After the global financial crisis 2008, the world has been putting more effort in tightening banking and financial activities with stricter regulations. However, the effectiveness of this policy has remained controversial as many people believe that policy makers should promote freedom and transparency by empowering the public to directly interfere and change the system for public interest. This article attempts to synthesize and analyze available information with a focus on the role of blockchain, a financial tool that can potentially play an important role in the sustainable development of the global economy. The new technology is expected to bring massive benefits to consumers, to current banking system and to the whole society in general.
Marco Conoscenti, Antonio Vetrò, Juan Carlos De Martin
In the Internet of Things (IoT) scenario, the block-chain and, in general, Peer-to-Peer approaches could play an important role in the development of decentralized and dataintensive applications running on billion of devices, preserving the privacy of the users. Our research goal is to understand whether the blockchain and Peer-to-Peer approaches can be employed to foster a decentralized and private-by-design IoT. As a first step in our research process, we conducted a Systematic Literature Review on the blockchain to gather knowledge on the current uses of this technology and to document its current degree of integrity, anonymity and adaptability. We found 18 use cases of blockchain in the literature. Four of these use cases are explicitly designed for IoT. We also found some use cases that are designed for a private-by-design data management. We also found several issues in the integrity, anonymity and adaptability. Regarding anonymity, we found that in the blockchain only pseudonymity is guaranteed. Regarding adaptability and integrity, we discovered that the integrity of the blockchain largely depends on the high difficulty of the Proof-of-Work and on the large number of honest miners, but at the same time a difficult Proof-of-Work limits the adaptability. We documented and categorized the current uses of the blockchain, and provided a few recommendations for future work to address the above-mentioned issues.
In this paper, we engage in a philosophical investigation of how blockchain technologies such as cryptocurrencies can mediate our social world. Emerging blockchain-based decentralised applications have the potential to transform our financial system, our bureaucracies and models of governance. We construct an ontological framework of “narrative technologies” that allows us to show how these technologies, like texts, can configure our social reality. Drawing from the work of Ricoeur and responding to the works of Searle, in postphenomenology and STS, we show how blockchain technologies bring about a process of emplotment: an organisation of characters and events. First, we show how blockchain technologies actively configure plots such as financial transactions by rendering them increasingly rigid. Secondly, we show how they configure abstractions from the world of action, by replacing human interactions with automated code. Third, we investigate the role of people’s interpretative distances towards blockchain technologies: discussing the importance of greater public involvement with their application in different realms of social life.
The blockchain technology underlying Bitcoin and other cryptocurrencies is attracting growing interest. This column argues that if transactions facilitated by this technology become per-vasive, it will have implications for the conduct (and success) of central bank monetary policy. Central banks should embrace the technologies that underpin cryptocurrencies, or risk being cut out from intermediation and surveillance and also risk payment service providers moving to other currency areas with an institutional environment that is more appealing for buyers and sellers.
Juri Mattila, Timo Seppälä, Catarina Naucler, Riitta Stahl · 7 authors
To encourage public discourse on blockchain use case development, this paper provides a pragmatic view on how to develop and to describe blockchain use cases. We approach the issue by developing a tentative use case for autonomous machine-to-machine transactions of electricity in a housing society environment through an iterative process with stakeholders in the energy industry. We proceed by evaluating the outlined concept and its technical specifications against six criteria for a sensible blockchain use case, as identified by blockchain industry specialists. Finally, we conclude with observations and discussion on the use case development process, and its future steps.
Blockchain is a decentralized transaction and data management technology developed first for Bitcoin cryptocurrency. The interest in Blockchain technology has been increasing since the idea was coined in 2008. The reason for the interest in Blockchain is its central attributes that provide security, anonymity and data integrity without any third party organization in control of the transactions, and therefore it creates interesting research areas, especially from the perspective of technical challenges and limitations. In this research, we have conducted a systematic mapping study with the goal of collecting all relevant research on Blockchain technology. Our objective is to understand the current research topics, challenges and future directions regarding Blockchain technology from the technical perspective. We have extracted 41 primary papers from scientific databases. The results show that focus in over 80% of the papers is on Bitcoin system and less than 20% deals with other Blockchain applications including e.g. smart contracts and licensing. The majority of research is focusing on revealing and improving limitations of Blockchain from privacy and security perspectives, but many of the proposed solutions lack concrete evaluation on their effectiveness. Many other Blockchain scalability related challenges including throughput and latency have been left unstudied. On the basis of this study, recommendations on future research directions are provided for researchers.
Blockchain — also referred to as distributed ledger — is currently one of the most discussed topics in the financial world. It has attracted a lot of interest from banks, exchanges and other players in the securities industry. They are increasingly taking this technology seriously and realising its potential to cause disruption to existing transaction processing. This may bring various benefits in terms of settlement and transaction speed, operational efficiency, transparency and cost reduction. However, a topic that is still under-exposed in the discussion around blockchain is what the future post-trade market infrastructure will look like, as well as the roles of the various players in the securities industry in a blockchain environment.
Bitcoin is a decentralised currency and payment system that seeks to eliminate the need for trusted authorities. It relies on a peer-to-peer network and cryptographic protocols to perform the functions of traditional financial intermediaries, such as verifying transactions and preserving the integrity of the system. This article examines the political economy of Bitcoin, in light of a recent dispute that divided the Bitcoin community with regard to a seemingly simple technical issue: whether or not to increase the block size of the Bitcoin blockchain. By looking at the socio-technical constructs of Bitcoin, the article distinguishes between two distinct coordination mechanisms: governance by the infrastructure (achieved via the Bitcoin protocol) and governance of the infrastructure (managed by the community of developers and other stakeholders). It then analyses the invisible politics inherent in these two mechanisms, which together display a highly technocratic power structure. On the one hand, as an attempt to be self-governing and self-sustaining, the Bitcoin network exhibits a strong market-driven approach to social trust and coordination, which has been embedded directly into the technical protocol. On the other hand, despite being an open source project, the development and maintenance of the Bitcoin code ultimately relies on a small core of highly skilled developers who play a key role in the design of the platform.
The purpose of this thesis was firstly to illustrate the different views that banks and traditional institutions have on most potential blockchain use cases compared to the views of fintech companies, secondly find out how the blockchain technology could change the competitive environment in financial markets, and thirdly, give the reader a perspective of the potential of blockchains by introducing several use cases that financial institutions and fintech companies are doing research on. \nWe found out that banks have a positive view on permissioned blockchains due to their more congruent design with existing systems. Also the security and legal issues were seen easier to solve in permissioned blockchains. The fintech companies on their half focused on permissionless blockchains, especially the Bitcoin blockchain. This is a more economical and faster way to create blockchain-based applications. \nBanks’ view is that the technology works best in sectors where the amount of trust between parties is low, there are unnecessary intermediaries, cross-border payments or other barriers for efficiency. Additionally, the blockchains were seen to have biggest potential in markets where the volumes are relatively low. Trade finance, derivatives markets and post-trade settlement are examples of sectors that banks seem to have most attention on at the moment. \nFintech companies, on their half, seem to develop blockchain applications for all kind of environments. This sector was significantly more ambitious and optimistic on the new technology. Legal issues or restrictions of the technology weren’t seen that big of a problem. The fintech companies seemed to have strong faith that these issues will be solved in the future. \nBlockchain technology might enable a situation where need for trusted central counterparties (banks) is eliminated. Also the fintech companies might drag banks’ business towards themselves. At the moment banks are in good positions as they play a major role in societies and have the resources needed to acquire promising fintech companies. In case there’s cooperation in the banking sector and the banks utilize the expert workforce they can gain from the fintech buyouts, they are likely to make their functioning more efficient and will create new profit pools. Anyhow, if they fail to keep up with the development, it’s easy to see them losing, at least partly, their business to new entrants. All depends of the actions that the banking industry takes in the near future.
Blockchain and distributed ledger technology have been the subject of major hype in 2016. Businesses across many industries are considering the potential benefits of this technology - a trusted and immutable record shared across parties through a tamperproof network, potentially reducing costs, increasing automation and removing manual processing. Many businesses are already investing considerable time and money into the technology, particularly in financial services.
Abstract During the last decade, the development of Information and Communication Technologies (ICT) has led the world into a new era of innovative technologies that can provide effective responses to human concerns. In developed countries, the profitability motivation has imposed Service‐Oriented Architectures (SOA) in enterprises as a better way to design information systems capable of taking into account inter‐organizational cooperation mechanisms while preserving autonomy of the latter. Those Service‐Oriented Architectures did not stop at the doors of public administrations. Thus, several specifications have been made to adapt them to the peculiarities of public governance. But these models are not always able to respond effectively to the concerns of governments in developing countries particularly when they are structurally and territorially decentralized. Therefore, we propose a more suitable model to this type of e‐governance. We will later see how our model can be more suitable for the organization of remote and secured fairground courts in Cameroon to address constraints related to finance, time and security that these courts currently impose.
This paper explores the emerging technology of blockchain, the technology that underpins Bitcoin and other cryptocurrencies looking at what the technology is and its potential to disrupt and transform the financial services industry. It highlights the technology's characteristics and explains why these can have a profound impact on the entire financial sector in areas ranging from settlements, payments and identity services, as well as creating new products based on for example ‘smart contracts’. It will give readers an idea of what stage the technology is at—at the top of the Gartner hype cycle and therefore due to enter the ‘trough of disillusionment’ before useful applications start to emerge. The paper also highlights the work that the industry needs to do to make blockchain applications a mainstream part of the financial landscape. It stresses that this is not a technology that a single organisation can hope to perfect to gain an advantage over rivals. Rather, it can help the entire industry by speeding up transactions and making them more secure. But its full potential can only be realised if there is widespread collaboration throughout the sector to explore applications and create common standards.
Blockchain technology has emerged as a solution to consistency problems in peer to peer networks. By now, it has matured as a solution to a range of use cases in which it can effectively provide the notion of third party trust without the need for a trusted (physical) third party, which makes it an attractive coordination mechanism for distributed systems. To promote the wide adoption of this technology, we yet lack mechanisms that make the specification and interpretation of smart contracts accessible to a broader audience. In this work, we propose a modeling approach that supports the semi-automated translation of human-readable contract representations into computational equivalents in order to enable the codification of laws into verifiable and enforceable computational structures that reside within a public blockchain. We identify smart contract components that correspond to real world institutions, and propose a mapping that we operationalize using a domain-specific language in order to support the contract modeling process. We explore this capability based on selected examples and plot out directions for future research on smart contracts.
…the more it is adopted by a mass of users, the more it is secured (Counterparty). Inwieweit, ob und welche Kryptowährung schlussendlich langfristig weltweit akzeptiert wird, ist Thema zahlreicher und vielfältiger Diskussionen. Innerhalb der verschiedenen Kryptowährungen hat das Bitcoin‐System eindeutig einen massiven Vorsprung. Vorstellbar ist jedoch auch analog des Konzepts des freien Wettbewerbs unter den Währungen vom österreichischen Ökonomen Friedrich August von Hayek ein Nebeneinander verschiedenster Kryptowährungen. Jeder dieser Kryptowährungen könnte ein Wert durch eine Gruppe von Menschen, die sich dafür entscheiden, dieser Währung zu vertrauen, beigemessen werden. Diese Gruppe kann durch gemeinsame demografische, geografische oder ethische Interessen definiert werden. Damit Kryptowährungen jedoch von der breiten Öffentlichkeit genutzt werden, bedarf es noch Vor allem aber braucht es Akzeptanz und Nutzung der Kryptowährungen in der breiten Öffentlichkeit und hier liefert die Gratis‐Bitcoin‐Ökosphäre, bestehend aus Hunderten Faucet‐Webseiten, einen großen Beitrag.
Talent hits a target others cannot hit, Genius hits a target others cannot see (Arthur Schopenhauer). Bereits 2013 begannen sich neue Kryptowährungsunternehmen zu formieren, die sich von der Wild‐West‐Mentalität der Mt. Gox und der Silk Road abgrenzen wollten. Die entstehenden Kryptowährungsdienstleister – großteils finanziert von US Venture Capital-Gebern – unterwerfen sich teils freiwillig den Know Your Customer (KYC) Bestimmungen der Finanzaufsichtsbehören. Gleichzeitig entstanden Kryptowährungsstartups, deren Gründer die Meinung vertraten, dass eine Kooperation mit den Finanzinstituten bzw. den Fiatwährungen statt Konfrontation wirtschaftlich sinnvoller wäre und damit begannen, neue Kryptotransaktionssysteme mit dieser Zielrichtung zu entwickeln (beispielsweise Ripple Lab vgl. auch Abschn. 14.2.). Zeitgleich – auch hier spielten die Interessen der investierten Venture-Capital-Geber eine wichtige Rolle – begannen Startups intensiv am Einsatz des Bitcoin‐Transaktionssystems für alternative Zwecke zu arbeiten. Dabei wird unterschieden in:
Die Möglichkeit der Programmierbarkeit des Bitcoins ist fast ein nachträglicher Einfall, auch wenn Sidechain‐Vorschläge diese Programmierbarkeit ein wenig leichter machen wollen und es bereits Altcoins mit verschiedenen spezifischen Anwendungen gibt. Im Gegensatz dazu wurde das Kryptowährungstechnologieprojekt Ethereum von Vitalik Buterin, seinem Erfinder, von Tag 1 als Software‐Entwicklungsplattform für dezentrale Applikationen konzipiert, und ihre Blockchain wurde speziell entwickelt, um die Ausführung dieser dezentralen Apps (auch Dapps genannt) zu unterstützen. Vitalik Buterin, 1994 in Russland geboren, war vor der Gründung von Ethereum auch involviert in die Entwicklungsprojekte Colored Coins und Mastercoins. Er gewann 2014 den "World Technology Award" und ein Stipendium des Risikokapitalgebers Peter Thiel. In dem Diskussionspapier zu Ethereum skizzierte Buterin vor allem die Grenzen einer Programmierbarkeit der Bitcoin‐Blockchain und schlug die Erstellung einer neuen komplett programmierbaren Blockchain mit einer turing‐vollständigen Programmiersprache vor. Anders als andere Blockchain‐Projekte soll die Ethereum Software nicht nur für einen Zweck nutzbar sein – sondern soll die Basis für die Erarbeitung aller möglichen Arten von Lösungen sein und dabei die Umsetzung intelligenter Verträge (Smart Contracts) ebenso erfassen als auch die Ethereum‐spezifische Idee von dezentralen autonomen Organisationen (DAOs).
We present a novel institutional perspective on the distributed consensus and ledger technology known as blockchain. We discuss the concept of Distributed Autonomous Institutions that are able to facilitate global interactions, contracts, and value transfers, all of which are achieved without the need for the human-based third party trust. We argue that due to its properties and design blockchain technology represents a disruptive change in the modelling paradigms of socio-technical systems. Distributed trust and consensus mechanisms offered by blockchain technology represent a novel, qualitatively different, phenomenon. We present the general design principles, stakeholders, the dynamics between those stakeholders, the incentive models, and the consensus protocols currently used in blockchains, before highlighting the potential of blockchain technology to develop distributed autonomous institutions. We conclude with a discussion of challenges associated with the adoption of blockchain technology.
DT X is building a next generation model from the grassroots of infrastructure Telecommunications 4.0 to IOT, Industry 4.0, Education 4.0 and financial services (Banking 4.0) leveraging Distributed Ledger technology. (Going beyond code and blockchain.)
The aim is to empower and beyond traditional and rational projects by targeting the sore points globally, opposed to the tradition proposals and whitepapers of a target market of 2 billion people who currently don’t have access to banking across the world.
DT X is based over four years of trials and errors of sub projects to evaluate the conditions and possible prospects, which in each and every time fall back to National Infrastructure and resources which varies from country to country: Telecommunications, Energy, Financial Services (Fintech & Regulation), Available Funding, Economic Stimulation, Education and Blockchain adoption & use cases.
Instead of promoting specific problems and identifying alternative underlying issues DT X is targeting the core root of the issue then apply by layers solutions to solve specific requirements.
Western world application will be focused on a similar model of Africa but more evolved around Telecommunication infrastructure merged with Distributed Ledger Technology over its own Network on a national scale thus securing all information and providing Industry 4.0 the infrastructure to grow and create economic growth whilst supporting Fintech, Education and Public or Private services.
Rainer Schmidt, Michael Möhring, Daniel Glück, Ralf Haerting · 6 authors
Bitcoin is the most successful approach for establishing a currency outside of state supervision and government institutions. Besides, Bitcoin is very controversial discussed. Therefore, a further investigation of different aspects of the benefit of using Bitcoin should be realized in order to identify some core aspects of the digital currency Bitcoin. In this context, the study described in the following achievements is done. It shows that there exist key aspects, like dissemination as well as safety, which are important impact factors on users' benefit of using a digital currency like Bitcoin. In addition, it also gives implications for a further development of the topic and aspects for future research.
Christopher D. Clack, Vikram A. Bakshi, Lee Braine
In this position paper, we consider some foundational topics regarding smart\ncontracts (such as terminology, automation, enforceability, and semantics) and\ndefine a smart contract as an automatable and enforceable agreement. We explore\na simple semantic framework for smart contracts, covering both operational and\nnon-operational aspects, and describe templates and agreements for\nlegally-enforceable smart contracts, based on legal documents. Building upon\nthe Ricardian Contract, we identify operational parameters in the legal\ndocuments and use these to connect legal agreements to standardised code. We\nalso explore the design landscape, including increasing sophistication of\nparameters, increasing use of common standardised code, and long-term research.\n
Bitcoin has been identified as capable of providing a feasible solution to transfer money 'home' safely in a cost-effective manner for many, including for migrant workers. Notwithstanding the potential perks (efficiency, low cost, absence of foreign exchange problems), there are many pitfalls for potential users of bitcoin for this purpose, given the general absence of regulatory protections. Providing protection for users of bitcoin for this purpose is complicated by broader regulatory concerns such as money-laundering and terrorism-financing. This paper will point to the perks and pitfalls of the use of Bitcoin in remittance and concludes that it has rich potential in that arena, and that the regulatory framework for the use of Bitcoin in the remittance sector provides moderate protection for Australian users.
Financial technology (FinTech) is becoming more popular in Japan (as well as globally), and financial institutions are increasingly seeking to collaborate with the firms providing such technology. Among FinTech, blockchain (distributed ledger) technology is attracting particular attention because of the possibilities it offers, most notably as a powerful new tool for facilitating transactions. This paper provides an overview of this new technology, including its potential contribution to the infrastructure of the securities market, and provides an introduction to the role of blockchain in financial transactions. This technology is innovative and improving very rapidly. Nevertheless, any enterprise looking to adopt blockchain technology will need to update their business processes and maintain ongoing discussion with stakeholders. The author suggests that only 20 per cent of the barriers to adoption are technology based, the other 80 per cent being attributable to current business processes and business models. It is necessary to take the time to utilise and apply blockchain technology in financial markets. It will take more than a couple of years for blockchain technology to be fully deployed within the financial infrastructure, but it should take less than a decade.
Asaph Azaria, Ariel Ekblaw, Thiago Augusto Vieira, Andrew Lippman
Years of heavy regulation and bureaucratic inefficiency have slowed innovation for electronic medical records (EMRs). We now face a critical need for such innovation, as personalization and data science prompt patients to engage in the details of their healthcare and restore agency over their medical data. In this paper, we propose MedRec: a novel, decentralized record management system to handle EMRs, using blockchain technology. Our system gives patients a comprehensive, immutable log and easy access to their medical information across providers and treatment sites. Leveraging unique blockchain properties, MedRec manages authentication, confidentiality, accountability and data sharing- crucial considerations when handling sensitive information. A modular design integrates with providers' existing, local data storage solutions, facilitating interoperability and making our system convenient and adaptable. We incentivize medical stakeholders (researchers, public health authorities, etc.) to participate in the network as blockchain “miners”. This provides them with access to aggregate, anonymized data as mining rewards, in return for sustaining and securing the network via Proof of Work. MedRec thus enables the emergence of data economics, supplying big data to empower researchers while engaging patients and providers in the choice to release metadata. The purpose of this short paper is to expose, prior to field tests, a working prototype through which we analyze and discuss our approach.