Emission trading policy provides a new approach using economic incentives to control the environmental pollution efficiently. Legal polluters can trade emission permits with each other through a trusted trading system that lacks security and credibility due to its centralization nowadays. Permissioned blockchain utilize a decentralized way to store private data immutably, providing new approaches to solve those defects of the existing centralized systems. In this paper, we propose a Hyperledger-based Emission Trading System (HyperETS) on the permissioned blockchain. Using Hyperledger Fabric as the implementation platform, HyperETS integrates the fine-grained access control, distributed ledger, and consensus protocol, aiming to provide credible trading service for polluters. We achieve the business logic by designing the particular ledger structures and smart contract in blockchain. HyperETS stores all transactions immutably in a chain and makes it easy to share the data between organizations. Finally, several experiments are conducted to evaluate the performances of the proposed demonstration system.
Yuepeng Wang, Shuvendu K. Lahiri, Shuo Chen, Rong Pan · 7 authors
Ensuring correctness of smart contracts is paramount to ensuring trust in blockchain-based systems. This paper studies the safety and security of smart contracts in the \emph{Azure Blockchain Workbench}, an enterprise Blockchain-as-a-Service offering from Microsoft. As part of this study, we formalize \emph{semantic conformance} of smart contracts against a state machine model with access-control policy and develop a highly-automated formal verifier for Solidity that can produce proofs as well as counterexamples. We have applied our verifier {\sc VeriSol} to analyze {\it all} contracts shipped with the Azure Blockchain Workbench, which includes application samples as well as a governance contract for Proof of Authority (PoA). We have found previously unknown bugs in these published smart contracts. After fixing these bugs, {\sc VeriSol} was able to successfully perform full verification for all of these contracts.
Antonio Fernández Anta, Chryssis Georgiou, Nicolas Nicolaou
The various applications using Distributed Ledger Technologies (DLT) or blockchains, have led to the introduction of a new `marketplace' where multiple types of digital assets may be exchanged. As each blockchain is designed to support specific types of assets and transactions, and no blockchain will prevail, the need to perform interblockchain transactions is already pressing. In this work we examine the fundamental problem of interoperable and interconnected blockchains. In particular, we begin by introducing the Multi-Distributed Ledger Objects (MDLO), which is the result of aggregating multiple Distributed Ledger Objects -- DLO (a DLO is a formalization of the blockchain) and that supports append and get operations of records (e.g., transactions) in them from multiple clients concurrently. Next, we define the AtomicAppends problem, which emerges when the exchange of digital assets between multiple clients may involve appending records in more than one DLO. Specifically, AtomicAppend requires that either all records will be appended on the involved DLOs or none. We examine the solvability of this problem assuming rational and risk-averse clients that may fail by crashing, and under different client utility and append models, timing models, and client failure scenarios. We show that for some cases the existence of an intermediary is necessary for the problem solution. We propose the implementation of such intermediary over a specialized blockchain, we term Smart DLO (SDLO), and we show how this can be used to solve the AtomicAppends problem even in an asynchronous, client competitive environment, where all the clients may crash.
Purpose This paper aims to investigate the way in which blockchain technology is likely to influence future supply chain practices and policies. Design/methodology/approach A systematic review of both academic and practitioner literature was conducted. Multiple accounts of blockchain adoption within industry were also consulted to gain further insight. Findings While blockchain technologies remain in their infancy, they are gaining momentum within supply chains, trust being the predominant factor driving their adoption. The value of such technologies for supply chain management lies in four areas: extended visibility and traceability, supply chain digitalisation and disintermediation, improved data security and smart contracts. Several challenges and gaps in understanding and opportunities for further research are identified by this research. How a blockchain-enabled supply chain should be configured has also been explored from a design perspective. Research limitations/implications This systematic review focuses on the diffusion of blockchain technology within supply chains, and great care was taken in selecting search terms. However, the authors acknowledge that their choice of terms may have excluded certain blockchain articles from this review. Practical implications This paper offers valuable insight for supply chain practitioners into how blockchain technology has the potential to disrupt existing supply chain provisions as well as a number of challenges to its successful diffusion. Social implications The paper debates the poential social and economic impact brought by blockchain. Originality/value This paper is one of the first studies to examine the current state of blockchain diffusion within supply chains. It lays a firm foundation for future research.
Purposely modular, this protocol enables customization of several protocol properties, including the consensus properties implemented, blockchain type, the roots used, and virtual machine opcodes, among others. These modules enable implementing parties to control the behavior of their economy, with a minimal amount of effort, and no sacrifice in participant cryptoeconomic quality. This work also demonstrates the simplification of the developer experience by abstracting away all technological details, except basic CRUD-based operations, using various programming languages. We demonstrate the mechanism design approach taken, and formalize a process for deploying populations of blockchain economies at scale. The framework shown includes adequate tooling for simulation, development, deployment, maintenance, and analytic-based decision making. Lastly, we introduce an expressive programming language for the purpose of creating, and interacting with the cryptoeconomy designed by the implementing developer.
The research objective of the article: The aim of the paper is to present the challenges and opportunities of Initial Coin Offering (ICO) procedure (sometimes appearing in literature and official documents as the Initial Token Offering (ITO)) from the point of view of a company as well as verify the hypothesis about ICO as a cheap form of capital rising that is often presented in websites dedicated to ICO. There are enumerated the differences and similarities to the Initial Public Offering and possible advantages over other methods of capital rising. The paper points out the most important barriers to the use of ICO. The research method applied: As there is shortage of available research papers and literature related to the topic that are focused on financial aspects such as comparison between ICO and other methods of capital rising, there was conducted the analysis of reliable internet sources and a case study method of Ethereum – the first company that applied the Initial Coin Offering procedure. The mentioned research method has its limits, as it is necessary to verify received information. That is the reason why only professional websites dedicated to the topic were used. The outcome of the research (considerations, analyses), main conclusion(s): the Initial Coin Offering procedure is recognised as a very controversial topic. It is clearly visible that ICO has many advantages over traditional forms of rising capital for the company, but, so far, ambiguous legal status, cost level and high risk of scams and other possible abuses make it difficult to become widely applied by newly created companies.
The article presents an econometric analysis of the effect of stock indicators, such as Comex Gold futures, Dow Jones Industrial Average index and NASDAQ Composite, on the Ethereum cryptocurrency dynamics in the 100-day period. As part of the study, an econometric model of the dynamics of e-currency was built. The survey results show that when the Comex gold futures price changes by 1% on average, the Ethereum price changes by 5.01% in the same direction, when the Dow Jones Industrial Average index changes by 1%, the Ethereum price is 10.897%, and when the NASDAQ Composite index changes, the Ethereum price will change in the opposite direction to 3.59%
Blockchain is defined as a distributed ledger technology that can implement financial models. An improved blockchain provides a democratic virtual economic system (DVES) that can verify payments, reach consensus, and store encrypted data in virtual economic systems. In this paper, we review the latest progress and possibilities in improved blockchain with respect to openness, data security, and scalability. This paper outlines the challenges of value, existence, and status (VES) and the state-of-the-art solutions for improved blockchain. Then, this paper discusses the VES in terms of distributed energy, ownership certification, infrastructure, and other fields. More importantly, it analyzed the importance of scale out, which can be a key enabler to solve the main practical problems in constructing DVES.
Bitcoin was the first digital currency to rely on a decentralized peer-to-peer network instead of a trusted third party. This was achieved through Bitcoin’s revolutionary underlying technology based on cryptographic proof: the blockchain. After Bitcoin’s emergence, many other so called cryptocurrencies entered the market and we have seen enormous price increases that romised large returns for early users. The return characteristics of cryptocurrencies have been studied by various scholars and some have even declared cryptocurrencies to be an asset class instead of a digital currency. Due to the fast changes in the cryptocurrency market and the increased importance of other cryptocurrencies than Bitcoin, we believe that research focusing on the financial performance of cryptocurrencies should be renewed on a regular basis. Therefore, with this work we aim to shed light on the return characteristics of cryptocurrencies in relation to traditional asset classes and on the potential of cryptocurrencies to improve portfolio diversification. In addition, we investigate the cryptocurrency market, describe selected cryptocurrencies in more detail and provide an overview of potential technological risks arising with the use of cryptocurrencies. Our results indicate that cryptocurrencies provide large return potentials with high levels of volatility but compared to traditional asset classes provide a higher level of return per level of risk. We also find that selected cryptocurrencies can improve diversification in a cryptocurrency portfolio, as well as in a portfolio of international equity and private equity investments. Keywords: Alternative Asset Classes, Cryptocurrency, Portfolio Diversification, Risk-Reward Profile und Cryptocurrency Risks
Lanny Z. N. Yuan, Huaibing Jian, Peng Liu, Pengxin Zhu · 5 authors
In this white paper, we propose a blockchain-based system, named AME, which is a decentralized infrastructure and application platform with enhanced security and self-management properties. The AME blockchain technology aims to increase the transaction throughput by adopting various optimizations in network transport and storage layers, and to enhance smart contracts with AI algorithm support. We introduce all major technologies adopted in our system, including blockchain, distributed storage, P2P network, service application framework, and data encryption. To properly provide a cohesive, concise, yet comprehensive introduction to the AME system, we mainly focus on describing the unique definitions and features that guide the system implementation.
Intelligent Cyber-physical systems can be modelled as multi-agent systems\nwith planning capability to impart adaptivity for changing contexts. In such\nmulti-agent systems, the protocol for plan execution must result in the proper\ncompletion and ordering of actions in spite of their distributed execution.\nHowever, in untrusted scenarios, there is a possibility of agents not\nrespecting the protocol either due to faults or due to malicious reasons\nthereby resulting in plan failure. In order to prevent such situations, we\npropose to implement the execution of agents through smart contracts. This\npoints to a generic architecture seamlessly integrating intelligent\nplanning-based CPS and smart-contracts.\n
The article presents the analysis and evaluation of the essence of bitcoin (and other cryptocurrencies) from the perspective of its (their) adaptability to the Muslim concept of money. From an economic point of view in the so-called Western culture, all the classical functions of money cannot be fully attributed to bitcoin. Although it performs the function of an exchange medium and the means of payment, it does not fulfil the role of a value storing instrument and thus proves to be a defective measure of value. In the Islamic world, the perception of bitcoin as money is a more complex problem because its economic presentation overlaps with religious issues. Such relationship results in a situation when the answer to the question: can bitcoin be approached as money, is formulated on the basis of a subjective interpretation of the Sharia law, which is also ambiguous.
Trust issue gradually becomes more of a concern in the 21st century business environment. Recent research sheds light on the erosion of trust to brands on a global basis. Traditionally, trusted third parties take place to ensure the trust needed for business transactions to take place. Digitization, advances in peer-to-peer networks and cryptographic technologies have advanced to such a point that exchange of currency, as in the case of Bitcoin, and even value as in the case of property rights, securities, ownership etc. can be done over Internet with Blockchain technology serving as a trust layer baked into the protocol. Blockchain technology serves as the missing trust layer in the evolution of Internet. This paper explores implications of Blockchain technology on marketing discipline from various aspects. The paper pinpoints the key strategies marketers need to adopt to survive in the rapidly evolving business landscape. Finally, conclusions are drawn regarding future direction of marketing as affected by those technological advances.
This paper proposes a blockchain-based data checking scheme to protect data integrity in Internet of Things (IoT). Traditional data integrity schemes such as symmetric key approaches and public key infrastructure (PKI) suffer from the single-point of failure and network congestion due to the centralized architecture. Motivated by the distributed data authentication in blockchain, we propose to adopt blockchain to ensure the data integrity in IoT networks. However, the existing blockchain scheme cannot be directly applied to IoT nodes with limited computing and network resources. Hence, we develop a stochastic blockchain scheme to limit the number of cooperative nodes and distribute the load to IoT edge nodes. In our scheme, the IoT data are broadcast by randomly selected cooperative nodes, thereby introducing uncertainty to the attacker and improving the system security level. Finally, we propose a lightweight mining process to make only the IoT edge nodes compete for block generation and share the block with other nodes. If our scheme is used in the case of having 9,000 legitimate nodes and 1,000 compromised nodes, only three cooperative nodes can achieve the probability of successful defense over 99 percent.
We present SOLAR, a new analysis tool for automatically detecting standard violation errors in Ethereum smart contracts.Given the Ethereum Virtual Machine (EVM) bytecode of a smart contract and a user specified constraint or invariant derived from a technical standard such as ERC-20,SOLAR symbolically executes the contract, explores all possible execution paths, and checks whether it is possible to initiate a sequence of malicious transactions to violate the specified constraint or invariant. Our experimental results highlight the effectiveness of SOLAR in finding new errors in smart con-tracts. Out of the evaluated 779 ERC-20 and 310 ERC-721smart contracts, SOLAR found 255 standard violation errors in 197 vulnerable contracts with only three false positives.237 out of the 255 errors are zero-day errors that are not re-ported before. Our results sound the alarm on the prevalence of standard violation errors in critical smart contracts that manipulate publicly traded digital assets
Davy Preuveneers, Vera Rimmer, Ilias Tsingenopoulos, Jan Spooren · 6 authors
The adoption of machine learning and deep learning is on the rise in the cybersecurity domain where these AI methods help strengthen traditional system monitoring and threat detection solutions. However, adversaries too are becoming more effective in concealing malicious behavior amongst large amounts of benign behavior data. To address the increasing time-to-detection of these stealthy attacks, interconnected and federated learning systems can improve the detection of malicious behavior by joining forces and pooling together monitoring data. The major challenge that we address in this work is that in a federated learning setup, an adversary has many more opportunities to poison one of the local machine learning models with malicious training samples, thereby influencing the outcome of the federated learning and evading detection. We present a solution where contributing parties in federated learning can be held accountable and have their model updates audited. We describe a permissioned blockchain-based federated learning method where incremental updates to an anomaly detection machine learning model are chained together on the distributed ledger. By integrating federated learning with blockchain technology, our solution supports the auditing of machine learning models without the necessity to centralize the training data. Experiments with a realistic intrusion detection use case and an autoencoder for anomaly detection illustrate that the increased complexity caused by blockchain technology has a limited performance impact on the federated learning, varying between 5 and 15%, while providing full transparency over the distributed training process of the neural network. Furthermore, our blockchain-based federated learning solution can be generalized and applied to more sophisticated neural network architectures and other use cases.
The digitalization and massive adoption of advanced technologies in the automotive industry not only transform the equipment manufacturer's operating mode, but also change the current business models. The increased adoption of autonomous cars is expected to disrupt government regulations, manufacturing, insurance, and maintenance services. Moreover, providing integrated, personalized, and on-demand services have shared, connected, and autonomous cars in the smart city for a sustainable ecosystem. To address these issues in this paper, we propose a blockchain-based distributed framework for the automotive industry in the smart city. The proposed framework includes a novel miner node selection algorithm for the blockchain-based distributed network architecture. To evaluate the feasibility of the proposed framework, we simulated the proposed model on a private Ethereum blockchain platform using captured dataset of mined blocks from litecoinpool.org. The simulation results show the proof-of-concept of the proposed model that can be used for wide range of future smart applications.
Muhammad Salek Ali, Massimo Vecchio, Miguel Pincheira, Koustabh Dolui · 6 authors
The blockchain technology has revolutionized the digital currency space with the pioneering cryptocurrency platform named Bitcoin. From an abstract perspective, a blockchain is a distributed ledger capable of maintaining an immutable log of transactions happening in a network. In recent years, this technology has attracted significant scientific interest in research areas beyond the financial sector, one of them being the Internet of Things (IoT). In this context, the blockchain is seen as the missing link toward building a truly decentralized, trustless, and secure environment for the IoT and, in this survey, we aim to shape a coherent and comprehensive picture of the current state-of-the-art efforts in this direction. We start with fundamental working principles of blockchains and how blockchain-based systems achieve the characteristics of decentralization, security, and auditability. From there, we build our narrative on the challenges posed by the current centralized IoT models, followed by recent advances made both in industry and research to solve these challenges and effectively use blockchains to provide a decentralized, secure medium for the IoT.
The subject matter of the article is the substantiation of the problems and perspectives of the introduction of Distributed Ledger Technologies (DLT) / Blockchain in the public and private sectors as a modern digital economy instrument. The goal of the work is to substantiate the scientific and methodical principles of implementing the technologies of distributed DLT / Blockchain registers. The following tasks were solved in the article: the notion of Distributed Ledger Technologies (DLT) and Blockchain is defined; types of Distributed DLT Registries are presented in the form of a classification with a distinction of features and possibilities of application of each type; the general scheme of work is described and the specific features of the Blockchain technology are systematized;the features and directions of the use of intelligent contracts (smart contracts) based on the technology of blockchain are singled out;the international experience of government initiatives and pilot projects of the blockade technology application has been analyzed; the analysis of the domestic experience of practical application of Blockchain technologies in the public and private sectors and the perspective areas for the future application of technologies of the distributed DLT registries are identified; according to the international analytical agencies research results, the obstacles of the Blockchain technologies implementation in the public and private sectors are systematized. The following methods are used: abstract-logical analysis, theoretical generalization, system and statistical analysis. The following results were obtained. The concept of technologies of distributed DLT / Blockchain registries is disclosed. The availability of the system is based on open, private and federal DLTs. The specific features of DLT / Blockchain distributed registry technologies include centralization, involvement of a large number of participants to achieve consensus, use of cryptography and digital signatures, almost impossible to change chronological records, the convenience of tracking and verifying information, and the ability to program. The international experience of using Blockchain technology in countries such as the Great Britain, Georgia, Estonia, the USA, the United Arab Emirates, Italy has been researched. Examples of practical implementation of DLT / Blockchain registry technology in Ukraine are considered. The main obstacles to implementing distributed DLT / Blockchain registries in the public sector are regulatory restrictions and technology immaturity. The obstacles to the introduction of block technologies in the private sector are identified. Conclusions: It is proved that the distributed DLT registry technology has a significant potential for development for the future digital economy. Nevertheless, there are a number of barriers to their full use in the public and private sector, which requires further study by experts.