The world experienced unprecedented growth in international trade in the past few decades. In this resulting environment of global competition, several new companies have spawned and are spawning. Sellers are often under immense pressure by the market players to accept open-account trade terms, shipping goods before receiving payment, leaving them exposed to increased risk. This creates working capital challenges for firms, especially small and medium enterprises. To mitigate this supply chain risk, several supplier-led and buyer-led supply chain finance solutions are facilitated by banks and financial technology companies. However, because of the new Basel III regulation framework for banks and several other Supply Chain Finance (SCF) adoption barriers, like fraudulent activities, many firms are unable to reap SCF’s full benefits. This study explains various SCF instruments, the key drivers in their growth and their adoption barriers. This study then focuses on the novel blockchain technology and smart contracts by delving deep into their history, components, limitations, risks and use cases. Using the knowledge gathered in the process, a proof-of-concept blockchain and smart contract is developed using the Ethereum platform, which can facilitate normal business, purchase order finance, reverse factoring and reverse securitization. To test the smart contract, four use cases for each SCF instrument mentioned are demonstrated. A JavaScript-based unit test is done to test the smart contract’s correct deployment and onboarding of actors along with their business and financing interactions – access controls to business documents, reverting malicious transactions and correct fund transfer. As a result of various assumptions taken in the development process, the smart contract works only as a basic proof-of-concept and lacks robustness on the ground of scalability and security. As a result, a future model is laid out which will use various software and hardware oracles for autonomous operations while using a complex system of a storage contract, a permanent contract which stores all the data, and logic contract, upgradable contract which can be changed any number of times, with a proxy contract making delegated “function” calls to logic contract to reduce the gas usage due to external function calls.
There is broad consensus among international regulators and practitioners that Crypto Assets as an emerging new asset class and related Distributed Ledger/Blockchain Technology (DLT) will have an immense potential for innovation end efficiency gains in the financial sector. Crypto Assets and tokenisation might revolutionise the financial markets in similar ways as securitisation in the past. Considering that, in view of the finance industry forging ahead, the EU Commission has taken up the subject by the initiation of formal proceedings, time has come to attempt an overarching analysis of the current state. So far it seems that academics and practitioners have focused primarily on the regulatory aspects of Crypto Assets. Nevertheless, the outcome of the private law analysis might well have a major impact on the stance of international regulators towards the subject matter, which, apart from AML and fraud combating, is driven by considerations in respect of financial stability and investors’ protection. There is no doubt that significant risks and legal uncertainties are involved in both private and regulatory law. The overarching question is whether the national and international legal systems - private and public law - are prepared to ensure legal certainty and appropriate protection of market participants as well as of the public good without hindering innovation. The key questions to be answered are as follows: Can a Crypto Asset be classified as property? What is the legal status of the Distributed Ledger/Blockchain: is it a register or at least a means of documentary evidence? Which are the legal formalities for the transfer of Crypto Assets? Are they backed by legal recognition? Until to-date, the results differ between individual jurisdictions. This is why individual national legislators have taken up the subject with Liechtenstein and Switzerland leading the way. The EU itself and Member Countries will have to master these challenges to position themselves as an attractive location through legal certainty, efficient regulation and good reputation in the field. The EU Commission has initiated formal proceedings - related proposals are expected to be published in Q 3 2020.
In recent years, the rapid development of blockchain technologies have attracted worldwide attention. Its application has been extended to many fields, such as digital finance, supply chain management, and digital asset transactions. For some enterprises and users, how to choose the most effective platform from many blockchains to control costs and share data is an important issue. To comprehensively evaluate the blockchain technologies, we first construct three-level evaluation indicators in terms of technical, market, and popularity indicators. Then, we propose an improved global DEA-Malmquist index without explicit inputs to assess the dynamic performance of blockchain technologies. Finally, we carry out an empirical analysis to evaluate 31 public blockchains' performance from May 2018 to April 2020. The results indicate that the overall performance of blockchain technologies is basically on the rise. Some blockchain technologies that have not yet received widespread attention have shown good dynamic performance.
This article overviews the history of the Japanese cryptocurrency market, which is closely connected to fraud and hacking into the Japanese exchange. It is scientifically based, Japan was proved to be developing the legal basis for successfully developing cryptoindustry. Moreover, a new national cryptocurrency, closely linked to yen, is going to be released in the middle of 2020. This approach allows Japan to become the centre of the cryptocurrency exchange and the leader in the international cryptocurrency mechanism.
Digital currencies using distributed ledgers can be a digitized version of currency while retaining its four major features: (1) anonymity, (2) peer-to-peer (P2P) exchangeability, (3) universality, and (4) a steady titular value. There is a variety of potential solutions (formats) that can be adopted depending on the attributes and impact of each format on the financial system. This chapter characterizes and examines the benefits, opportunities, costs, and challenges of four key formats, and gives its assessment on the feasibility as well as possibility of practical adoption. Finally, it recommends the adoption of a CBDC (non-universal) for the interbank settlement and wholesale payment systems which has a minimal disruption to the economy, stronger monetary policy transmission and suggests way forward for adoption of an interest-free monetary system.
Sharing the electronic health data helps to increase the accuracy of the diagnoses and to improve the quality of health services. This shared data can also be used in medical research and can reduce medical costs. However, health data are fragmented across decentralized hospitals, this prevents data sharing and puts patients’ privacy at risks. In recent years, blockchain has revealed solutions that make life easier in many areas thanks to its distributed, safe and immutable structure. There are many blockchain-based studies in the literature on providing data privacy and sharing in different areas. In some studies, blockchain has been used with technologies such as cloud computing and cryptology. In the field of healthcare blockchain-based solutions are offered for the management and sharing of Electronic health records. In these solutions, private and consortium blockchain types are generally preferred and Public Key Infrastructure (PKI) and encryption are used for data privacy. Within the scope of this study, blockchain-based studies on the privacy preserving data sharing of health data were examined. In this paper, information about the studies in the literature and potential issues that can be studied in the future were discussed. In addition, information about current blockchain technologies such as smart contracts and PKI is also given.
The popularity and emergence of digital currency can be attributed to social media as it has a large user base for online discussion. The crypto market is highly dependent on socially constructed opinions as investors rely on online sources to acquire related information. A headline is considered as a summary of an article in a single sentence as it is the first that can gain a reader’s attention. The objective of this paper is to analyze the trend of cryptocurrency headlines in terms of positive and negative sentiment. The dataset is obtained from the Kaggle webpage containing news headlines from five online platforms. The paper will be using a lexicon-based sentiment approach to identify the binary sentiment. Support Vector Machine algorithm will be used to evaluate and optimize the sentiment results. This paper contributes to the gap in the literature by providing an empirical analysis of overview changes of the cryptocurrencies with multiple news platforms and longer periods. The findings of the paper resulting in negative sentiment for the trend of headlines, but it showed a different view in terms of positive polarity. Furthermore, the TD-IDF model outperformed the sentiment model in SVM modeling. Keywords: Cryptocurrency, Sentiment analysis, Lexicon sentiment, Natural Language Processing (NLP), Support Vector Machine (SVM).
Київський національний економічний університет імені Вадима Гетьмана, Михайло ОРЄХОВ, Т.В. Орєхова, Донецький національний університет імені Василя Стуса
The paper analyzes the role of digital currencies in the global financial system, the peculiarities of their use. The paper pays attention to the characteristics of the historical preconditions for the emergence of electronic payments and, as a consequence, digital currencies. The paper analyzes the features of the emergence and functioning of major global cryptocurrencies - Bitcoin, Ripple and Ethereum. The advantages of cryptocurrencies, the authors of the study include unlimited opportunities for transactions, no borders, transaction speed. Among the disadvantages of cryptocurrencies is the lack of a proper level of knowledge, which leads to the spread of fraud. The paper presents the volume and share of bitcoin trade in different markets during the period from January 2013 to January 2018. The results of the study allow us to conclude that the modern cryptocurrency market, despite the fact that the evolution of electronic money is in its infancy, and cash is still the most important form of payment for retail transactions, is highly competitive and fragmented.
Md Sakibul Islam, Fahmid Shahriar Iqbal, Muhaimenul Islam
Registration process regarding ownership, possession or other rights for properties like land is a tedious method in progressing countries like Bangladesh. This paper highlights issues related to manual land registrations processes such as transparency, centralization, authenticity, reliability, etc and proposes a better method to overcome these problems using Blockchain Technology. The comparison between Blockchain-based digital land record systems in different countries is also explored in this paper. Finally, we have developed a novel framework that uses Blockchain method for executing the process of Land Registration and providing authentic and indisputable rights on ownership for the people in Bangladesh.
PurposeThis study presents research on the awareness and aspirations of millennials towards different investment asset classes with a special focus on cryptocurrencies. Cryptocurrencies are technology dependent digital money systems which have created a buzz in the financial markets in a very short period of time. Digital currencies like Bitcoin, Ethereum, Ripple, Bitcoin Cash, etc., are considered as a new investment asset category that seems to be associated with high risk and return. There are a number of advantages and disadvantages associated with them, but countries, like Japan and the US, have accepted them for some types of transaction, however, India, one of the five largest emerging economies of 2018, has still not accepted them. In spite of government and regulatory inertia towards cryptocurrencies, we have found that awareness and aspiration to invest in this category among millennials is increasing. The objective of this paper is to understand the investment attitudes of millennial investors towards the desire to invest in cryptocurrencies given the disposition of this generation towards the digital world and technologies.Study designThis study is conducted in Mumbai to assess the interest levels in this category especially among the millennial generation. This is a primary research study and data has been collected via face-to-face interviews, and a structured questionnaire, with suitable open-ended questions, involving 100 millennial retail investors in Mumbai, and a random sampling method. The participants were aware of the risk level of the selected financial products. Descriptive statistics and advance analysis techniques, such as correlation, factor and multiple regression analysis, were used as tools to describe relationships in the investment category, to decipher the pattern of the decision-making process among millennials with respect to investment in different categories of financial products.FindingsThe underlying motivation for any financial investment is growth and appreciation of value at an expected rate of return. It is this motivation that needs to be managed by any financial planner, and this is the foundational finding of our research with respect to cryptocurrencies. This study provides information to regulators, recommending adoption of cryptocurrencies within a regulated structure in India.LimitationsThis study has been conducted in Mumbai only.ImplicationsThe fundamental objective of any investment is a positive return and that positive return has to be well managed by governments, regulators and financial marketers.ContributionThis study presents new evidence given the changes that have occurred recently in the financial markets and also highlights the variables that could be determining factors of risk appetite/tolerance for millennial retail investors. It clearly highlights that financial literacy and maturity of millennial investors will drive interest levels in a particular asset class. Prior knowledge about the level of diffusion and adoption of cryptocurrencies as a new asset among Indian millennials will help in creating a relevant policy framework. This will also help in creating a society-safety network among rising digital communities. This is a potentially transparent technological solution that can facilitate many financial solutions such as investments, remittances, and innovative ways to build financial inclusion in society.
An early stage funding platform using cryptocurrency smart contracts can potentially provide an equity and debt capital raising platform for new ventures compared to crowdfunding, initial coin offerings (ICOs) and seed funding. The existing capital raising methods are less transparent, have limited depth of funding and less diversification. Utilising a cryptocurrency smart contract-based early stage funding platform will allow new ventures to obtain a staged funding environment, starting from seed funding. Each stage of funding can be represented by a smart contract that is aligned to a formal standardised legally binding contract between the venture and investors through the platform. Competition for funds and a transparent smart contract-based platform should allow free markets to price investments in the new venture in a more efficient fashion. Additionally, such a platform should provide more funding opportunities to new ventures that weren't available prior.
This chapter presents the Web 3.0 economy with a primary focus on the network economies of blockchain technology and distributed ledger technologies (DLTs). It is designed to present a general overview of the Web 3.0 distributed network economy in light of some business, finance, and economic theories and practices. The chapter thus lucid the analyses to aid understanding the applications of economic thinking and design to the newly evolving digital economic system. The chapter provides a conceptual review of blockchain tech economics by organizing dispersed thoughts in the field.
The article presents blockchain technology for developing national digital economy, efficiency of digitalization and basic principles of digitalization, and a set of blocks requiring material resources. The purpose of the article is to study features of digital economy development and propose application of blockchain technology in national economy sphere. Research methods: The instrumental and methodical apparatus of research based on application, in framework of a systematic approach, general scientific research methods. Implementing blockchain technology in financial system at micro-macro degrees, insurance system, system of government, electron trade system, industrial system, intellectual property account system, education system, health care system was analyzed in this article. Organizing in perfect way the operations to implement the digital economy in Uzbekistan, and develop and establish large financial projects at the state level, moreover, illustrated in details importance of using blockchain technology in national economy industries while developing and establishing large financial projects at the state level.