The impact of digital transformation is becoming visible in every aspect of our lives. Digital transformation strategies mostly rely on disruptive technologies such as Internet of Things, augmented reality, artificial intelligence, and blockchain. Blockchain provides decentralized, immutable, and trustless database distributed across all participants and it was initially proposed as distributed ledger for digital cryptocurrency. However, besides in the finance sector, blockchain technology is considered to be a major innovation enabler in various industries. The paper describes an implementation of a private blockchain using the Multichain open source platform with possible application to agrifood use cases such as food tracking and tracing, product lifecycle management, and counterfeit prevention.
Management of public finance and economic development is the art by which a nation improves the economic, political and social well-being of its people. The research paper starts from the reality that finance plays an important role in each economy. Nowadays, finance has to manage and adapt to Digital Era. The purpose of this paper is an attempt to identify and encourage managing financial statements through artificial intelligence using XBRL and Blockchain. In many countries, financial and tax authorities encourage the adoption of eXtensible Business Reporting Language (XBRL) and Blockchain. XBRL enable business to generate their required reporting information directly from their financial data. Blockchain technology continues to grow and it is being used in more and more business sectors. Finance, accounting and auditing has been identified as areas that could greatly benefit the distributed registry and other features of Blockchain. The main benefits generated by these innovative tools include reducing the risk of error (especially human error); low risk of fraud; system automation, big data analysis, huge cost savings (by increasing the efficiency and decreasing in errors), increased reliability in financial reports, and reduced workflow. The research paper comes to present how artificial intelligence combine financial information with tech capabilities, accelerate digital transformation of finance and accounting, and may create a more safety business and economic environment, reducing human error. We have to manage our work and time differently. We are living in a digital and intelligent era, where machines take over repetitive, time-consuming and redundant tasks, giving finance professionals more time to approach higher level and more lucrative analysis and research.
Open banking becomes more and more prevailing in Australia in recent years. It aims to make the users’ personal financial data mutually transfer and exchange across different banks in a secure way. The sensitive data in a financial area requires higher authentication and provenance for participants. In this paper, we propose a provenance-provided data sharing model (PPM) via blockchain to meet the requirements of open banking. The model employs the programmable smart contracts as the middle witness between users and third-party services, and provides the modifications on data layer (data content, transaction structure), smart contract layer (ACL, logic), and application layer (customized APIs). Based on that, our PPM model possesses the properties of transparent authentication, privacy-provided control, and auditable provenance. The analyses and discussion show that our model is a secure and achievable system in the face of open banking.
Stefan Tönnissen, Jan Heinrich Beinke, Frank Teuteberg
Abstract Start-ups in the blockchain context generate millions by means of initial coin offerings (ICOs). Many of these crowdfunding endeavours are very successful, others are not. However, despite the increasing investments in ICOs, there is still neither sufficient theoretical knowledge nor a comprehensive understanding of the different types of business models and the implications for these token-based ecosystems. Scientific research equally lacks a thorough understanding of the different business model forms and their influence on collaboration in token-based economies. We bridge this gap by presenting a taxonomy of real-world blockchain-based start-ups. For this taxonomy, we used 195 start-ups and performed a cluster-analysis in order to identify three different archetypes and thus gain a deeper understanding. Our taxonomy and the archetypes can equally be seen as strategic guidance for practitioners as well as a starting point for future research concerning the token-based business models.
Abstract A zero-knowledge proof or protocol is a cryptographic technique for verifying private data without revealing it in its clear form. In this paper, we evaluate the potential for zero-knowledge distributed ledger technology to alleviate asymmetry of information in the asset-backed securitization market. To frame this inquiry, we conducted market data analyses, a review of prior literature, stakeholder interviews with investors, originators and security issuers and collaboration with blockchain engineers and researchers. We introduce a new system which could enable all market participants in the securitization lifecycle (e.g. investors, rating agencies, regulators and security issuers) to interact on a unique decentralized platform while maintaining the privacy of loan-level data, therefore providing the industry with timely analytics and performance data. Our platform is powered by zkLedger (Narula et al. 2018), a zero-knowledge protocol developed by the MIT Media Lab and the first system that enables participants of a distributed ledger to run publicly verifiable analytics on masked data.
Sami Ben Mariem, Pedro Casas, Matteo Romiti, Benoît Donnet · 6 authors
Blockchains are typically managed by peer-to-peer (P2P) networks providing the support and substrate to the so-called distributed ledger (DLT), a replicated, shared, and synchronized data structure, geographically spread across multiple nodes. The Bitcoin (BTC) blockchain is by far the most well known DLT, used to record transactions among peers, based on the BTC digital currency. In this paper, we focus on the network side of the BTC P2P network, analyzing its nodes from a purely network measurements-based approach. We present a BTC crawler able to discover and track the BTC P2P network through active measurements, and use it to analyze its main properties. Through the combined analysis of multiple snapshots of the BTC network as well as by using other publicly available data sources on the BTC network and DLT, we unveil the BTC P2P network, locate its active nodes, study their performance, and track the evolution of the network over the past two years. Among other relevant findings, we show that (i) the size of the BTC network has remained almost constant during the last 12 months - since the major BTC price drop in early 2018, (ii) most of the BTC P2P network resides in US and EU countries, and (iii) despite this western network locality, most of the mining activity and corresponding revenue is controlled by major mining pools located in China. By additionally analyzing the distribution of BTC coins among independent BTC entities (i.e., single BTC addresses or groups of BTC addresses controlled by the same actor), we also conclude that (iv) BTC is very far from being the decentralized and uncontrolled system it is so much advertised to be, with only 4.5% of all the BTC entities holding about 85% of all circulating BTC coins.
With the recent popularity of Blockchain and other Distributed Ledger Technologies (DLT), blockchain enabled smart contract applications has attracted increased research focus. However, the immutability of the blocks, where the smart contracts are stored, causes conflicts with the traditional Software Development Life Cycle (SDLC) models usually followed by software engineers. This clearly shows the unsuitability of the application of SDLC in designing blockchain enabled smart contract based applications. This research article addresses this current problem by first exploring the six traditional SDLC models, clearly identifying the conflicts in a table with the application of smart contracts and advocates that there is an urgent need to develop new standard model(s) to address the arising issues. The concept of both block immutability and contract is introduced. This is further set in a historical context from legacy smart contracts and blockchain enabled smart contracts extending to the difference between "shallow smart contracts" and "deep smart contracts". To conclude, the traditional SDLC models are unsuitable for blockchain enabled smart contract-based applications.
The Shariʿa Law has a comprehensive vision of all human activities, including commerce. The peculiarities of the commercial legal system that derives from the legal principles of Shariʿa emanates from the concepts of forbidden or Haram and permissible or Halal. These principles are applied today to breakthrough commercial developments such as the Blockchain/Digital Ledger Technologies. On the other hand, there is a growing debate about the possibility of the application of Shariʿa Law in the Member States of the European Union, either for social reasons or for commercial reasons. The controversy and opportunities created in the smallest State of the Union, Malta, serves as a sample.
A decade long thrive of cryptocurrency has shown its potential as a source of alternative-finance and the security and the robustness of the underpinning blockchain technology. However, most cryptocurrencies fail to show inimitability and their meanings in the real world. As a result, they usually start off as favourites but quickly become the outcasts of the digital asset market. The blockchain society attempts to anchor the value of cryp-tocurrency with real values by employing smart contracts and link it with computation resources and the digital-productivity that have value and demands in the real world. But their attempts have some undesirable effects due to a limited number of practical applications. This limitation is caused by the dilemma between high performance and decentralisation (universal join-ability). The emerging of blockchain sharding models, however, has offered a possible solution to address this dilemma. In this paper, we explore a financial model for blockchain sharding that will build an active link between the value of cryptocurrency and computation resources as well as the market and labour behaviours. Our model can adjust the price of resources and the compensation for maintaining a system based on those behaviours. We anchor the value of cryptocurrency by the amount of computation resources participated in and give the cryptocurrency a meaning as the exchange between computation resources globally. Finally, we present a working example which, through financial regularities, regulates the behaviour of anonymous participants, also incents/discourages participation dynamically.
Purpose This paper aims to examine the risks associated with smart contracts, a disruptive financial technology (FinTech) innovation, and assesses how in the future they could threaten the integrity of the global financial system. Design/methodology/approach A qualitative approach is used to identify risk factors related to the use of new financial innovations, by examining how over-the-counter (OTC) derivatives contributed to the Global Financial Crisis (GFC) which occurred during 2007 and 2008. Based on this analysis, the potential for similar concerns with smart contracts are evaluated, drawing on the failure of The DAO on the Ethereum blockchain, which involved the loss of over $60m of digital currency. Findings Extensive use of bilateral agreements, complexity and lack of standardization, lack of transparency, misuse and speed of contagion were factors that contributed to the GFC that could also become material concerns for smart contract technology as its adoption grows. These concerns, combined with other contextual factors, such as the risk of defects in smart contracts and cyberattacks, could lead to potential destabilization of the broader financial system. Practical implications The paper’s findings provide insights to help make the design, management and monitoring of smart contract technology more robust. They also provide guidance for key stakeholders on proactive steps that can be taken with smart contract technology to avoid repeating the types of oversights that contributed to the GFC. Originality/value This paper draws attention to the risks associated with the adoption of disruptive FinTech. It also suggests steps that regulators and other key stakeholders can take to help mitigate those risks.
Being a decentralized system makes Blockchain a suitable technology solution in many cases. The Smart Energy domain has the potential to benefit from the use of Blockchain, by improving data and transaction management, through applications such as peer-to-peer energy trading, grid enhancement, and electric vehicle support. Many researchers have proposed models and prototypes of blockchain-based applications, which are expected to improve the performance of smart energy systems. In this report, a qualitative literature review was performed to look into a sample of these application proposals and to try to identify the impacts of blockchain technology in Smart Energy. This resulted in the discovery of both positive and negative factors. The beneficial factors include increased security, improved data privacy, data transparency and immutability, removal of third-party control and trust, ubiquitous solution, and greater data accessibility. The list of challenges includes limited scalability and speed, off-chain support requirement, high establishment and maintenance cost, and requiring further practical tests. One of the interesting findings is that the impact of Blockchain technology as to whether it may increase or decrease transaction costs is still unclear. Finally, the paper recommends that a future study may focus on economic feasibility and transaction costs, and ascertain which Smart Energy cases and application designs are more appropriate for Blockchain technology.
Venkata Marella, Bikesh Raj Upreti, Jani Merikivi, Virpi Kristiina Tuunainen
Abstract Contemporary cryptocurrencies lack legal, monetary, and institutional backing that traditional financial services employ. Instead, cryptocurrencies provide trust through technology. Despite the plethora of research in both trust and cryptocurrencies, the underlying attributes of the technologies that drive trust in cryptocurrencies are not well understood. To uncover these attributes, we analyze the corpus of 1.97 million discussion posts related to Bitcoin, the oldest and most widely used cryptocurrency. Based on earlier research, we identified functionality, reliability, and helpfulness as the focal constructs with which to evaluate users’ trust in technology. In our analysis, we discovered 11 different attributes related to three technology constructs that are significant in creating and maintaining users’ trust in Bitcoin. The findings are discussed in detail in the article.
Amid pressing demands to tackle critical sustainable development goals, governments in developing countries face the additional complex task of embracing new digital technologies such as blockchains. This paper takes a conceptual approach and presents a framework that interlinks development, technology, and governments while highlighting the relevance of state capacity and democratic governance in such dynamics. With this in hand, blockchain technology is revisited from the perspective of governments in the Global South, identifying in the process key traits and presenting a new typology. Research gaps regarding the relationship between this technology and both development and developing country government are also identified. A closer look at some on the ground blockchain implementations yields some early evidence on the advantages and risks involved in the process. The paper closes with a discussion of the results within the proposed framework suggesting additional research themes. It also provides some basic guidance for development practitioners interested in enhancing current programs using blockchains as an enabler.
Money’s materiality produces an ontological conundrum for social theory: should the analysis of money foreground the objects used as money, or the abstract relations that underpin it? Provoked by the emergence of cryptocurrencies, this paper develops a conceptualization of money as a technological and social infrastructure which directly addresses this theoretical impasse. Cryptocurrencies’ sole form of material existence coincides with their underpinning infrastructure of records, accounting and payments. In the past decade, cryptocurrencies have skyrocketed in number, and they have been applied to a host of use cases. This paper focuses on cross-border payments through the example of the fintech company Ripple, the cryptocurrency XRP, and the design of the XRP Ledger. Combining literatures from the social theory of money, science and technology studies and new materialisms, this article develops steps towards an ecological conceptualization of money infrastructures. Infrastructures, understood ecologically, include devices, active forms, and imaginaries in seamless webs of mutual relations of co-evolution. These ecologies are always potentially prone to slippage, dissolution, disassembling, reassembling and reappropriation, dependence, and competition.
Marco Valeri, Rosario Fondacaro, Cinzia De Angelis, Andrea Barella
This paper aims to evaluate where the application of new fintech solutions like blockchain and cryptocurrencies can be considered as an opportunity to build bridges between Islamic and western culture in order to create a trusted money transfer with low commission and a big transparency and trust. The research question is: Can an Hawala systems based on DLT technologies be considered compliant both with anti-money laundry regulations and with Sharia values? This is a conceptual paper relying upon an understanding of the literature in the fields of technology, sociology, anthropology, criminology and regulatory, as applied to the topic of Islamic practice known as Hawala and emerging new disruptive technologies like Distributed Ledger Technology. The research has been conducted by a literature reviewing on Scopus data base by searching the following keywords: Islamic finance, cryptocurrencies, hawala, stablecoin, globalcoin, money laundering, blockchain. The searching period was set on the last 10 years. The paper discusses some scenarios to define new fintech Hawala system in an evolving scenario of cryptocurrencies, social network commitments and different type of blockchain where it can be digitally transformed by using new fintech technologies while became compliance with anti-money laundering regulations with the respect of Islamic values. As practical implications, this paper could help to encourage researcher and entrepreneurs to evaluate and propose a digital transformation approach with the aim to maintain ancient tradition and, at the same time, apply new technology that improve the life of citizens. As social implications this paper expands upon the understanding of how new fintech solution can be easily be integrated in the real life by using common devices like a mobile phone to be used as wallet for the daily expenses and to receive money from relatives from western countries. The originality/value of this paper is that it covers the literature gap in the field of new fintech solutions applied to Islamic finance by providing a likely proposal by integrating popular tradition, regulations and new technologies. The research limitations and implications are related to that this is a conceptual paper; case studies haven’t been treated, so it is not able to say definitively if the outcomes discussed can be defined as an effective solution and can be developed in the real global society, in a future prospective it’ll be possible to continue to make researches in this field of application with fintech technologies and Islamic Finance.
Blockchain as a novel technology has shown the capacity to transform multiple sectors. Due to opportunities such as data security, transparency, privacy and interoperability presented by decentralized applications on blockchain networks, organizations are now moving their inter-organizational functions to blockchain-based systems. Traditional system-design methods are not suitable for developing blockchain systems since they are not capable of capturing new functions that are associated with decentralized applications. This paper seeks to address this gap by exploring existing design methods and frameworks that support the development of decentralized application on a blockchain. To achieve this, case-study based research is used in identifying current software-development techniques used in designing decentralized applications (DApp). Experts in this field are interviewed to identify their chosen techniques for designing and developing block-chain applications. Furthermore, related literature is selected to identify current techniques for DApp-designs based on the state of the art. A systematic analysis of the identified techniques is conducted using the current limitations of blockchain technology as criteria for the analyses. Finally, based on the findings of this study, we propose a new model-driven framework for designing blockchain applications.