Youssef Faqir-Rhazoui, Javier Arroyo, Samer Hassan
Blockchain technology has emerged as a new paradigm to build decentralized systems which do not require a central authority. It is most popular for enabling Bitcoin and other crypto-currencies. However, blockchain applications span beyond Finance, and recently it has been applied to decentralized governance. Blockchain-enabled "Decentralized Autonomous Organizations" (DAOs) have emerged as a new form of collective governance, in which communities may organize themselves relying on decentralized infrastructure. In this article, we introduce the concept of DAO and review the main software platforms that offer DAO creation as a service, which simplifies the use of DAOs to non-blockchain experts; namely: Aragon, DAOstack, DAOhaus and Colony. These platforms will be compared by showing their key features. Finally, we will review the available visualisation tools for DAOs, and we will introduce our open-source tool to plot DAOs activity, DAO-Analyzer. We will illustrate its potential with the case of the DAO Genesis Alpha, which is the main DAO of the DAOstack project.
We empirically examine the initial returns of Initial Coin Offerings (ICOs) and show that ICO underpricing is enormous, which implies that cryptocurrency markets are inefficient. Moreover, we find that having a short offering phase, not holding a presale, a precisely written whitepaper, and the creation of an independent blockchain all have a positive impact on ICOsâ initial returns. Our results also suggest that the driving factor behind initial returns is the movement of the cryptocurrency markets, measured by both Bitcoin and Ethereum returns. In addition, whether or not the jurisdiction has cryptocurrency regulations is an influential indicator. ICOs that belong to the high-tech services and platform industries have higher initial returns. Conventional financial assets, such as the stock market and gold, have a positive influence on ICOsâ initial returns.
KYC (know your customer) and AML (anti-money laundering) practices have been designed and implemented in traditional financial transactions for some years now. However, it has been complicated to find a balance between business efficiency, innovations, financial inclusion, and compliance, both in the specification of what should be done and in the implementation of a risk-based approach that satisfies the required specification during real business operation. This chapter presents a survey of traditional practices to KYC/AML, highlighting a subset of existing challenges in these practices, taking into consideration the innovation of cryptocurrencies transactions and related innovations, such as digital identity, and the financial inclusion of unbanked people without identity papers. The authors finish this chapter by discussing existing solutions to these challenges both by adopting new KYC/AML practices and by using innovative technological solutions.
With patients demanding services to control their own health conditions, hospitals are looking to build agility in delivering care by extending their reach into patient and partner ecosystems and sharing relevant patient data to support care continuity. However, sharing patient data with several external stakeholders outside a hospital network calls for the development of a digital platform that is trusted by both hospitals and stakeholders, given that there is often no single entity supporting such coordination. In this paper, we propose a methodology that uses a blockchain architecture to address the technical challenge of linking disparate systems used by multiple stakeholders and the social challenge of engendering trust by using visualization to bring about transparency in the way in which data are shared. We illustrate this methodology using a pilot implementation. The paper concludes with a discussion and directions for future research and makes some concluding comments.
Mohammed Shuaib, Salwani Mohd Daud, Shadab Alam, Wazir Zada Khan
The land registry system is one of the very important department in any governance system that stores the records of land ownership. There are various issues and loopholes in the existing system that give rise to corruption and disputes. This requires a significant chunk of valuable government resources from judiciary and law enforcement agencies in settling these issues. Blockchain technology has the potential to counter these loopholes and sort out the issues related with land registry system like tempering of records, trading of the same piece of land to more than one buyer. In this paper, a secure and reliable framework for land registry system using Blockchain has been proposed. The proposed framework uses the concept of smart contract at various stages of the land registry and gives an algorithm for pre-agreement. First, we describe the conventional land registry system and reviews the issues in it. Then, we outline the potential benefits of employing Blockchain technology in the land registry system and presented a framework. Finally, a number of case studies are presented.
Digital economy is relied on the trust of an online authorities. Complex transaction pattern made it difficult to confirm quick transfer of money between hands. Digital transactions provide a platform to make this complex nature of transactions easier for parties involved in online platform. of money Blockchain is a distributed ledger used to have a peer to peer online transaction system without the intervention of any centralized authorities. Blockchain technology facilitates the user with the maximum security during the transaction because the use of the cryptographic hash function by the system which generates a unique output that can not be changed if the transaction is successfully completed. Blockchain also contains a certain verification code for every transaction. It cannot be altered once transaction is completed. Individuals and organizations involved in various monetary interactions need to keep trust on each other. Blockchain technology also keep every record of the transactions being made. Bitcoin is the pioneer cryptocurrency used in blockchain technology is also a peer to peer digital currency.
This work analyses blockchain-mediated decentralization based on a systematic review of the scholarly understanding of the term âdecentralizationâ across multiple disciplines from computer to political sciences, examining how its various meanings are reflected in popular discourse on blockchains and distributed ledgers. The paper aims to capture the rigorous cross-domain understanding of decentralization and its most important features, and to map the commonalities and differences between it and some closely related concepts such as distribution, disintermediation and peer-to-peer (P2P). Across all domains, decentralization appears to be used as a solution to problems requiring non-trivial coordination across heterogeneous stakeholders. Blockchain-mediated decentralization appears to have unique characteristics reflecting an idiosyncratic set of authority-related values prevalent in so-called âcryptoâ online communities. Within blockchain space, the article argues against the binary positioning of âdecentralizationâ and âcentralizationâ, proposing a dialectical approach and arguing that a systemâs authority allocation is a quality positioned on a spectrum between purely decentralized and completely centralized, noting how a blockchain set-up could simultaneously both have facets that are significantly centralized and others that are not. The authors document their systematic review findings and propose a framework for understanding blockchain-mediated decentralization, suggesting a definition, and outlining new directions for further human-centric research into distributed ledger technologies and for designing decentralized ecosystems.
Muhammad Ashraf Fauzi, Norazha Paiman, Zarina OTHMAN
Bitcoin and other prominent cryptocurrencies have gained much attention since the last several years. Globally known as digital coin and virtual currency, this cryptocurrency is gained and traded within the blockchain system. The blockchain technology adopted in using the cryptocurrency has raised the eyebrows within the banking sector, government, stakeholders and individual investors. The rise of the cryptocurrency within this decade since the inception of Bitcoin in 2009 has taken the market by storm. Cryptocurrency is anticipated as the future currency that might replace the current paper currency worldwide. Even though the interest has caught the attention of users, many are not aware of its opportunities, drawbacks and challenges for the future. Researches on cryptocurrencies are still lacking and still at its infancy stage. In providing substantial guide and view to the academic field and users, this paper will discuss the opportunities in the cryptocurrency such as the security of its technology, low transaction cost and high investment return. The originality of this paper is on the discussion within law and regulation, high energy consumption, possibility of crash and bubble, and attacks on network. The future undertakings of cryptocurrency and its application will be systematically reviewed in this paper.
Research by political economists typically highlights policymakers, regulators, economists and consultants as the makers of economies. This paper foregrounds a different actor entirely, what I call the âhacker-engineerâ as an important protagonist in the making of decentralised digital network economies that are forged through the emerging field of âcryptoeconomicsâ and blockchain and other distributed ledger technologies. Responding to critical literature stating that blockchain and âcryptoeconomicsâ merely extend neoliberal processes of economisation, the paper recovers the neglected hacker culture of cypherpunk and histories of peer-to-peer decentralised networks in order to foreground concerns that depart from the continuation of economics and economies as usual. Hacker-engineers are dedicated to decentralisation as a âdisruptiveâ response to network control and surveillance, and share a pragmatist sensibility that seeks to make decentralised networks âworkâ in order to provide informational security and privacy. While further broadening the range of agents that provide the focus for political economy research into the production of economies, the paper also draws attention to the technical decisions of hacker-engineers that attempt to reconfigure the material infrastructures of digital economies.
The perpetual script of a smart contract, that executes an agreement machine-to-machine without prejudice, guarantees performance of âcontractual termsâ enabling the exchange or transaction of cryptoassets and other forms of property. Yet, smart contracts as recognisable or valid legal instruments within the boundaries of contract or property law remain uncertain and contentious. Contrary to perceptions of contractual streamlining and efficiency, understanding the uncertainty smart contracts produce lies in the technology's failure to meet many of the fundamental principles of contract law and theory concerning, for example, breach of promise and remedy for breach. Smart contracts appear to reduce contracting to a form and standard well below that developed by contract law and theory over many centuries in both civil and common law jurisdictions. Including elements of the law of restitution, this article's remedial analysis will examine smart contracts considering âtraditionalâ contract law to understand and, where possible, test the legal legitimacy of this post-human technology, and explore the potential of smart contracts to supplement or, in time, supersede traditional contract law.
ABSTRACT The operational advantages of permissioned blockchains utilize collaborative, private, immutable, append-only distributed ledgers to strategically optimize business results. Accordingly, the importance of related IT governance frameworks is growing. Strategic IT governance, especially regarding permissioned blockchains, is crucial to accurate, valid, and complete accounting data. And while permissioned blockchains such as Hyperledger Fabric, Corda, and Quorum can enhance business collaborations, attention to IT governance is critical. Reviewing blockchain IT governance is necessary if the benefits of encryption, hashing, and distributed ledgers are to be realized. Understanding the potential weaknesses of flawed capacity planning (computational and storage), cybersecurity risks, litigation uncertainty, regulatory refutation, and smart contract vulnerabilities is key. Exacerbating the situation is that many of these weaknesses are likely to grow as permissioned blockchains propagate. If internal auditors do not preemptively address these IT governance issues, both management and internal audit departments could fail their stakeholders. Data Availability: Data are available from the public sources cited in the text.
In this chapter, we investigate the literature on both broad- and narrow-based cryptocurrency research from a bibliometric and scientometric perspective. While Bitcoin, presented as the first every \ncryptocurrency by Nakamoto [2009], was established as the first piece of a decade-long expansion \nof academic literature based on the development of this new financial product and the associated \nbenefits and issues contained therein. We attempt to re-trace and provide a thorough explanation \nof the flow of research direction during this period across all disciplines. We provide clear evidence \nof a growing but fragmented research area. We conclude that there is a significant difference in \nhow researchers treat broad conceptual topics versus individual products. We finally provide a \nconcise overview of the current topics that have been central to recent research efforts, while attempting to provide oversight key areas that have presented evidence of particular deficiency. Such \nrecommendations will provide direction for future research synergy.
The emergence of a decentralized peer-to-peer platform that matches lending and borrowing without collateral requirements has called the bank lending and balance-sheet channels for monetary transmission into question. Via a standard New Keynesian macroeconomic model expanded with two-sided platform and group identity, we put forward a novel platform density channel of monetary transmission, which could overshadow the conventional channels. An increase in policy rate, for instance, would instigate a shift toward platform borrowing. Increasing borrowersâ density attracts participation in platform deposits, which in turn further enhances borrowersâ benefit of joining the platform, making liquidity available at decreasing platform loan rates. Business investment and hence the inflation rate gets lifted despite monetary tightening. The implication of platform density channel diminishes, however, when platform borrowings complement bank borrowings, and pose nontrivial risk of default.
This chapter discusses the environmental aspects of cryptocurrency markets and as to how their \nrapid growth can influence the environment and through which channels this process manifests. \nWhile it is not popular discussion among investors, we find that environmental issues can be of \ninterest by wider society, students, policy makers and stakeholders of FinTech companies. Environmentalism has a long history, and controversy around this subject is remains quite substantial, \nthus to not make our discussion over-complicated, in this chapter we will focus on the area where to \ndate, we possess the most thorough data and evidence through which we can build the case, namely \nelectricity consumption associated with the mining of cryptocurrencies. The total carbon footprint \nof the industry is now estimated to have surpassed that of many large industrial nations. This \nchapter investigates the multiple knock-on effects and consequential behaviour of this rapid growth \nin energy usage, such as an increase in global temperature, the growth of mining companies who \nhave targeted third world infrastructures, and the complete shutdown of the internet as we know \nit. Saying that, we encourage investors not to ignore these environmentalism matters, since we also \nshow that electricity consumption is proven to be one of the commonly used variable in valuation \nof mineable cryptocurrencies and identification of their fair value, which affect investments returns \nand should be considered in their trading strategies.
In this paper, the importance of blockchain technology have been discussed and the generations of blockchain (Bitcoin and Ethereum) have been compared provided different aspects. The blockchain is a technology which allows direct transaction without involving third party. Also, it offers many facilities like high translucency, high safety and security, improved trace-ability, greater proficient and transactions' speed, and reduced costs. Moreover, the cryptocurrencies provide advance security level. The basic purpose of this study is to highlight different aspects of Blockchain, Bitcoin and Ethereum and to show which cryptocurrency is better approach. The research contributes to show the impact of this technology in different fields and a comparison of bitcoin and ethereum is presented to analyze and furnish a decision regarding the best among them.
In 2019, in order to create attractive conditions for the development of the Fintech sector in Singapore, the Payment Services Law was adopted, which consolidated the definition of cryptocurrency (digital payment tokens) and the procedure for its circulation. In addition, this Law established the criteria for distinguishing payment tokens from other virtual objects â securities tokens, utility tokens, game currencies. In the paper, the authors analyze the concept of digital payment tokens as a digital representation of value, consider the rules for transactions with them. It is concluded that the use of this approach makes it possible to minimize difficulties in regulating the turnover of, for example, bitcoins. Based on the Singapore experience, recommendations for the modernization of domestic legislation are proposed. The main difficulty seems to be that the use of the digital value representation mode in relation to cryptocurrency is associated with the need to either establish an extraterritorial regime of regulation in relation to cryptocurrency exchanges, or adopt an international agreement in this area.
Associated with the current development of the emergence of many technologies that have increased in the world, especially in industry, one of which is the blockchain which is a new technology that is undergoing drastic density, this technology has data that is difficult to manipulate so that the blockchain has data security very trusted, and every record of all the contents of the transaction data can be known from one server to another server so that both parties know each other what the activities are carried out. The recording of transactions in this blockchain technology is connected in one block that is secured directly by a computer network, the blockchain itself has several applications such as Cryptocurrency or can also be called digital currencies, and Smart Contracts. This Smart Contracts is an application owned by blockchain technology that carries out an agreement or digital agreement in the computer program code that is entrusted by both parties stored in the blockchain database, so that it cannot be changed by anyone or the help of other parties, then no longer needed entities that can be trusted in using Smart Contracts. These Smart Contracts help to process the exchange of money, shares and property. Currently there are many industries that use Smart Contracts, such as the business industry that records financial services, the health industry which records data on patient health history, even the insurance and government industries also use Smart Contracts, therefore the existence of Smart Contracts is useful to avoid an intermediary service so that a transaction process will be trtransparent.
Matteo Nardini, Sven Helmer, Nabil El Ioini, Claus Pahl
Abstract We propose a framework for building a decentralized electronic marketplace for computing resources. The idea is that anyone with spare capacities can offer them on this marketplace, opening up the cloud computing market to smaller players, thus creating a more competitive environment compared to todayâs market consisting of a few large providers. Trust is a crucial component in making an anonymized decentralized marketplace a reality. We develop protocols that enable participants to interact with each other in a fair way and show how these protocols can be implemented using smart contracts and blockchains. We discuss and evaluate our framework not only from a technical point of view, but also look at the wider context in terms of fair interactions and legal implications.
Initial Coin Offerings (ICOs), i.e. the initial offer of a crypto-token, represent an increasingly popular method to raise money. However, the determinants of ICOsâ returns for investors are still overlooked. Following this cue, the empirical outcomes of our study based on crypto-tokens issued between 2017 and 2018 evidence the main determinants of ICOsâ returns: first, crypto-tokens returns are positively associated to Etherâs returns; second, ICO price is negatively associated to later price increases; third, crypto-tokens returns are lower when they are offered in presale; finally, the more a crypto-token price increases between the ICO and the listing-date on the secondary-market and the more its price rises in the following month. In so doing, we contribute to a better understanding of the ICO phenomenon and highlight which aspects may benefit fund raising, which are relevant for the establishment of new startups and more broadly for the economic development of a country.
Blockchain technology has enabled so-called smart contracts between different parties on a decentralized network. These self-enforceable and self-executable computerized contracts could initiate a fundamental paradigm shift in the understanding and functioning of our legal practices. Opportunities for their application are increasingly understood, and numerous tests of feasibility have been completed. However, only very few use cases have yet been implemented at scale. This articleâas the first of its kindâcomprehensively analyzes the underlying challenges and locates a key reason for the slow adoption in the discrepancy between legal requirements and IT capabilities. Our work combines a wide range of academic sources and interviews with 30 domain experts from IT, the legal domain and private industry. First, we establish that smart contracts still fall within the boundaries of the general legal framework. We then systematically dissect current shortcomings of smart contracts on three distinct levels, namely, (1) how smart contracts are likely to cause conflicts with existing laws, (2) how smart contracts are intrinsically limited on an individual contract level and (3) how they are impeded by their current technical design. Across those levels, we dissect 20 distinct issues concerning the current implementation of smart contracts for which we derive potential remedies. We further outline implications for policy-makers as well as IT management, and examine how information systems research can play an important role in advancing smart contracts. Finally, we show how managerial and organizational issues might represent an ongoing challenge for the widespread adoption of smart contracts.
Stuart Haber and W. Scott Stornetta introduced blockchain in 1991 but real utilization of this technology came in view during the year 2008 in the form of cryptocurrency application by Santoshi Nakamoto. To foster digital trust, blockchain technology plays a vital role. At the early stage, this technology was used for financial transactions only. In application areas where we found the need for data storage, blockchain will add value. Blockchain technology adds verified data by the user in the form of uneditable blocks. These blocks are of fixed size structures that keep on adding in the chronological order to form public ledger in the network. Decentralized, distributed working, robustness, and auditable registry of all the transactions make this technology trustworthy and popular. This encourages utilization of blockchain technology worldwide. It supports to improve the performance and reliability of various business transactions. This chapter focuses on working of blockchain technology along with its applications. Financial applications â blockchain provides traceability and transparency to the financial transactions, which makes it as unique technology to take care of financial applications. Financial applications in the area of banking services, insurance sectors such as health insurance, economic business applications, financial auditing, cryptocurrency payment and exchange are the part of discussion. Non-financial applications like health care â in which blockchain technology helps stakeholders to maintain and share patient records with stakeholders in secure way. Governance â blockchain technology can be turned as path changer for the local and central government to take care of governance. This will help in fixing accountability, for providing automation, and safety to the various governance transactions, which ultimately support to overcome corruption. Business and industrial applications â in the area of business and industry applications, blockchain will improve credibility of the business transactions. Blockchain technology will provide visibility, optimization, and demand across the supply chain management in effective way. These are the certain areas under consideration to discuss as part of blockchain applications.