There has been a burgeoning Fintech literature in the past years, especially on cryptocurrencies. However, there is lack of research handling cryptocurrencies in a mainstream macroeconomic model. To bridge the gap, we develop a model for Bitcoin-like cryptocurrency as risky and costly bubbles in an infinite-horizon production economy. This model is consistent with the following facts: i) the surging Bitcoin market presents enormous volatility, ii) its price dynamics are significantly sensitive to both market sentiment and policy stances. Entrepreneurial firms choose to hold Bitcoins as liquid assets to buffer idiosyncratic investment distortions. The intrinsically worthless Bitcoins can emerge as rational bubbles when the market sentiment is optimistic enough. On the one hand, bubbly Bitcoins provide market liquidity to facilitate investment in the real sector, while on the other hand, they deteriorate the investment efficiency and crowd out aggregate production. Our quantitative exercise produces various cyclical features of Bitcoin bubbles and find that the collapse of Bitcoin bubbles can improve social welfare by decreasing distortion-driven real investment.
Jan 1, 2018·Proceedings of the ... Annual Hawaii International Conference on System Sciences/Proceedings of the Annual Hawaii International Conference on System Sciences
Due to the disruptive role of the Bitcoin in the financial sector, both scholars and practitioners are increasingly wondering whether it is possible to replicate the impact of the Blockchain technology in the supply chain context. As a distributed ledger technology characterized by the decentralized consensus, Blockchain is touted by many as the proper platform to collect all the information about supply chains from the producer to the consumer. However, the current technology immaturity and the lack of successful supply chain implementations pave the way for doubt about the disruptive role of this technology in supply chains. To the authors’ knowledge, this work is one of the very first attempts to link the blockchain technology to supply chain and logistics. This paper investigates the state-of-the-art application of blockchain in supply chains, exploring both the literature and the industry initiatives, contributing to the increase of the managerial insight and providing a future research agenda.
Yu Zhuang, Lincoln Sheets, Zon‐Yin Shae, Jeffrey J. P. Tsai · 5 authors
"Blockchain" is a distributed ledger technology originally applied in the financial sector. This technology ensures the integrity of transactions without third-party validation. Its functions of decentralized transaction validation, data provenance, data sharing, and data integration are a good fit for the needs of health information exchange and clinical trials. We investigated the current workflow of Health Information Exchange and clinical trials; conducted design thinking processes with clinicians, trial managers, informaticians, and blockchain professionals; and implemented a private blockchain model to tackle known issues. We used coded Smart Contract regulations to simulate several scenarios in healthcare processes. This proof-of-concept work provides a feasible simulation for potential solutions to monitor clinical trials across different census regions persistently. Various levels of data access privileges have been designed to utilize a suite of customized Smart Contract settings. These settings emulate the workflow protocols for the monitoring entities, trial sponsors, clinical sponsors and participating subjects. Keywords: Blockchain, Smart Contract, Health Information Exchange, Clinical Trial, Persistent Monitoring.
Open access
Blockchain Technology Applications and Security
Scientific Computing and Data Management
Artificial Intelligence in Healthcare and Education
Phan The Duy, Do Thi Thu Hien, Do Hoang Hien, Van-Hau Pham
In the "Industry 4.0" era, blockchain as well as related distributed ledger technologies has been an unmissable trend for both academy and industry recently. Blockchain technology has become famous as the innovative technology that underlies cryptocurrencies such as Bitcoin and Ethereum platform. It also has been spreading with multiple industries exploring their capabilities and new blockchain use cases springing up on a daily basis. Its emergence has brought a great deal of impact on how the information will be stored and processed securely. Furthermore, almost of advocates say that blockchain will disrupt and change everything from education to financial payments, insurance, intellectual property, healthcare,... in the years to come. However, a comprehensive survey on potential and issues of blockchain adoption in academy and industry has not been yet accomplished. This paper tries to conduct a comprehensive survey on the blockchain technology adoption by discussing its influences as well as the opportunities and challenges when utilizing it in the real-world scenarios.
Konstantinos Chalkias, James Brown, Mike Hearn, Tommy Lillehagen · 6 authors
Inspired by the blockchain architecture and existing Merkle tree based signature schemes, we propose BPQS, an extensible post-quantum (PQ) resistant digital signature scheme best suited to blockchain and distributed ledger technologies (DLTs). One of the unique characteristics of the protocol is that it can take advantage of application-specific chain/graph structures in order to decrease key generation, signing and verification costs as well as signature size. Compared to recent improvements in the field, BPQS outperforms existing hash-based algorithms when a key is reused for reasonable numbers of signatures, while it supports a fallback mechanism to allow for a practically unlimited number of signatures if required. We provide an open source implementation of the scheme and benchmark it.
Francisco De La Vega, Javier Soriano, Miguel Jiménez, David Lizcano
Modern IoT deployments do require considerable investments that might only be justified if the data being gathered could be monetized, which leads to the need for a digital data marketplace. In many cases, the provider of the IoT data needs to process it locally for data curation, aggregation, stream processing, etc. At the same time, the consumer could be interested in nearby data. This scenario resembles a fog computing architecture where companies require being able, keeping data under their control, to securely make it available to other companies in a peer‐to‐peer fashion, without needing a cloud intermediary (like traditional marketplaces do), thus maximizing the locality of the processing and avoiding the existence of a bottleneck when the intermediary makes the data delivery for accounting purposes. Nevertheless, this imposes a hard requirement: by not having a central marketplace, the peers (seller and customer) need to trust each other, which, in turn, requires enforcing a nonrepudiation schema. In this paper, the authors propose a distributed peer‐to‐peer architecture for such a data marketplace that takes advantage of the architectural fundamentals of fog computing, in which data processing, filtering, and stream based event generation is done in a fog node along with the data, and where relationships, both commercial agreements and data delivery, are performed directly between producers and consumers without the need of mutual trust thanks to the usage of blockchain principles (e.g., distributed ledger, consensus mechanism). The proposed architecture is validated through a case study involving a set of key issues regarding nonrepudiation commonly identified when moving from a centralized marketplace to a distributed one. Moreover, it is shown that the proposed solution does not bring in any limitation with regard to a centralized marketplace solution, in terms of pricing models (subscriptions, pay‐per‐use, etc.) or usage conditions (contract duration, updates rate, etc.).
This paper takes an initial step forward in bringing to life the certification mechanisms according to Art. 42 of the General Data Protection Regulation (GDPR). These newly established methods of legal specification act not only as a central vehicle for overcoming widely articulated and discussed legal challenges, but also as a sandbox for the much needed close collaboration between computer sciences and legal studies. In order to illustrate, for example, what data protection seals could look like in the future, the authors propose a methodology for "translating" legal requirements into technical guidelines: architectural blueprints designed using legal requirements. The purpose of these blueprints is to show developers how their solutions might comply with the principle of Privacy by Design (Art. 25 GDPR). To demonstrate this methodology, the authors propose an architectural blueprint that embodies the legal concept of the data subject’s consent (Art. 6 sec. 1 lit. a GDPR) and elevates best practice to a high standard of Privacy by Design. Finally, the authors highlight further legal problems concerning blockchain technology under the GDPR that will have to be addressed in order to achieve a comprehensive certification mechanism for Privacy by Blockchain Design in the future.
Athina-Styliani Kleinaki, Petros Mytis-Gkometh, George Drosatos, Pavlos S. Efraimidis · 5 authors
Biomedical research and clinical decision depend increasingly on scientific evidence realized by a number of authoritative databases, mostly public and continually enriched via peer scientific contributions. Given the dynamic nature of biomedical evidence data and their usage in the sensitive domain of biomedical science, it is important to ensure retrieved data integrity and non-repudiation. In this work, we present a blockchain-based notarization service that uses smart digital contracts to seal a biomedical database query and the respective results. The goal is to ensure that retrieved data cannot be modified after retrieval and that the database cannot validly deny that the particular data has been provided as a result of a specific query. Biomedical evidence data versioning is also supported. The feasibility of the proposed notarization approach is demonstrated using a real blockchain infrastructure and is tested on two different biomedical evidence databases: a publicly available medical risk factor reference repository and on the PubMed database of biomedical literature references and abstracts.
Open access
Blockchain Technology Applications and Security
Retinal Imaging and Analysis
Artificial Intelligence in Healthcare and Education
In this paper, we present a prototype of multi-user system for access control to datasets stored in an untrusted cloud environment. Cloud storage like any other untrusted environment needs the ability to secure share information. Our approach provides an access control over the data stored in the cloud without the provider participation. The main tool of access control mechanism is ciphertext-policy attribute-based encryption scheme with dynamic attributes. Using a blockchain-based decentralized ledger, our system provides immutable log of all meaningful security events, such as key generation, access policy assignment, change or revocation, access request. We propose a set of cryptographic protocols ensuring privacy of cryptographic operations requiring secret or private keys. Only ciphertexts of hash codes are transferred through the blockchain ledger. The prototype of our system is implemented using smart contracts and tested on Ethereum blockchain platform.
Michał Pawlak, Aneta Poniszewska-Marańda, Natalia Kryvinska
There are many existing voting solutions which have different benefits and issues. The most significant ones are lack of transparency and auditability. Recently developed blockchain technology may be a solution to these issues. The paper describes the use of intelligent agents and multi-agent system concept for Auditable Blockchain Voting System (ABVS), which integrates e-voting process with blockchain technology into one supervised non-remote internet voting system which is end-to-end verifiable.
Sepideh Avizheh, Reihaneh Safavi–Naini, Siamak F. Shahandashti
BIP70 is the Bitcoin payment protocol for communication between a merchant and a pseudonymous customer. McCorry et al. (FC~2016) showed that BIP70 is prone to refund attacks and proposed a fix that requires the customer to sign their refund request. They argued that this minimal change will provide resistance against refund attacks. In this paper, we point out the drawbacks of McCorry et al.'s fix and propose a new approach for protection against refund attacks using the Bitcoin multi-signature mechanism. Our solution does not rely on merchants storing refund requests, and unlike the previous solution, allows updating refund addresses through email. We discuss the security of our proposed method and compare it with the previous solution. We also propose a novel application of our refund mechanism in providing anonymity for payments between a payer and payee in which merchants act as mixing servers. We finally discuss how to combine the above two mechanisms in a single payment protocol to have an anonymous payment protocol secure against refund attacks.
Ilaria Bertazzi, Sylvie Huet, Guillaume Deffuant, Floriana Gargiulo
Bitcoin-otc is a peer to peer (over-the-counter) marketplace for trading with bit- coin crypto-currency. To mitigate the risks of the p2p unsupervised exchanges, the establishment of a reliable reputation systems is needed: for this reason, a web of trust is implemented on the website. The availability of all the historic of the users interaction data makes this dataset a unique playground for studying reputation dynamics through others evaluations. We analyze the structure and the dynamics of this web of trust with a multilayer network approach distin- guishing the rewarding and the punitive behaviors. We show that the rewarding and the punitive behavior have similar emergent topological properties (apart from the clustering coefficient being higher for the rewarding layer) and that the resultant reputation originates from the complex interaction of the more regular behaviors on the layers. We show which are the behaviors that correlate (i.e. the rewarding activity) or not (i.e. the punitive activity) with reputation. We show that the network activity presents bursty behaviors on both the layers and that the inequality reaches a steady value (higher for the rewarding layer) with the network evolution. Finally, we characterize the reputation trajectories and we identify prototypical behaviors associated to three classes of users: trustworthy, untrusted and controversial.
We develop a strong diagnostic for bubbles and crashes in bitcoin, by analyzing the coincidence (and its absence) of fundamental and technical indicators. Using a generalized Metcalfe's law based on network properties, a fundamental value is quantified and shown to be heavily exceeded, on at least four occasions, by bubbles that grow and burst. In these bubbles, we detect a universal super-exponential unsustainable growth. We model this universal pattern with the Log-Periodic Power Law Singularity (LPPLS) model, which parsimoniously captures diverse positive feedback phenomena, such as herding and imitation. The LPPLS model is shown to provide an ex-ante warning of market instabilities, quantifying a high crash hazard and probabilistic bracket of the crash time consistent with the actual corrections; although, as always, the precise time and trigger (which straw breaks the camel's back) being exogenous and unpredictable. Looking forward, our analysis identifies a substantial but not unprecedented overvaluation in the price of bitcoin, suggesting many months of volatile sideways bitcoin prices ahead (from the time of writing, March 2018).
George Bissias, Brian Neil Levine, David Thibodeau
Abrupt changes in the miner hash rate applied to a proof-of-work (PoW) blockchain can adversely affect user experience and security. Because different PoW blockchains often share hashing algorithms, miners face a complex choice in deciding how to allocate their hash power among chains. We present an economic model that leverages Modern Portfolio Theory to predict a miner's allocation over time using price data and inferred risk tolerance. The model matches actual allocations with mean absolute error within 20% for four out of the top five miners active on both Bitcoin (BTC) and Bitcoin Cash (BCH) blockchains. A model of aggregate allocation across those four miners shows excellent agreement in magnitude with the actual aggregate as well a correlation coefficient of 0.649. The accuracy of the aggregate allocation model is also sufficient to explain major historical changes in inter-block time (IBT) for BCH. Because estimates of miner risk are not time-dependent and our model is otherwise price-driven, we are able to use it to anticipate the effect of a major price shock on hash allocation and IBT in the BCH blockchain. Using a Monte Carlo simulation, we show that, despite mitigation by the new difficulty adjustment algorithm, a price drop of 50% could increase the IBT by 50% for at least a day, with a peak delay of 100%.
Jan 1, 2018·International Conference on International Conference on Emerging Technologies in Computing 2018 (iCETiC '18) , 23rd -24th August, 2018, at London Metropolitan University, London, UK, Published by Springer-Verlag
Blockchain (BC), the technology behind the Bitcoin cryptocurrency system, is starting to be adopted for ensuring enhanced security and privacy in the Internet of Things (IoT) ecosystem. Fervent research is currently being focused in both academia and industry in this domain. Proof of Work (PoW), a cryptographic puzzle, plays a vital role in ensuring BC security by maintaining a digital ledger of transactions, which are considered to be incorruptible. Furthermore, BC uses a changeable Public Key (PK) to record the identity of users, thus providing an extra layer of privacy. Not only in cryptocurrency has the successful adoption of the BC been implemented, but also in multifaceted non-monetary systems, such as in: distributed storage systems, proof of location and healthcare. Recent research articles and projects or applications were surveyed to assess the implementation of the BC for IoT Security and identify associated challenges and propose solutions for BC enabled enhanced security for the IoT ecosystem.
Stealth address prevents public association of a blockchain transaction's output with a recipient's wallet address and hides the actual destination address of a transaction. While stealth address provides an effective privacy-enhancing technology for a cryptocurrency network, it requires blockchain nodes to actively monitor all the transactions and compute the purported destination addresses, which restricts its application for resource-constrained environments like Internet of Things (IoT). In this paper, we propose DKSAP-IoT, a faster dual-key stealth address protocol for blockchain-based IoT systems. DKSAP-IoT utilizes a technique similar to the TLS session resumption to improve the performance and reduce the transaction size at the same time between two communication peers. Our theoretical analysis as well as the extensive experiments on an embedded computing platform demonstrate that DKSAP-IoT is able to reduce the computational overhead by at least 50% when compared to the state-of-the-art scheme, thereby paving the way for its application to blockchain-based IoT systems.
Simona Ibba, Andrea Pinna, Gavina Baralla, Michele Marchesi
Abstract An Initial Coin Offering (ICO) is an innovative way to raise funds and launch a startup. It is also an opportunity to take part in a project, or in a DAO (Decentralized Autonomous Organization). The use of ICO is a global phenomenon that involves many nations and several business categories: ICOs collected over 5.2 billion dollars only in 2017. The success of an ICO is based on the credibility and innovativeness of project proposals. This fund-raising tool contains however some critical issues, such as the use of tokens that have no intrinsic value and do not generate direct liquidity, and the role of investors in the management of the startup. We analyzed if the Lean Startup methodology is helpful to face this critical aspects and we examined some ICOs in which the proposing team states explicitly that a lean startup approach is used.
Recent work, including ZKBoo, ZKB++, and Ligero, has developed efficient non-interactive zero-knowledge proofs of knowledge (NIZKPoKs) for Boolean circuits based on symmetric-key primitives alone, using the "MPC-in-the-head" paradigm of Ishai et al. We show how to instantiate this paradigm with MPC protocols in the preprocessing model; once optimized, this results in an NIZKPoK with shorter proofs (and comparable computation) as in prior work for circuits containing roughly 300--100,000 AND~gates. In contrast to prior work, our NIZKPoK also supports witness-independent preprocessing, which allows the prover to shift most of its work to an offline phase before the witness is known. We use our NIZKPoK to construct a signature scheme based only on symmetric-key primitives (and hence with "post-quantum" security). The resulting scheme has shorter signatures than the scheme built using ZKB++ (and comparable signing/verification time), and is even competitive with hash-based signature schemes. To further highlight the flexibility and power of our NIZKPoK, we also use it to build efficient ring and group signatures based on symmetric-key primitives alone. To our knowledge, the resulting schemes are the most efficient constructions of these primitives that offer post-quantum security.
As the underlying technology in Bitcoin, the blockchain technology has gained wide attention. Blockchain is a kind of feasible method to solve the consistency problem of distributed system. Consensus mechanism is the core of the blockchain technology. Delicate consensus mechanism can improve system performance and promote the application of blockchain in many fields. Based on the consensus mechanisms in existing design of blockchain, this paper summarizes the basic consensus mechanisms including proof of work, proof of stake and Byzantine consistency agreement, and evaluates them from various aspects such as security, scalability, performance, etc. The future research on the blockchain consensus mechanism will be based on the different characteristics of the consensus mechanisms, and design should be carried out around the combination of different consensus mechanisms.