The research and thinking pertaining to blockchain have thus far focused on cryptocurrency and Bitcoin. However, there is increased interest in using the technology to solve operational challenges in manufacturing and service supply chains. In this study, we introduce a new implication of using blockchain technology and propose two unique contributions. First, we introduce the notion of computational costs (measured in units of gas) as an essential mechanism for completing operational transactions in the blockchain environment. Second, we discuss the use of smart contracts and their influence on operational transactions. To investigate the link between blockchain transaction and computational costs, this study uses an experimental methodology. We develop and implement a fully functional virtual public blockchain to store, validate, and maintain transactions. The methodology provides a process to measure the computational costs, frequency, and intensity of transactions. This research contributes to conceptual research on the blockchain implementation paradigm. Its novelty stems from the identification of computational costs for operational transactions and use of an experimental methodology. This research provides managers an insight into the design of smart contract transactions in a supply chain from a cost perspective.
The article deals with the content of the tax on cryptocurrency, which is an innovative IT instrument of economic development. It has been established that there was no common understanding of the official status of cryptocurrency given that each state establishes it in the framework of its national legislation independently, and the introduction of taxes is one of the instruments of state influence on the cryptocurrency circulation. It has been found out that the EU member states had only one restriction on the taxation of cryptocurrency, namely cryptocurrency transactions were not liable for VAT. Foreign experience in taxing cryptocurrency transactions is considered in the article. It has been established that Ukraine offered the most optimal tax rate on income from cryptocurrency transactions for individuals and legal entities. At the same time, the significance of the economic effect of the cryptocurrency tax in the form of revenues to the state budget due to the unstable cryptocurrency exchange rate is disproved, which raises the issue of the feasibility of search for new areas of state influence on cryptocurrency.
O objetivo geral deste trabalho foi, a partir de um caso de estudo, criar um modelo de Sistema em blockchain e smart contracts, para gestão da tributação da prestação de serviços digitais com base no local do usuário à luz da Teoria da Agência. O trabalho foi guiado pelas diretrizes do método Design Science Research (DSR), proposto na área de Sistema de Informações. O artefato resultado deste trabalho, a partir do caso de estudo, foi um Sistema Unificado de Tributação Automática (SUTRA), como solução viável à ausência de um ambiente que integre empresas prestadoras de serviços digitais, seus usuários e entes tributantes, mitigando a assimetria informacional, existente entre estes atores, e suas consequências. A contribuição teórica deste trabalho foi no sentido de relacionar estudos relativos à teoria da agência e blockchain no ambiente tributário, especificamente no que tange à assimetria de informação, controles de tributação e mitigação de fraudes tributárias. A contribuição prática deste trabalho foi propor um artefato, baseado em blockchain e smart contracts, que integre empresas prestadoras de serviços digitais, seus usuários e entes tributantes, em um único ambiente onde possam compartilhar informações entre si.
Roger Bons, Johan Versendaal, Liudmila Zavolokina, Weidong Shi
New ways to organize economic activities are emerging, facilitated by Blockchain technology or the broader term Distributed Ledger Technology. Blockchains consist of dynamic shared ledgers that can be applied to ensure transparency and traceability and to save time when recording transactions between parties, remove costs associated with intermediaries (or, according to Nakamoto ( 2008 ), remove the need for intermediaries altogether), while enabling the introduction of pseudonymous parties on the Internet. First, and probably the most known application of blockchain technology, is cryptocurrency, such as Bitcoin. It has taken businesses and industries some time to recognize that the underlying technology of Bitcoin could be the next wave for disruption of their existing business models. All too often, the focus of the media coverage is on the connection of cyber-currencies to criminal activities or on the highly speculative nature of their exchange rates and issues with coin exchanges.
Distributed ledger technologies (DLTs) have been celebrated for promoting transparency, trust, and efficiency in several domains. However, recent research has also pointed out the potential of these technologies to increase power asymmetries and deepen social inequality. In this paper, we contribute to this discussion by reporting on a collective effort of academics, development partners, local authorities, businesses, and farming groups to look at the potential of DLTs, particularly Blockchains, to support socio-economic development in rural communities in the Caribbean. We present a series of design concepts resulting from this effort and reflect on a method to facilitate stakeholders' experience of possible implementations and enable them to voice concerns, preferences, and expectations. Results from workshops with different groups of stakeholders contribute insights into opportunities and limitations of these applications to enable social development and to level the playing field in agricultural exchanges in developing countries.
Purpose This paper aims to examine the role blockchain can play for record-keeping by exploring what information from a record-keeping system it is possible to publish to a blockchain. A credible approach is presented, followed by a discussion on both benefits and limitations. Design/methodology/approach The approach is a combination of theorised possibilities verified with practical software implementation. The basis for the work is relevant record-keeping and blockchain literature. Findings The results show that it is possible to separate the formal record keeping structure from content, and this opens for new possibilities when integrating record keeping and block chain technologies. However, the approach does come with some limitations. Research limitations/implications The approach is beneficial where there is a record-keeping standard that has a clearly defined metadata model, and that also makes use of globally unique identifiers. Privacy legislation, for example, GDPR, may limit the scope of an implementation of the approach. Originality/value The originality lies in presenting an approach whereby a record-keeping standard is analysed, separating structural and content information to publish structural information to a blockchain.
Friederike Rühmann, Sai Aashirvad Konda, Paul Horrocks, Nina Taka
The achievement of the Sustainable Development Goals (SDGs) demands unprecedented resources and efforts. Remittances as one of the largest development finance flows are an important source of income for millions of households in developing countries and offer tremendous potential to contribute towards the achievement of Agenda 2030. However, the high cost of sending remittances limits their full potential. The global average cost of sending USD 200 is 6.9% of the remittance. SDG 10 C aims to reduce the cost to less than 3% and to eliminate remittance corridors with cost higher than 5% by 2030. Blockchain technology promises to disintermediate banks, transform the financial landscape and drastically reduce the cost of cross-border transactions, yet there is a need for further evidence on this topic. The OECD Development Co-operation Directorate (DCD) has developed this paper to provide an overview of diverse perspectives on the intersection of blockchain technology and remittances by exploring the opportunities and challenges of this technology for reducing the cost of remittances. The paper identifies several limitations, such as data privacy risks, regulatory uncertainty and last-mile delivery, among others, while investigating whether blockchain technology is the solution to reduce the cost of remittances.
The birth of Bitcoin ushered in the era of cryptocurrency, which has now become a financial market attracted extensive attention worldwide. The phenomenon of startups launching Initial Coin Offerings (ICOs) to raise capital led to thousands of tokens being distributed on blockchains. Many studies have analyzed this phenomenon from an economic perspective. However, little is know about the characteristics of participants in the ecosystem. To fill this gap and considering over 80% of ICOs launched based on ERC20 token on Ethereum, in this paper, we conduct a systematic investigation on the whole Ethereum ERC20 token ecosystem to characterize the token creator, holder, and transfer activity. By downloading the whole blockchain and parsing the transaction records and event logs, we construct three graphs, namely token creator graph, token holder graph, and token transfer graph. We obtain many observations and findings by analyzing these graphs. Besides, we propose an algorithm to discover potential relationships between tokens and other accounts. The reported case shows that our algorithm can effectively reveal entities and the complex relationship between various accounts in the token ecosystem.
The performance of existing permissionless smart contract platforms such as Ethereum is limited by the consensus layer. Prism is a new proof-of-work consensus protocol that provably achieves throughput and latency up to physical limits while retaining the strong guarantees of the longest chain protocol. This paper reports experimental results from implementations of two smart contract virtual machines, EVM and MoveVM, on top of Prism and demonstrates that the consensus bottleneck has been removed. Code can be found at https://github.com/wgr523/prism-smart-contracts.
Paul Babie, David W. Brown, Ryan Catterwell, Mark Giancaspro
On 8 April 2020, Gendall J, sitting in the High Court of New Zealand, decided Ruscoe and Moore v Cryptopia Limited (In Liquidation), providing the most recent and authoritative common law statement in the world on whether a cryptocurrency is property. The case provides significant guidance for any jurisdiction, common or civil, faced with determining whether cyrptocurrencies are property. This note outlines the approach taken to ‘the property question’ by Gendall J, in four parts. Part I introduces the property question. Part II provides a brief overview of blockchain and the nature of cryptocurrencies. Part III briefly recounts Gendall J’s reasons for the judgment concluding that cryptocurrencies are property. Part IV offers some brief reflections on the implications of the decision for property and for the relationship of property to contract.
In this technological era, Cryptocurrency emerged as a means of payment. One example is Bitcoin which has been widely used as a virtual currency. The Bitcoin system itself is based on Cryptocurrency and is decentralized and uses peer-to-peer networking and cryptography-based technology that can maintain the integrity of the data. With the easy use of Bitcoin, the demand for Bitcoin continues to increase every year while the limited amount of Bitcoin causes the value of Bitcoin to experience volatility. This study was conducted to determine whether there is an influence between the economic variables of bitcoin, currency bitcoin as an intervening variable, and the money supply in the country of Thailand. This research uses observation years January 2016 - June 2019. The methods used are Descriptive Statistics, Simple Linear Regression, test Classical Assumptions, and t test. The results show that the bitcoin economy has a significant positive effect on the bitcoin currency but the bitcoin currency does not affect the amount of money supply and the currency bitcoin is not an intervening variable because the bitcoin economy can directly influence the amount of money supply without passing through the currency bitcoin first, meaning that the people in Thailand still use bitcoin as an investment tool not as a transaction tool.
Abstract Over the past decade, technological innovations have changed the dynamics of the financial system. As a result, firms have used cellular phones, the Internet, and digital currencies to facilitate exchanges and operate their businesses. This course of action affects the transmission mechanism of monetary policy. The goal of the present study is to examine the role that fintech plays in the transmission mechanism of monetary policy. First, we analyse the income velocity and the money multiplier during pre‐fintech and post‐fintech periods. The results confirm that there is no change in income velocity and the money multiplier during these periods. Second, we develop the money demand function to examine the effect of monetary policy and demonstrate that low monetary policy rates lead to an increase in money demand. When we introduce fintech components to examine their impact on money demand, we find that mobile and Internet technologies and all digital currencies considered in this study are robust predictors of money demand. Third, we analyse the product market equation and report that after the initiation of fintech, monetary policy has a significant effect. To examine the cost function, we incorporate fintech components and identify that cellular phones, Internet technology, Litecoin, and Ethereum are the determinants of the output gap. Finally, we examine the drivers of fintech and determine that the real interest rate, GDP, inflation, the financial development index, and stock market indices are significant determinants of fintech.
Abstract Whether it is legally treated as a digital property, a commodity or a security, bitcoin’s identity crisis is mainly caused by its contradictions as a trustless monetary project. The paper argues that bitcoin’s trustlessness is a confusing concept that accounts for its legal and monetary troubles. As explicated by monetary sociologists and economists, money is based on a complex trust architecture. By questioning the interplay between code, trust and law in the monetary realm, the paper aims to enlighten the philosophy of bitcoin’s monetary project, the current trends, and some potential developments for bitcoin and distributed ledger technologies.
This paper describes the economic characteristics of crypto-assets and the regulation of the exchanges and custodian wallet providers adopted in various jurisdictions. The possible accounting and prudential treatments are then analysed. The paper provides a taxonomy of DLT digital tokens based on mutually exclusive classes. Bitcoin belongsto the class of private digital tokens with no underlining claim or liability against an issuer, exchangeable at a floating rate, which operate through an electronic protocol called permissionless distributed ledger technology (DLT). The literature on the subject shows that this type of crypto-assets do not fall within the category of money and financial instruments. The instability of their price must be considered when evaluating these instruments from an accounting and prudential point of view. The paper describes the basic features of initial coin offerings (ICOs), smart contracts, and other related aspects.
Blockchain has been gaining focus in research and development for diverse industries in recent years. Nevertheless, innovations that impact to the banking nurture a potential for disruptive impact globally for economic reasons; however it has received less scholarly attention. Hence the effect of blockchain technologies on banking industry is systematically reviewed. The relevant literature is extracted from Scopus, Web of Science and bibliometric techniques are applied. While a bulk of earlier papers focuses only on bit coins, a broader framework is envisaged that synthesizes interdisciplinary thematic areas for advancement; hence novelty in current work. A few practical and theoretical implications for stakeholders in view of technology, law and management are discussed.
The combination of Internet technology and the financial industry makes information more symmetrical, improves the efficiency of payment and settlement in the financial industry, reduces the cost of currency financing, and makes risk management more effective based on big data technologies. Just the improvement of form and means has not changed the nature of finance. With the development boom of financial technology, blockchain technology seems to have become the key to start a new technological revolution. The value transfer of blockchain technology and the absence of credit intermediation, high security, decentralization, and de-monetization are a fundamental disruption of the financial industry.
This paper studies the economic functions of blockchain. First, by explaining blockchain technologies from an economic perspective, it introduces the Token Paradigm to summarize mainstream blockchain systems, discusses the true meanings of consensus and trustlessness in the blockchain field, and analyzes the functions of smart contracts. Next, it categorizes major blockchain applications according to how they use tokens and discusses relevant economic problems such as tokens’ monetary features, tokens’ impacts on blockchain platforms, blockchain’s governance functions, and the efficiency and security of blockchain systems. Finally, it discusses the concept of Blockchain as a Financial Infrastructure (BaaFI), which is represented by central bank digital currencies (CBDC) and global stable coins.
An increasing number of industries rely on Internet-of-Things devices to track physical resources. Blockchain technology provides primitives to represent these resources as digital assets on a secure distributed ledger. Due to the proliferation of blockchain-based assets, there is an increasing need for a generic mechanism to trade assets between isolated platforms. To date, there is no such mechanism without reliance on a trusted third party. In this work, we address this shortcoming and present XChange. Unlike existing approaches for decentralized asset trading, we decouple trade management and the actual exchange of assets. XChange mediates trade of any digital asset between isolated blockchain platforms while limiting the fraud conducted by adversarial parties. We first describe a generic, five-phase trading protocol that establishes and executes trade between individuals. This protocol accounts full trade specifications on a separate blockchain. We then devise a lightweight system architecture, composed of all required components for a generic asset marketplace. We implement XChange and conduct real-world experimentation. We leverage an existing, lightweight blockchain, TrustChain, to account all orders and full trade specifications. By deploying XChange on multiple low-resource devices, we show that a full trade completes within half a second. To quantify the scalability of our mechanism, we conduct further experiments on our compute cluster. We conclude that the throughput of XChange, in terms of trades per second, scales linearly with the system load. Furthermore, we find that XChange exhibits superior throughput and order fulfil latency compared to related decentralized exchanges, BitShares and Waves.
There is a shared view among practitioners that the blockchain is a revolutionary, decentralized technology that will have a larger impact than the Internet. Firms are increasingly using blockchains for various applications; the most prominent of which to date are digital currencies. In this article, we aim to increase our theoretical understanding of the driving forces behind the success and volatility of digital currencies. We use a detailed dataset of 345 digital currencies for our explorative analysis and identify some of the key factors that can explain their performance. We find that the success and volatility of digital currencies depend on their business type (i.e., whether they relate to a platform business or not) and on their technology type (i.e., whether they are based on their own specialized blockchain technology or on a third-party standardized platform blockchain). Our findings suggest that, paradoxically, to obtain the promised benefits of this decentralized technology, firms need to centralize part of it to retain control over critical strategic dimensions (data and rules for transaction). We discuss the implications of our discovery for other contexts undergoing digital transformation.
Purpose Blockchain is expected to have a significant impact on Systems of Innovation as the new General Purpose Technology. The purpose of this study is to investigate how Blockchain can revolutionise the Systems of Innovation by investigating its overall structure, actors and relationships. Design/methodology/approach This study used the systematic mapping method to explore and integrate the Blockchain and Systems of Innovation literature for the creation of a new conceptual model of Blockchain-enabled Systems of Innovation. In that scope, 37 Blockchain-related and 32 Systems of Innovation-related papers, besides two major books in the field of Blockchain, have been reviewed and then integrated based on the Systems Thinking approach. Findings The key findings for Blockchain-enabled Systems of Innovation are that there is (1) an increased distribution of networks and collaborations, (2) increased trust through the use of reputation systems, (3) an emerging new nature of platform characteristics, (4) a democratisation of entrepreneurship by the new funding landscape and (5) an increased significance of technological drivers, such as energy. Research limitations/implications The study shows new Systems of Innovation-related research implications. Accordingly, a new type of actor, relationship and attribute has been introduced where the boundaries of the role definitions are blurred and more distributed. This is where larger organisations can expect to lose their central position. The different types of actors are replaced by a network of actors as a result of the distributed new Blockchain-based system. The threshold for the Bottom of the Pyramid is expected to be reduced, leading to a more democratised innovation system. Practical Implications Blockchain appears to reduce the effects of distrust in collaborative innovation practices with its consensus mechanisms and the new Blockchain-enabled Systems of Innovation is expected to revolutionise the interactions in the future. Originality/value There are very few studies that have been found to integrate innovation management practices with Blockchain. This is the first Blockchain-based Systems of Innovation study enabling the fundamental revision of its structure, types of relationships and actors.
of-ethereum-92b543594e84 [https://perma.cc/BWZ2-6PJE].2 In terms of reporting and withholding, the same problems arise in the cash economy, which is responsible for a significant amount of noncompliance with tax laws around the world.But in terms of the identification of reportable transactions, there may be base defining issues.The