Abstract We make a distinction between centralized, decentralized, and distributed payment mechanisms. A centralized payment mechanism processes a transaction using a trusted third party. A decentralized payment mechanism processes a transaction between the parties to the transaction. A distributed payment mechanism relies on the network of users to process a transaction on a shared ledger. We maintain that bitcoin is neither a centralized nor a decentralized payment mechanism. It is, instead, a distributed payment mechanism. We then consider decentralized and centralized aspects of the broader bitcoin payment space.
The modern financial technology (“FinTech”) revolution has two features that distinguish it from previous eras of innovation: (1) Consumers have greater access to financial information and applications using smartphones on high-speed networks; and (2) businesses benefit from dramatically lower costs, improved performance, and enhanced options in data storage, computation, and application development. The once monolithic and proprietary financial services industry is being challenged under the zeitgeist of decentralization, disintermediation, and open protocols. Consequently, households in the United States are witnessing the emergence of new options for investment, credit, insurance, and payments. We illustrate how several influential FinTech trends may help address biases and constraints that hamper households in smoothing intertemporal consumption.
Education plays a vital role in human life. To encourage higher education, the Indian government has taken many initiatives. These include the disbursement of scholarships to financially help the students belonging to low-income families. Central Sector Scheme of Scholarship for College and University Students (CSS) is one such scheme that financially helps meritorious students in pursuing graduation and post-graduation. This scheme was introduced in 2008. Scholarships from CSS have been helping students to fund their educational expenses. But there have been some difficulties faced by the students in availing this scholarship. These include lack of traceability of application form, loss of application form in transit through Indian Postal Service, lack of transparency between students and their respective Education Boards, and lack of bank account verification. In this paper, we propose a Smart Contract for CSS Scheme that overcomes the above-mentioned drawbacks. It has four entities: Students, Education Boards, Colleges, and Banks. The Blockchain-based Smart Contract proposed in this paper, has been developed to provide a user-friendly environment to a student and maintain a transparent and constant connection between students and their respective Education Boards. Many applications have been developed on the Blockchain platform but to the best of our knowledge, there does not exists any government scholarship scheme on the Blockchain platform in India.
The main quality of a smart contract relies on the automation of contractual relationships, as the performance is triggered by an algorithm in turn triggered by the fulfilment of certain events. Most of the benefits arising from smart contracts are based on the ‘self-executing’ and ‘self-enforcing’ character, which represent a source of innovation for general contract law. Smart contracts use blockchain to ensure the transparency of the contractual relationship and to create trust in the capacity to execute the contract, which depends on the technology used. The aim of the present essay is to investigate whether and how blockchain technology platforms and smart contracts could be considered a modern form of private authority, which at least partially escapes the application of mandatory rules and traditional enforcement mechanisms. In particular, the authors will devote attention to innovative self-help mechanisms and dispute resolution systems, which can be depicted as ‘alternative’ insofar as they present themselves as independent from courts and other national state authorities.
Blockchain helps to deliver Computerized working, on spot verification, cost efficiency, enhanced work. One of the fast initiatives for the implementation of Blockchain is taken by financial sector. As more than 60% of the market percent of the market value focuses on new technology. In the coming time, blockchain will start into influence into many domain including accountancy on it auxiliaries. Smart contract can play a very important role in banking and insurance. This can be very vital tool for the auditing purpose, because all transactions can be updated without any third party interference. All the accounting standards can be evaluated through blockchain systems thus giving professional accountants such as Chartered Accountants and Certified Public Accountants to focus more on the company policies and how it can improve its operations ethically. To access any resource in blockchain network. This paper presents a framework which use Fair access using Dynamic Access control. All process of fair access is recorded in smart contract and token allocation can be done with the help of Digital Signature. This makes system more perfect. For the very purpose of Blockchain intervening into accounting policies is to ensure that auditors are working to the potential in terms of verifying the accounts and financial records in accordance to the International Accounting Standards. This step hopes to minimize minimal frauds that might happen in the workplaces which could halt to the end of the business life as the privacy of smart contract can be enhanced.
Die technologische Grundlage für Bitcoin & Co, Initial Coin oder Token offerings, nämlich die Blockchain-Technologie, weist enormes Potenzial auch für Emissionen von Wertrechten am Kapitalmarkt auf. Insbesondere der Einsatz der Blockchain-Technologie und das dahinterstehende Konzept eines verteilten Registers – die Distributed Ledger Technology (DLT) zur Digitalisierung von Wertpapieren wird als einer der wichtigsten Anwendungsbereiche erachtet. Dabei soll eine gänzliche Transformation von Wertpapieren zu den durch eine Registereintragung geschaffenen und übertragbaren Wertrechten stattfinden. Das Vertrauen in zentrale Akteure wird durch das Vertrauen in ein Netzwerk ersetzt, das auf gemeinsame Regeln und Konsens basiert („Code of Law“). Auf diese Weise werden Transaktionen zwischen Individuen ermöglicht, welche nicht durch Dritte beeinflusst, aber trotzdem je nach der jeweiligen Konzipierung von Dritten im gewünschten Maß kontrolliert werden. Im gegenständlichen Aufsatz wird das Hauptaugenmerk auf die rechtlichen und technischen Anforderungen an ein solches Wertrechteregister und an die registerführende Stelle gelegt sowie die integrierten Bestandteile einer Blockchain, wie etwa Hashwerte, die Verteilung des Registers auf mehrere Teilnehmer und die Mechanismen zur Authentifizierung von Transaktionen erörtert. Die Schaffung von gesetzlichen Rahmenbedingungen für die Digitalisierung des Kapitalmarkts ist ein europaweites Phänomen. Dabei nehmen Liechtenstein und die Schweiz eine Vorreiterrolle ein und haben bereits Gesetzesvorhaben veröffentlicht, wobei das liechtensteinische Blockchain-Gesetz umfassende Rahmenbedingungen für Blockchain-Produkte vorsieht. Auch der deutsche Gesetzgeber hat seine Absichten zur Schaffung einer elektronischen Schuldverschreibung in einem Eckpunktepapier des BMJV und des BMF dargelegt. Darüber hinaus verabschiedete der Deutsche Bundestag am 29.11.2019 mit dem geplanten Gesetz zur Umsetzung der neuen EU-Geldwäscherichtlinie einen Gesetzentwurf, der Banken das Angebot und die Verwahrung von Kryptowährungen erlauben soll. Auch das französische Parlament hat am 11.04.2019 den Aktionsplan PACTE verabschiedet, der eine freiwillige Zertifizierung sowohl für die Herausgabe als auch für den Handel mit Kryptowährungen durch die französische Marktaufsichtsbehörde vorsieht. Zuletzt gehen die Bemühungen des österreichischen Gesetzgebers durch die Einsetzung einer Untergruppe des FinTech Beirats in die gänzliche Transformation von Wertpapieren zu Wertrechten. Ziel dieses Aufsatzes ist nicht die Entwicklung des Wertpapierrechts iSd Dematerialisierung von Wertpapieren darzustellen oder für einen gänzlichen Umstieg auf Wertrechten zu plädieren; vielmehr werden Wertrechte vorausgesetzt und deren digitale Emission behandelt. In dem Aufsatz über „die Schaffung und übertragung von Wertrechten via Blockchain-Technologie“ wurde bereits das Erfordernis einer positivrechtlichen Verankerung als Sache iSd § 285 ABGB von Wertrechten thematisiert, damit die sachenrechtlichen Grundsätze auch bei Wertrechten angewendet werden können.
Ariah Klages‐Mundt, Dominik Harz, Lewis Gudgeon, Junyou Liu · 5 authors
Stablecoins are one of the most widely capitalized type of cryptocurrency. However, their risks vary significantly according to their design and are often poorly understood. We seek to provide a sound foundation for stablecoin theory, with a risk-based functional characterization of the economic structure of stablecoins. First, we match existing economic models to the disparate set of custodial systems. Next, we characterize the unique risks that emerge in non-custodial stablecoins and develop a model framework that unifies existing models from economics and computer science. We further discuss how this modeling framework is applicable to a wide array of cryptoeconomic systems, including cross-chain protocols, collateralized lending, and decentralized exchanges. These unique risks yield unanswered research questions that will form the crux of research in decentralized finance going forward.
Advancements in the digital domain, for example in blockchain technology, big data and machine learning, are increasingly shaping the lives of individuals, groups, organizations, and societies. These developments call for effective governance to protect the basic interests and needs of these actors. Simultaneously, the very nature of governance is also changing. Policy-making is increasingly moving away from top-down governance by the state towards more horizontal modes of governance. This paper reviews the literature on governance theory in order to conceptualize governance as a mode of decentralized, networked regulation. We argue that the current dominant modes of governance are inadequate in understanding governance in the digital domain, and are poorly equipped to conceptualize novel forms of governance such as decentralized autonomous organizations (DAOs). Therefore, this study proposes a new mode of governance based on the regulation of new power relationships between the state and actors in the digital domain. This model further explores the role that blockchain technology can play in what we term decentralized network governance.
The progress of ICT technologies, day-ahead forecast, home energy management systems, implementation of smart meters, and Distributed Energy Sources (DER) enables new business opportunities for prosumers to locally trade the surplus via blockchain platforms leading to considerable advantages at the community level. The current research handles settlement similar to a centralized market that it is not necessarily the best solution for blockchain. Nonetheless, the settlement is essential as sellers and buyers perceive the attractiveness of the local trading through the market results. In this paper, we propose two novel and efficient settlement mechanisms (Global Balancing Settlement GBS and Splitting Settlement SS) for Peer-to-Peer (P2P) electricity exchange enhancing the performance of the classic Pairwise Settlement PS. These will be written as stored procedures embedded into the smart contracts along with auctioning procedures. The simulations are performed using a small residential community with 30% of the electricity that can be locally traded to lower the bills and unstress the public grid. The performance of the two proposed settlement methods is proved by the 14 scenarios that thoroughly indicate that GBS and SS provide better results for both sellers and buyers than PS. In the reference scenario, with GBS, sellers have the highest encashments with almost 4% more, whereas buyers encounter the lowest payments with almost 5% less than in case of the classic settlement. Starting from reference scenario, alternative scenarios are envisioned to extend the analyses and assess the performance of the settlement mechanisms. The highest gain is recorded with GBS mechanism: almost 8.8% for sellers and 6.5% for buyers. Another interesting outcome is that GBS is providing better results than SS. When deviations are small, SS provides almost 6% gain for both sellers and buyers, but when they increase, the gain is exceedingly small or none.
More than eight million smart contracts have been deployed into Ethereum, which is the most popular blockchain that supports smart contract. However, less than 1% of deployed smart contracts are open-source, and it is difficult for users to understand the functionality and internal mechanism of those closed-source contracts. Although a few decompilers for smart contracts have been recently proposed, it is still not easy for users to grasp the semantic information of the contract, not to mention the potential misleading due to decompilation errors. In this paper, we propose the first system named STAN to generate descriptions for the bytecodes of smart contracts to help users comprehend them. In particular, for each interface in a smart contract, STAN can generate four categories of descriptions, including functionality description, usage description, behavior description, and payment description, by leveraging symbolic execution and NLP (Natural Language Processing) techniques. Extensive experiments show that STAN can generate adequate, accurate, and readable descriptions for contract's bytecodes, which have practical value for users.
Purpose: The paper aims to review the academic research work done in the area of Islamic financial technology. The Islamic FinTech area has been classified into three broad categories of the Islamic FinTech, Islamic Financial technology opportunities and challenges, Cryptocurrency/Blockchain sharia compliance and law/regulation. Finally, the study identifies and highlights the opportunities and challenges that Islamic Financial institutions can learn from the conventional FinTech organization across the world. Approach/Methodology/Design: The study collected 133 research studies (50 from Social Science Research Network (SSRN), 30 from Research gate, 33 from Google Scholar and 20 from other sources) in the area of Islamic Financial Technology. The study presents the systematic review of the above studies. Findings: The study classifies the Islamic FinTech into three broad categories namely, Islamic FinTech opportunities and challenges, Cryptocurrency/Blockchain sharia compliance and law/regulation. The study identifies that the sharia compliance related to the cryptocurrency/Blockchain is the biggest challenge which Islamic FinTech organizations are facing. During our review we also find that Islamic FinTech organizations are to be considered as partners by the Islamic Financial Institutions (IFI’s) than the competitors. If Islamic Financial institutions want to increase efficiency, transparency and customer satisfaction they have to adopt FinTech and become partners with the FinTech companies. Practical Implications: The study will contribute positively to the understanding of Islamic Fintech for the academia, industry, regulators, investors and other FinTech users. Originality/Value: The study believes to contribute positively to understanding of Fintech based technology like cryptocurrency/Blockchain from sharia perspective.
Mohammad Madine, Ammar Battah, Ibrar Yaqoob, Khaled Salah · 8 authors
Personal health records (PHRs) are valuable assets to individuals because they enable them to integrate and manage their medical data. A PHR is an electronic application through which patients can manage their health information. Giving patients control over their medical data offers an advantageous realignment of the doctor-patient dynamic. However, today's PHR management systems fall short of giving reliable, traceable, trustful, and secure patients control over their medical data, which poses serious threats to their authenticity and accuracy. Moreover, most of the current approaches and systems leveraged for managing PHR are centralized that not only make medical data sharing difficult but also poses a risk of single point of failure problem. In this paper, we propose Ethereum blockchain-based smart contracts to give patients control over their data in a manner that is decentralized, immutable, transparent, traceable, trustful, and secure. The proposed system employs decentralized storage of interplanetary file systems (IPFS), proxy re-encryption, and trusted reputation-based oracles to securely fetch, store, and share patients' medical data. We present algorithms along with their full implementation details. We evaluate the proposed smart contracts using two important performance metrics, such as cost and correctness. Furthermore, we provide security analysis and discuss the generalization aspects of our solution. We outline the limitations of the proposed approach. We make the smart contract source code publicly available on Github.
Being the most popular permissionless blockchain that supports smart contracts, Ethereum allows any user to create accounts on it. However, not all accounts matter. For example, the accounts due to attacks can be removed. In this paper, we conduct the first investigation on erasable accounts that can be removed to save system resources and even users' money (i.e., ETH or gas). In particular, we propose and develop a novel tool named GLASER, which analyzes the State DataBase of Ethereum to discover five kinds of erasable accounts. The experimental results show that GLASER can accurately reveal 508,482 erasable accounts and these accounts lead to users wasting more than 106 million dollars. GLASER can help stop further economic loss caused by these detected accounts. Moreover, GLASER characterizes the attacks/behaviors related to detected erasable accounts through graph analysis.
Blockchain technology has been an essential aspect for research due to its, peer to peer nature, distributed nature, and decentralization, some of its applications are Supply chain, Healthcare System, Real state, etc. Ethereum is a distributed public blockchain network that focuses on running the code of any decentralized application. A smart contract is a computer program having self-verifying, self-executing, tamper-resistant properties. Initial Coin Offering (ICO) is a process similar to crowdfunding, in which companies raise funds from investors, who, in exchange receive tokens or digital assets. This paper deals by explaining the proposed model, different functions of ERC20 standard, the different tasks performed by each function and implementing various functionalities of ERC20 Token in Solidity.
We document ongoing research on a digital artefact comprising a settlement layer for financial contracts traded over the counter (OTC). Working with a team of stakeholders from a hosting organization we employ the design science research methodology (DSR) in the design, implementation and evaluation of a DLT based settlement layer for OTC contracts. Our findings indicate that DLT may serve towards reducing execution costs while mitigating counterparty credit risk through deterministic automation of key processes in the OTC contract lifecycle. Extrapolating these early results, we introduce three general propositions on the systemic and commercial implications of DLT. We contribute to the broader IS discourse on the capacity for emerging digital technologies to upend traditional knowledge processes in the financial services.
In about a decade of its existence, blockchain technology has seen some level of innovation diffusion to many sectors other than its genesis application of cryptocurrencies (see Figure 4-1). This chapter presents an objective view of the developments of blockchain and distributed ledger technologies beyond the cryptocurrencies. By drawing from the current states of the tech, I will present a detailed analysis of existing and potential use cases including ecommerce, Vickrey auction, self-sovereign digital identity management, and vital statistics recording. The chapter further lends key points to consider for applying blockchain and distributed ledger technologies in businesses. Here, starting from justifying why blockchain is a potential solution concept for a business, I will cover points such as asset digitization, participants identification and the degrees of permission, tokenization, decentralized applications, smart contracts and robust consensus algorithm, scalability of data throughput, payment channels, as well as a business model development for token sales.