Blockchain Papers

Joost de Kruijff, Hans Weigand

No abstract is available for this record.

Benjamin Egelund-Müller, Martin Elsman, Fritz Henglein, Omri Ross

No abstract is available for this record.

Markus Knecht, Burkhard Stiller

Abstract Smart contracts on a blockchain behave exactly as specified by their code. To be sure that a smart contract behaves as expected, the end-user has to either analyze its code or trust a potentially anonymous developer or auditor to do so. This approach proposes a smart contract deployment and management platform that can execute development tools and code quality tools in a trusted way and uses this to reduce the trust required into the smart contract developer or auditor. Additionally, such a platform can provide new capabilities for developers aiding them in the creation of smart contracts.

Christoph Van der Elst, Anne Lafarre

No abstract is available for this record.

Jonatan Bergquist

The purpose of this Master's thesis is to explore blockchain technology and smart contracts as a way of building privacy-sensitive applications. The main focus is on a medication plan containing prescriptions, built on a blockchain system of smart contracts. This is an example use case, but the results can be transferred to other ones where sensitive data is being shared and a proof of validity or authentication is needed. First the problem is presented, why medication plans are in need of digitalisation and why blockchain technology is a fitting technology for implementing such an application. Then blockchain technology is explained, since it is a very new and relatively unfamiliar IT construct. Thereafter, a design is proposed for solving the problem. A system of smart contracts was built to prove how such an application can be built, and suggested guidelines for how a blockchain system should be designed to fulfil the requirements that were defined. Finally, a discussion is held regarding the applicability of different blockchain designs to the problem of privacy-handling applications.

Octavian Nica, Karolina Piotrowska, Klaus Reiner Schenk–Hoppé

No abstract is available for this record.

Usman W. Chohan

Services known as Cryptocurrency “Tumblers” obfuscate the provenance, possession, and movement of cryptocurrencies through a process of “mixing” . While this speaks to the cryptoanarchist philosophical roots of cryptocurrencies, it poses various forms of risks, particularly those subsumed by the anti-money laundering (AML) category. This discussion paper examines that dichotomy, between cryptoanarchism and oversight, through the Tumbler lens, so as to consider the regulation, oversight, and legality of Tumblers themselves.

Gapur Oziev, Magomet Yandiev

No abstract is available for this record.

Chandra Adhikari

Achieving data confidentiality and integrity while maintaining secure access is essential in various fields, including in the medical sector. Implementing a blockchain-based technology to secure medical data makes the data decentralized and ensures that the users are the owners and have control over their own data. While blockchain technology (e.g. Ethereum) is still in its infancy, it’s the cutting-edge of research in many industries and universities. The decentralized system of blockchain along with the presence of smart contracts to automate tasks are the two major features that can be utilized to replace our current imperfect health system and invent a secure, flexible, and more reliable system for data protection. Using this technology will require patients to be accountable for their medical records while allowing to 1) store electronic medical records (EMR) for a patient’s lifetime, 2) advance the development of precise medicines, 3) enable medical authorities to securely share medical data. In order to build a robust system to protect medical data, my research will focus on the security aspect of the system by analyzing the blockchain technology constraints, and carefully designing and implementing a secure and scalable system using Ethereum blockchain and smart contracts.

Jona Derks, Jaap Gordijn, Arjen Siegmann

Bitcoin is a widely-spread payment instrument, but it is doubtful whether the proof-of-work (PoW) nature of the system is financially sustainable on the long term. To assess sustainability, we focus on the bitcoin miners as they play an important role in the proof-of-work consensus mechanism of bitcoin to create trust in the currency. Miners offer their services against a reward while recurring expenses. Our results show that bitcoin mining has become less profitable over time to the extent that profits seem to converge to zero. This is what economic theory predicts for a competitive market that has a single homogenous good. We analyze the actors involved in the bitcoin system as well as the value flows between these actors using the e3value methodology. The value flows are quantified using publicly available data about the bitcoin network. However, two important value flows for the miners, namely hardware investments and expenses for electricity power, are not available from public sources. Therefore, we contribute an approach to estimate the installed base of bitcoin hardware equipment over time. Using this estimate, we can calculate the expenses miner should have. At the end of our analysis period, the marginal profit of mining a bitcoin becomes negative, i.e., to a loss for the miners. This loss is caused by the consensus mechanism of the bitcoin protocol, which requires a substantial investment in hardware and significant recurring daily expenses for energy. Therefore, a sustainable crypto currency needs higher payments for miners or more energy efficient algorithms to achieve consensus in a network about the truth of the distributed ledger.

Jamal Bouoiyour, Refk Selmi

Much significant research has been done to investigate various facets of the link between Bitcoin price and its fundamental sources. This study goes beyond by looking into least to most influential factors-across the fundamental, macroeconomic, financial, speculative and technical determinants as well as the 2016 events-which drove the value of Bitcoin in times of economic and geopolitical chaos. We use a Bayesian quantile regression to inspect how the structure of dependence of Bitcoin price and its determinants varies across the entire conditional distribution of Bitcoin price movements. In doing so, three groups of determinants were derived. The use of Bitcoin in trade and the uncertainty surrounding China's deepening slowdown, Brexit and India's demonetization were found to be the most potential contributors of Bitcoin price when the market is improving. The intense anxiety over Donald Trump being the president of United States was shown to be a positive determinant pushing up the price of Bitcoin when the market is functioning around the normal mode. The velocity of bitcoins in circulation, the gold price, the Venezuelan currency demonetization and the hash rate were found to be the fundamentals influencing the Bitcoin price when the market is heading into decline.

Élise Alfieri, Radu Burlacu, Geoffroy Enjolras

Purpose The purpose of this article is to provide some insights on the true nature of bitcoin and to study empirically its performance by using robust models, widely used in the academic literature. Previous studies assess performance with simple measures such as the Sharpe ratio. Such measures are insufficient because they do not take into account the bitcoin’s specificities, such as the possibilities to diversify risk. Design/methodology/approach The authors use quantitative methodologies to assess the performance of financial assets. Performance is defined as a risk-adjusted return. The authors use regression analysis and measure bitcoin’s performance as the constant term ( α ) of the projection of its returns on the returns of relevant factors of risk. Findings Bitcoin has low correlation with the market index and with factor-mimicking portfolios, which indicates opportunities to diversify risk. The performance of bitcoin ( α ) is positive and significant; this result is robust across period and world region specifications. Research limitations/implications The true nature of bitcoin is subject of debate and needs further research. Furthermore, other factors should be considered in analysing the bitcoin’s performance, such as those related to investors’ behaviour or political risk. Practical implications The empirical results obtained in this paper may be used by professional portfolio managers to diversify risk and to enhance their portfolio’s performance. Originality/value This paper adds to the literature by arguing that bitcoin has the nature of common stock, and therefore, its performance has to be assessed with models that are relevant for this type of securities. This paper is the first using performance models that adjust returns for relevant sources of risk.

Asif Agha

Abstract What role do forms of money play in social life? What kinds of sociocultural variation do they exhibit? What variety of things do people do with varieties of money? How are activities involving money differentiated into registers of money conduct in specific times and places? How are specific forms of money conduct recognized and differentiated from other cultural routines by those who encounter them? It has long been understood that money is intimately linked to varied forms of discursive semiosis through which distinct forms of money are created and endowed with distinct use characteristics; that specific forms of money are readily linked to (or appropriated by) group-specific interests or ideologies; and that differences in types of money conduct readily differentiate social roles and relationships among persons and groups in social history. Yet the role of discursive semiosis in the existence and use of money is not well understood, a lacuna that links most descriptions of “money” to voicing structures (or discursive positionalities) that are not grasped for what they are by those who offer such descriptions (e.g., “speaking like the State” without knowing it). This article clarifies the role of discursive semiosis in the social life of money. It shows that such clarification is a prerequisite on ethnographic answers to the questions listed at the beginning of this abstract. It presents a comparative framework for reasoning about forms of money in forms of life.

Pratyush Dikshit, Kunwar Singh

Bitcoin is a digital currency based on cryptographic algorithms. All the transactions of this currency are recorded and stored in a publically available database called blockchain. Since, these transactions are available to everyone, bitcoins must be stored in a secured wallet. These bitcoin wallets can be opened only by its secret key. And if once the secret key of the wallet is lost, it cannot be recovered because of the irreversible nature of bitcoin transaction. To root out this problem, Goldfeder et al. [4] proposed a solution of threshold signature scheme compatible with bitcoins signature by using Elliptic Curve Digital Signature Algorithm (ECDSA) providing security policy of shared control of a wallet in which each player gets only a single share. Considering an important point of priority/weightage of players, Dikshit and Singh [12] first proposed a scheme in which each player is given one or more shares of the secret key according to his weightage/priority. This scheme has a drawback of managing and handling many keys by each player. Suppose a player has weightage w, then he possesses w different shares of secret key. This problem is resolved in the proposed scheme in this paper. We propose a scheme in which all the players get single share and can accomplish the requirements of concept of weightage. We extend the weighted threshold ECDSA scheme in order to realize efficient weighted threshold ECDSA scheme.

Hanqing Liu, Na Ruan, Rongtian Du, Weijia Jia

Selfish mining is a well-known mining attack strategy discovered by Eyal and Sirer in 2014. After that, the attackers' strategy has been further discussed by many other works, which analyze the strategy and behavior of a single attacker. The extension of the strategy research is greatly restricted by the assumption that there is only one attacker in the blockchain network, since, in many cases, a proof of work blockchain has multiple attackers. The attackers can be independent of others instead of sharing information and attacking the blockchain as a whole. In this paper, we will establish a new model to analyze the miners' behavior in a proof of work blockchain with multiple attackers. Based on our model, we extend the attackers' strategy by proposing a new strategy set publish-n. Meanwhile, we will also review other attacking strategies such as selfish mining and stubborn mining in our model to explore whether these strategies work or not when there are multiple attackers. The performances of different strategies are compared using relative stale block rate of the attackers. In a proof of work blockchain model with two attackers, strategy publish-n can beat selfish mining by up to 26.3%.

William J. Luther

Abstract By declaring an item legal tender or making it publicly receivable, governments might generate sufficient demand to determine the medium of exchange. How do private actors launch a new money? There are two views in the literature. The first requires offering an item with a use value to some agents that is distinct from its role as a medium of exchange. The second suggests that agents might coordinate on an intrinsically useless item. With these views in mind, I survey the logs from the original bitcoin forum, bitcoin-list. I find that early participants in the bitcoin community understood the importance of coordination and took steps to coordinate users.

Daniel Leung, Astrid Dickinger

No abstract is available for this record.

Emilien Bai, Kåre Synnes

This paper presents the design and implementation of a reward system for collaborative care of elderly based on distributed ledger technologies. The work is motivated by the demographic change, where an aging population consequently increases the need for care. This causes a great tension in our society, as care resources become increasingly constrained, both regarding costs and availability of care staff. Much of the daily care of the elderly is today done by family members (spouses, children) and friends, often on a voluntarily basis, which adds to the tension. The core idea of this work is to help broaden the involvement of people in caring for our elderly, enabled by a system for collaborative care. The proposed system benefits from recent advances in distributed ledger technologies, which similarly to digital currencies, are build on the ability for mutual agreements between people who do not know each other. The system also benefits from recent gamification techniques to motivate people to collaborate on a larger scale through performing simple daily tasks. The system builds on rewards automatically given when these smart contracts are fulfilled, a gamification technique that is believed to maintain motivation of the volunteers. In this paper, we thus describe a reward system designed to connect elderly and volunteers by mutual agreements implemented as smart contracts.

José Parra-Moyano

Abstract This article studies the origin and continuity of the identity of the entities inscribed in a distributed ledger. Specifically, it focuses on the differences between the identities of the entities that exist in a distributed ledger and those of the entities that exist outside the ledger but must be represented in the ledger in order to interact with it. It suggests that a distributed ledger that contains representations of entities that exist outside the ledger can yield a continuum of interconnected existing and past identities that is constantly redefined to represent new conceptual entities. This continuum can be understood as a metasortal—or a sortal of sortals—that resembles the mathematical structure of a set of sets. Further, the article presents the dilemma that arises when representing the identities of entities in a distributed ledger, and it draws an analogy between this dilemma and Russell's Paradox.

Paweł Szewczyk

No abstract is available for this record.

Kamanashis Biswas, Vallipuram Muthukkumarasamy, Wee Lum Tan

The necessity of wine supply chain traceability system is inevitable due to increase in counterfeiting, adulteration, and use of excessive preservatives and hazardous chemicals. To overcome these issues, wine industry is in need of a traceability system which enables a consumer to verify the composition of each batch of wines from the grape growers to the retailers. However, most of the current systems are RFID and web based and thus it is possible to counterfeit stored information as required. This study proposes a blockchain based wine supply chain traceability system where every transaction is recorded as a block in the chain and is visible to the relevant participants. These blocks of information is immutable since any change to the recorded information will break the chain. In addition to providing quality information management framework, the proposed traceability system enables transparency, safety, and security in the overall process from the grape to the bottle.

Lan Ge, Christopher Brewster, J.C. Spek, Anton Smeenk · 9 authors

This report documents experiences and findings from the public private partnership (PPP) project 'Blockchain for Agrifood' that was started in March 2017. The project aims to contribute to a better understanding of the blockchain technology (BCT) and its implications for agrifood, especially how it can impact specific aspects of supply chains and what is needed to apply BCT in agrifood chains. A second aim of this project is to conceptualise and develop a proof of concept in an application based on a use case concerning table grapes from South Africa where BCT could be applied. This has been done by building a demonstrator that keeps track of different certificates involved in the table grapes supply chain. The code of this demonstrator is published at Github. 1 Furthermore, the project explored issues regarding the relevance, applicability and implications of BCT for the agrifood sector through literature study and stakeholder consultation.

Alessandra Cretarola, Gianna Figà‐Talamanca, Marco Patacca

In recent literature it is claimed that BitCoin price behaves more likely to a volatile stock asset than a currency and that changes in its price are influenced by sentiment about the BitCoin system itself; in Kristoufek [10] the author analyses transaction based as well as popularity based potential drivers of the BitCoin price finding positive evidence. Here, we endorse this finding and consider a bivariate model in continuous time to describe the price dynamics of one BitCoin as well as a second factor, affecting the price itself, which represents a sentiment indicator. We prove that the suggested model is arbitrage-free under a mild condition and, based on risk-neutral evaluation, we obtain a closed formula to approximate the price of European style derivatives on the BitCoin. By applying the same approximation technique to the joint likelihood of a discrete sample of the bivariate process, we are also able to fit the model to market data. This is done by using both the Volume and the number of Google searches as possible proxies for the sentiment factor. Further, the performance of the pricing formula is assessed on a sample of market option prices obtained by the website deribit.com.

Shayan Eskandari, Jeremy Clark, Vignesh Sundaresan, Moe Adham

In this paper, we present Velocity, a decentralized market deployed on Ethereum for trading a custom type of derivative option. To enable the smart contract to work, we also implement a price fetching tool called PriceGeth. We present this as a case study, noting challenges in development of the system that might be of independent interest to whose working on smart contract implementations. We also apply recent academic results on the security of the Solidity smart contract language in validating our codes security. Finally, we discuss more generally the use of smart contracts in modelling financial derivatives.