Purpose This paper aims to provide an overview of recent US Securities and Exchange Commission (SEC) Division of Investment Management staff (“Staff”) guidance related to investment funds registered under the Investment Company Act of 1940 that seeks to provide exposure to cryptocurrencies or cryptocurrency-related products. Design/methodology/approach This paper provides analysis regarding the Staff’s view on registered investment companies that intend to invest in cryptocurrencies or cryptocurrency-related products, including an overview of the questions posed by the Staff with respect to registered investment companies that seek to hold cryptocurrencies or cryptocurrency-related products, which are divided into five categories: valuation, liquidity, custody, arbitrage (for exchange-traded funds) and potential manipulation and other risks. Findings The Staff is asking for additional information from industry participants to fully analyze and evaluate registered investment companies that seek to invest in cryptocurrencies. Practical implications The industry should continue to provide information to the Staff with the short-term goal of fostering an open dialogue and with the long-term goal of launching a registered investment company that invests in cryptocurrencies or cryptocurrency-related products. Originality/value This paper provides practical guidance from experienced lawyers of the Investment Company Act and Securities Act.
Pasu Poonpakdee, Jarotwan Koiwanit, Chumpol Yuangyai, Watchara Chatwiriya
Our global market is emerging transformation strategy that can make the difference between success and failure. Smart contract systems through developments of technological innovations are increasingly seen as alternative technologies to impact transactional processes significantly. Blockchain is a smart contract protocol with trust offering the potential for creating new transaction platforms and thus shows a radical change of the current core value creation in third parties. These results in enormous cost and time savings and the reduced risk for the parties. This study proposed a method to improve the efficiency of distributed consensus in blockchains using epidemic algorithm. The results showed that epidemic protocols can distribute the information similar to blockchain.
Jul 1, 2018·2018 IEEE International Conference on Internet of Things (iThings) and IEEE Green Computing and Communications (GreenCom) and IEEE Cyber, Physical and Social Computing (CPSCom) and IEEE Smart Data (SmartData)
Significant improvements have been made in the way several businesses are conducted due to the influx of blockchain technology, which is a paradigm shift in research these days. Because of the several benefits this technology brings, including scalability, immutability, and the ability to secure data exchange among parties, data transfer becomes easier and simpler between entities. Automobile renting is a major business nowadays. Renting an auto summons numerous frameworks over a chain of procedures - including confirming the lessee's financial status, driving qualifications, accessible vehicle stock and car features. Leasing companies and financiers, however, need to recognize what is happening to the vehicles after the rent is agreed upon. There is also the problem of time consumption, as the traditional car lease process passes through a lot of stages before completion. The blockchain innovation can keep things up to speed with smart contracts. In this paper, we develop a car lease platform that is solely based on blockchain technology. The underlying principle utilized in this system is the smart contract, which is a programmable script that enforces decisions on all transactions made on the system, and also applies penalties to perpetrators. We evaluate the efficiency of our system by measuring the latency and throughput, and make comparisons with other related systems. Results indicate our system outperforms the others.
Jul 1, 2018·2018 IEEE International Conference on Internet of Things (iThings) and IEEE Green Computing and Communications (GreenCom) and IEEE Cyber, Physical and Social Computing (CPSCom) and IEEE Smart Data (SmartData)
Gladstone M. Arantes, Jose Nogueira D'Almeida, Marcio Teruo Onodera, Suzana Mesquita De Borba Maranhao Moreno · 5 authors
This paper describes a proposal for a process of lending, monitoring and evaluating development projects in the Brazilian Development Bank using blockchain technology. After highlighting the difficulties to implement this proposal, this paper also discusses what can be done as a transition process and outlines what have already been done. The proposals increase transparency of public money allocation, simplify manual activities, reduce operational costs and produce data to support aggregate analysis of the benefits arising from the bank's loans.
Objectives Smart e-Forms are a new form of technology that converts complex paperwork to digital forms in an enterprise setting. In the context of the rapidly changing communication channels brought by the move toward a digital innovation environment in the financial industry, this paper examines a smart e-Form solution that can aid effective business communication. Methods Financial services using smart e-Forms are developing multilaterally with the use of electronic documents in both face-to-face and non-face-to-face channels. The electronic document system for enhancing competitiveness in face-to-face environments includes PPR (paperless and process reconstruction) and tablet banking systems, while the distance contract system through mobile banking can be utilized in non-face-to-face environments. Results As a functional document format that includes business logic, smart e-Forms allow various types of data input such as photos, voice recordings, barcode scanning, and e-Signatures through the use of smart devices. This technology has been utilized in implementing paperless services, tablet banking, and distance contract systems for a number of financial institutions, and e-Form technology is being optimized for the latest mobile devices in response to the demands of the financial market. Conclusions The rapid development of smart e-Form technology has played a major role in innovation in the financial sector. This technology improves customer convenience and work efficiency for a diversified financial environment, and the e-Form-based financial service system is becoming more competitive in various ways to lead the Fourth Industrial Revolution.
Financial Technology (Fintech) is one of the fastest developing industries of our time. New company structures are emerging with very innovative features. Recent examples, along with their innovative investment structures, are reflected in startup funding campaigns that use a technology called blockchain. This article targets a broad audience without getting deep into technical, economical or legal jargon. The reason for this approach is to explain the latest activities in fintech, without getting lost in all the technicalities. The authors assume that the general public struggles to keep pace with technical, legal and social media developments and that it is challenging for individuals to orient themselves in the jungle of media overload, fake news, scams and annoying trolls. This article is the second part of a Financial Technology series, discussing funding and organizational structures of new digital companies and blockchain1ventures. This is the second article following, “The Right Path to Funding Decentralized Organizations”2, where we explored the dynamics of financing startups and new entrepreneurships.
Jul 1, 2018·2018 IEEE International Conference on Internet of Things (iThings) and IEEE Green Computing and Communications (GreenCom) and IEEE Cyber, Physical and Social Computing (CPSCom) and IEEE Smart Data (SmartData)
The emerging data-driven techniques have greatly increased the demand for effective data sharing infrastructure, which is our fundamental motivation in designing effective data trade paradigms. One of the critical challenges of data sharing is to achieve a good trade-off between the privacy and data utility. To address this challenge, in this paper we exploit the Blockchain techniques and contract theory to design a Blockchain-based peer-to-peer data trading mechanism. In our proposed mechanism, the data trading is supported by Ethereum Blockhain technique. To effectively capture and regulate the complex interaction between the data aggregators (AGG) and the data owners, we propose a contract theoretic approach to design the smart contract that is the essential component of Ethereum Blockchain. The performance of our proposed Blockchain-enabled data trading mechanism is evaluated.
Bitcoin and other virtual currencies are becoming increasingly important. They are not money but are being used by a growing group of people as a means of payment and investment. Central banks and regulatory authorities have identified risks and see a need for regulation. Regulation areas with a high priority in the EU concern consumer protection, Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT). The EU institutions are currently revamping the AML Directive in order to include virtual currencies for the first time. An international coordination on the regulation of virtual currencies is on the agenda of Finance Ministers and Central Bank Governors of G20 countries.
Real-time gross settlement system (RTGS) is the cornerstone of inter-bank payment business. Spectacular expansion of large-value wholesale payment has forced financial institutions to implement inter-bank payment systems (IBPS) with higher level of throughput, security, and stability. This promising approach to orchestrating IBPS utilizes emerging blockchain technology, which has been successfully harnessed to deliver distributed trust and confidentiality for diverse financial service applications. However, blockchain is not a silver bullet for IBPS, which faces multiple challenges incurred by high value transactions. Financial institutions expect not only a simple migration from traditional RTGS to a blockchain platform, but a decentralized system with better confidentiality, instruction settlement finality, liquidity saving mechanism, and more efficient methods of gridlock resolution. In this paper, we introduce an end-to-end IBPS prototype based on Hyperledger Fabric enterprise blockchain platform. The prototype supports gross settlement, gridlock resolution, and reconciliation for inter-bank payment business. As a preliminary research of Ubin Project, this prototype is proved to provide higher level of payment settlement service.
Yan Zhu, Yao Qin, Zhiyuan Zhou, Xiaoxu Song · 6 authors
Digital asset management (DAM) has increasing benefits in booming global Internet economy, but it is still a great challenge for providing an effective way to manage, store, ingest, organize and retrieve digital asset. To do it, we present a new digital asset management platform, called DAM-Chain, with Transaction-based Access Control (TBAC) which integrates the distribution ABAC model and the blockchain technology. In this platform, the ABAC provides flexible and diverse authorization mechanisms for digital asset escrowed into blockchain while the blockchain's transactions serve as verifiable and traceable medium of access request procedure. We also present four types of transactions to describe the TBAC access control procedure, and provide the algorithms of these transactions corresponding to subject registration, object escrowing and publication, access request and grant. By maximizing the strengths of both ABAC and blockchain, this platform can support flexible and diverse permission management, as well as verifiable and transparent access authorization process in an open decentralized environment.
Jul 1, 2018·2018 IEEE International Conference on Internet of Things (iThings) and IEEE Green Computing and Communications (GreenCom) and IEEE Cyber, Physical and Social Computing (CPSCom) and IEEE Smart Data (SmartData)
We present a distributed ledger application for the world of citizen philanthropy and social entrepreneurship, with stakeholder incentives designed to increase social good through accountability, transparency, and flexibility. In this system, called Directed Cash, individual donors specify conditions (the “Directed” part) attached to their donation or investment (“Cash”), that are then efficiently paired with interested recipients or aggregators of recipients (charities, social entrepreneurs) using distributed consensus so that the intent and pairing are open while maintaining donor anonymity. Furthermore, Directed Cash flows both ways to promote accountability and transparency: after receipt, a validation flows backwards to return to the donor so that the donor receives a report of how their donation was spent. While some elements of the system borrow from existing cryptocurrency and blockchain technologies, we propose alternative incentives for distributed consensus that are better aligned with the application and promote social good through the stakeholders. This paper describes the goals and concepts, and a system design to achieve these goals, a primary feature of which is a simple SQL-like language to enable specifying conditions, pairing, aggregation and publicly-verifiable reporting.
Rohith P. George, Brad L. Peterson, Oliver Yaros, David L. Beam · 6 authors
Purpose To introduce blockchain in simple terms for business lawyers to be able to spot the right issues and ask the right questions. Design/methodology/approach This article provides an overview of blockchain, identifies two example use cases, and highlights some of the most pressing legal issues, including issues to address in on-chain programming, off-chain agreements and other issues when determining whether to implement a blockchain solution. Findings This article concludes that there has been a significant growth in investment and interest in blockchain. Numerous companies across different sectors have developed blockchain proof-of-concepts, with some heading towards production deployments. At this point, commercial blockchain is largely in the pilot or proof-of-concept stage across a wide range of use cases, with payments and supply chain being two of the most promising use cases. This article also identifies possible legal issues associated with blockchain. Practical implications Despite the growing interest in blockchain, it is still a novel topic to many business lawyers. It is very important that lawyers are able to identify the right issues and ask the right questions. Originality/value Practical guidance from experienced lawyers in the Technology Transactions and Financial Services Regulatory & Enforcement practices.
Jul 1, 2018·2018 IEEE International Conference on Internet of Things (iThings) and IEEE Green Computing and Communications (GreenCom) and IEEE Cyber, Physical and Social Computing (CPSCom) and IEEE Smart Data (SmartData)
Muskan Vinayak, Har Amrit Pal Singh Panesar, Saulo dos Santos, Ruppa K. Thulasiram · 6 authors
The recent advancement in Blockchain technology and cryp-tocurrencies like Bitcoin and Ethereum has captured interest of many researchers in academia and industry. Since its advent, the Blockchain was inherently supposed to be used in combination with cryptocurrencies but currently this technology is being used in other areas as well. One particular area based on the distributed ledger technology that has grabbed the attention of many technologist and financial marketers is “Smart Contracts”. Based on a cryptocurrency framework known as Ethereum, these smart contracts can be used for different applications such as Option Pricing, Currency Exchange, Revenue Management System, Crowd-funding and Peer-to-Peer networking. In our current effort, we have designed a smart contract and demonstrate that this smart contract could be used to take various possible positions in an European style option. We have analyzed the contract for potential security vulnerabilities when implemented in Blockchain. These option based smart contracts could be used for collateral contract services among finance industries.
Jul 1, 2018·2018 IEEE International Conference on Internet of Things (iThings) and IEEE Green Computing and Communications (GreenCom) and IEEE Cyber, Physical and Social Computing (CPSCom) and IEEE Smart Data (SmartData)
Poverty alleviation loan plays an important role in the poverty alleviation strategy of China. To improve the loan service efficiency and reduce service cost, it is necessary to build a management system for this business. However, current management systems for the loan are usually deployed in single service mode, also the transactions are not transparent and traceable to most of the roles participating in the process. Its data privacy protection mechanism is not robust enough facing various cyber attacks. To overcome these challenges, we propose loan on blockchain (LoC), a novel poverty alleviation loan management system based on smart contracts. A digital account model is designed for the transfer of assets between centralized and decentralized ledgers, and locking and unlocking algorithms are introduced for smart contracts. Digital signature and oracle are introduced to protect the data privacy.
Jul 1, 2018·2018 IEEE International Conference on Internet of Things (iThings) and IEEE Green Computing and Communications (GreenCom) and IEEE Cyber, Physical and Social Computing (CPSCom) and IEEE Smart Data (SmartData)
Yan Zhu, Xiaoxu Song, Shuai Yang, Yao Qin · 5 authors
While smart contracts are praised widely, it should be noted that they have their disadvantages: lack of control over data protection and executive correctness or consistency. Aiming at this problem, we propose SMPC-based smart contract platform with three-layer structure: contract, computing, and group communication layer. In contract layer, we put forward SMPC-based smart contract framework, which gives the implementation process, language structure and grammar specification of smart contracts. In computing layer, fair SMPC algorithms based on general linear secret sharing scheme are designed to implement verifiable collaboration computing with input privacy and computation correctness. In group communication layer, the non-blocking broadcast is developed from non-blocking message passing interface (MPI)in order to ensure secure group communication in asynchronous networks with node and link failures. Finally, the results of simulation experiments with private currency transfers indicate that our platform is efficient and secure enough for common smart contracts.
This Article, which takes into account developments up until summer 2017, evaluates the early days of regulatory engagement with blockchain technology. My analysis unfolds in three parts. First, I provide a cursory overview of the technology itself to highlight considerable uncertainties concerning its future. Regulators asked to engage with distributed ledgers are thus compelled to regulate the unknown. Second, I will introduce a typology of regulatory strategies adopted to date and highlight their respective advantages and shortcomings. Third, I will outline a number of guiding principles regulators should follow in respect of blockchain technology. I will make the argument that despite the technology's uncertain future, early regulatory engagement is warranted as a young technology is a malleable technology. As technology develops, law has to adapt. As a consequence, I put forward a number of regulatory techniques, including a process of polycentric co-regulation that relies on the regulatory potential of (blockchain) software and the adoption of a so-called “28 th regime” at the EU level which may help navigate the uncertainties of blockchain development and regulation.
C. Kouzinopoulos, Konstantinos M. Giannoutakis, Konstantinos Votis, Dimitrios Tzovaras · 10 authors
The H2020 European research project Safe-Guarding Home IoT Environments with Personalised Real-time Risk Control (GHOST) aims to develop a cyber-security layer on IoT smart home installations. The proposed system analyses packet-level data flows for building patterns of communications between IoT devices and external entities. To ensure non-repudiation, integrity and authentication of the data captured, they are stored in a Blockchain, a distributed ledger network, as digitally-signed transactions. Since the data can potentially include sensitive user information, it is imperative to promote trust by informing users about the operating principles of the network as well as to request the acceptance of a consent form by them. This paper presents the design and implementation of a Forms of Consent application, a Distributed Application that interacts with a set of Smart Contracts deployed on a private Ethereum network. The application is being developed as part of the GHOST project.
Haneffa Muchlis Gazali, Che Muhamad Che Muhamad Hafiz Bin Che Hafiz Ismail, Tamrin Amboala
The explosion of virtual currency investment has hit the financial system and brought the cryptocurrency to the global spotlight in recent years. Hitherto, no research has yet systematically investigated the factors that influencing users' intention to invest in cryptocurrency. Thus, this study is aimed to develop an understanding regarding cryptocurrency investment by investigating the intention to invest in cryptocurrency; in this case is Bitcoin. This paper is a conceptual paper that extends the applicability of Theory of Reason Action (TRA) by incorporating perceived risk and perceived benefits as the additional variables from cryptocurrency investment context. Being limited to conceptual evidence, this study lacks the empirical evidence. Future works are needed to be done to establish the empirical support on the association of the studied variables.
Trading commercial property currently involves several middlemen who are extra time-consuming and cost-consuming elements in a transaction. With recent blockchain-based smart contract innovations, it is possible to use distributed applications (Dapps) for disintermediating third parties and enabling direct peer-to-peer (P2P) transactions. The blockchain serves as an immutable, event-recording ledger that facilitates trust-less P2P transactions. The Evareium system is a distributed application for enabling blockchain-based commercial-property trades that make middlemen superfluous and consequently, investors benefit from cost reductions, faster transaction times, greater transparency and reduced regulatory burdens. As a consequence of the Evareium system, investors and other stake-holders are able to avail a direct interface with the creation and dissemination of optimal financial gains from such investments without interdiction. The corresponding Evareium token is structured for governing platform-related incentives. The Evareium token is also intended for Internet-of-Things (IoT) based hotelmanagement services such as controlling hotel-room blindfolds, A/C, smart keys, checkin, spa, restaurant, room service, and so on.
Jul 1, 2018·2018 IEEE International Conference on Internet of Things (iThings) and IEEE Green Computing and Communications (GreenCom) and IEEE Cyber, Physical and Social Computing (CPSCom) and IEEE Smart Data (SmartData)
The idea to digitally facilitate contract law and business practices through computer programs has led to the notion of smart contracts. Today's most prominent smart contract ecosystem is Ethereum, a blockchain based distributed computing platform. Due to the inherent nature of blockchain based contract execution, missing low level programming abstractions, and the constant evolution of platform features and security considerations, writing correct and secure smart contracts for Ethereum is a difficult task. Based on a Multivocal Literature Research and an analysis of the gathered data based on qualitative research methods, we mined a number of design patterns providing design guidelines. We describe those patterns in detail and provide exemplary code for better illustration. Our research shows that the patterns are widely used to address application requirements and common problems. We expect generalizability of some or all of the patterns for other smart contract ecosystems, but this is outside of the scope of this study, which studied only smart contract patterns in Ethereum.