the best of knowledge, this work provides the first exploration of the unfairness issue in PoA algorithms.