Youssef Faqir-Rhazoui, Miller-Janny Ariza-Garzón, Javier Arroyo, Samer Hassan
Blockchain technology has enabled a thriving emergent ecosystem of tools and communities actively using decentralized systems. However, most blockchain infrastructure (e.g. Ethereum) requires users to pay some fees to execute their desired actions in these novel online services. To which extent an increase in the price of such fees negatively affects user activity? Would significant price surges deter users from using blockchain-enabled online services? In this work, we study the 2020 surge of transaction fee price in the Ethereum network, and analyze how that affected user activities. Our use cases are the blockchain-enabled Decentralized Autonomous Organizations (DAOs) from the platforms DAOstack and DAOhaus. Thus, we analyzed 5,580 transactions from 7,825 users grouped in 191 DAO communities, using a VAR model with a daily time series of the average fee value and the DAO operations. Our results show just a minor influence of the fee (gas) price and the activity of DAO users. The insensitivity of the activity to the fee price is an anomaly in a supposedly self-regulated market, and we consider this should be tackled in future implementations.
Digital platform as an organising logic has prominently reshaped the innovation activities in many sectors. Previous studies have extensively investigated the digital platforms from two views: economic view (i.e., as a sided marketplace) and engineering view (i.e., as an innovation infrastructure). Blockchain---a digital artefact that connects the distributed ledgers, resembles great overlaps and specifics to digital platforms. Building on this aspect, I first demarcate the Blockchain Product as a Platform (BPaaP) informed by the economic view and the Blockchain Network as a Platform (BNaaP) inspired by the engineering view. Given the scant of research around BNaaP, this research aims to depict the BNaaP’s architectural design by drawing on the layered design of digital technologies. Using PingAn Group as a case, this research applies the thematic analysis method in analysing online open data. As the main contribution, this research proposes the Adapted Layered Architecture of BNaaP that consists of 1) three design layers(foundation layer, interaction layer, and application layer); 2) adapted business scenarios; 3) environmental factors. The suggested architectural design implies the BNaaP’s internal synergistic collaboration among layers and the external adaptability to different business contexts. Overall, this research provides a novel angle to understand the Blockchain phenomenon and brings insightful implications to Blockchain practitioners.
The purpose of this study is to analyze the contents of cryptocurrency value design based on adaptability to the current market. It is also intended to provide a method of issuing cryptocurrency before its creation, and an operation method afterwards. Activities before the creation of cryptocurrency must determine desirable behaviors and rewards to create value, and suggest countermeasures to prevent participants from engaging in undesirable behaviors. After the creation of a cryptocurrency, it is necessary to propose a method to induce scarcity and increase demand so that the value of the generated cryptocurrency can be sustained. To observe this, we looked at the contents of the value design of the eight types of cryptocurrencies currently in use in the market. Some cryptocurrencies, such as Bitcoin, are choosing mining as a reward, to secure scarcity for maintaining the value of cryptocurrency, limiting the amount of issuance, and burning the already issued cryptocurrency in the market. Also, increasing demand helps maintain the value of cryptocurrency. This study can contribute to supporting the growth of a healthy cryptocurrency market through cryptocurrency-related research.
As the internet is becoming more accessible and convenient, larger numbers of people and businesses are shifting towards digital transactions. Digital payment methods are quicker, cheaper and much more efficient. Therefore, it's not surprising that newer forms of digital payment systems are rapidly being developed. When compared no other method comes even close to the giant that is cryptocurrency. Cryptocurrencies like Bitcoin and Ethereum are among the most popular forms of digital payments. Cryptocurrencies could be popularized in India as a viable option for digital currency, but it has both pros and cons which need to be acknowledged. Through the means of literature review, this research paper will analyze the cryptocurrency, its working and perform a comparative study between China and India. Alos, it considers the current status as well as the scope of cryptocurrency in India.
A smart contract is a technology that allows the creation of a negotiation process capable of running independently, without human intervention. This chapter intends to frame the figure of the “smart contract” from a legal point of view. It shows that the smart contract is an advanced tool in the context of a contractual relationship. The possibility of making a smart contract “the contract” in a legal meaning opens up scenarios which have hitherto been unexplored for contract law. It is still difficult to determine to what extent current rules are adequate to govern this phenomenon. The chapter will therefore conclude with a review of the strengths and weaknesses of the smart contract technology and with some suggestions for a future smart contract law.
Since its advent in 2009, Bitcoin, a cryptography-enabled peer-to-peer digital payment system, has been gaining increasing attention from both academia and industry. An effort designed to overcome a cluster of bottlenecks inherent in existing centralized financial systems, Bitcoin has always been championed by the crypto community as an example of the spirit of decentralization. While the decentralized nature of Bitcoin's Proof-of-Work consensus algorithm has often been discussed in great detail, no systematic study has so far been conducted to quantitatively measure the degree of decentralization of Bitcoin from an asset perspective -- How decentralized is Bitcoin as a financial asset? We present in this paper the first systematic investigation of the degree of decentralization for Bitcoin based on its entire transaction history. We proposed both static and dynamic analysis of Bitcoin transaction network with quantifiable decentralization measures developed based on network analysis and market efficiency study. Case studies are also conducted to demonstrate the effectiveness of our proposed metrics.
Abstract Smart contracts created to issue tokens and control other digital financial assets on the majority of blockchain platforms require knowledge of programming language for specific platforms. This fact imposes a restriction on attracting financial specialists from conventional markets. This paper presents the concept of a Restricted Move language allowing the users to form a smart contract description in financial English, as well as its further development into a high-level digital asset management language, which can be extended by users and can open new opportunities to automate their market operations.
Anne Sofie Vingerhoets, Samedi Heng, Yves Wautelet
New blockchain-based projects do appear every day. The technology has indeed been popularized by cryptocurrencies but is now gaining interest in various domains and new types of applications are evaluated constantly. Understanding the impact of blockchain adoption on the organization and the internals of blockchain-related behavior nevertheless remains a challenge for managers but also for IT professionals. This article studies how two existing organizational and software modeling languages can be fit to document a blockchain development project in Supply Chain Management (SCM) at its earliest stages. These two frameworks are i* on the one side and the Unified Modeling Language (UML) use case and sequence diagrams on the other side. The real life project used as a case study in this application is ‘Farm-to-Fork’ where a blockchain solution for the Supply Chain (SC) of farm animals is developed. The application of the frameworks is intended to identify their strengths and weaknesses. An extension of i* is proposed to deal with blockchain privacy issues as well as laws and norms. We finally point to the complementarity of i* and UML use case and sequence diagrams in a Blockchain-Oriented Software Engineering (BOSE) context. The i* framework indeed supports early requirements to understand the impact of the project on stakeholders while UML use case and sequence diagrams support the late requirements and the design by depicting the use of blockchain and some of its behavioral mechanisms.
Johannes Rude Jensen, Victor von Wachter, Omri Ross
Decentralized financial applications (DeFi) are a new breed of consumer-facing financial applications composed as smart contracts, deployed on permissionless blockchain technologies. In this article, we situate the DeFi concept in the theoretical context of permissionless blockchain technology and provide a taxonomical overview of agents, incentives and risks. We examine the key market categories and use-cases for DeFi applications today and identify four key risk groups for potential stakeholders contemplating the advantages of decentralized financial applications. We contribute novel insights into a rapidly emerging field, with far-reaching implications for the financial services.
We propose a new way to share licensed spectrum bandwidth capacity in mobile\nnetworks between operators, service providers and consumers using\nblockchain-based smart contracts. We discuss the foundational building blocks\nin the contract as well as various extensions to support more advanced features\nsuch as bulk purchases, future reservations, and various auction mechanisms.\nFurthermore, we demonstrate how the system can be implemented with an\nopen-source, permissioned Enterprise blockchain, Hyperledger Sawtooth. We show\nthat our smart contract implementation can improve blockchain transaction\nperformance, by approximately four orders of magnitude compared to serial\ntransactions and one order of magnitude compared to parallell transactions,\nusing PKI-driven bulk purchases of mobile access grants, paving the way for\nfully automated, efficient, and fine-grained roaming agreements.\n
Abstract The block chain technology enjoys a promising development prospect. As one of the most popular technologies, block chain has been heatedly studied and researched by people from all walks of life. Based on an introduction to the technical background and basic concepts of block chain, by analyzing the technical architecture and working principle of block chain, this paper systematically explains the key technologies of block chain, namely decentralization, proof of work (POW), smart contract and Ethereum, and further discusses the development of the block chain technology, 5G, the Internet of Things and the future wireless network.
Kripto para kavramıyla birlikte kullanım alanı bulan, dijital uygulamalarla iki taraflı şifreleme tekniklerini kullanan ve belli bir merkezin otoritesine bağlı olmadan dolanımda olan para Bitcoin olarak adlandırılmaktadır. Bu çalışmada Bitcoin olarak adlandırılan bu yeni şifrelenmiş paranın dolar ve avro ile olan ilişkisi araştırılmıştır. 28 Ağustos 2011 – 15 Mart 2020 tarihleri arasındaki dönemden oluşan haftalık verilerin kullanıldığı çalışmada ilk olarak Carrion‐i‐Silvestre (2009) birim kök testi ve sonra da Maki (2012) eşbütünleşme testi uygulanarak Bitcoin ve döviz kurları ilişkisi analiz edilmiştir. Elde edilen sonuçlara göre Bitcoin ile hem dolar hem de avro arasında uzun dönemli ve pozitif yönlü bir ilişki tespit edilmiştir. Bu doğrultuda elindeki mevduatını avro ya da dolarda tutan bir yatırımcının sanal piyasalarda Bitcoin’e yatırım yapması riskini minimize ederek portföy çeşitlendirmesi yapmak adına yararlı olmayacaktır.
This paper outlines an approach for IEEE to take leadership for digital privacy to align many existing IEEE Societies and efforts in the areas of computer systems & applications security, organizational & global architectures, policy-supporting legislation, originating new standards, integrating compliance into technologies, and helping design decision-board infrastructures for governance bodies. Much of the current emphasis on evolving privacy technologies centers on big corporate enterprises and institutions, causing the industry to support corporate assets protection mainly. Fostering technology to empower individual privacy-enabling tools has lagged, and personal privacy has diminished because corporate big data applications have made sizable investments into exploiting private data. As one of the largest individual-member-based organizations, IEEE is urged to develop a collaborative approach for digital privacy with privacy-enabling technologies to benefit its members. The recommendations outlined define a prospective course that could result in future global individualized privacy capabilities which employ a combination of synergistic technologies such as distributed ledgers, differential privacy, homomorphic encryption, secure distributed multi-party computation, zero-trust architectures, proof-of-origin of data, software, or other techniques. Such an effort would involve community engagement and outreach, academic peer-review events, the establishment of governance bodies, coordination & expansion of existing standards, and the development of publicly-accessible prototypes. Collaboration with other IEEE-sponsored efforts for transactive energy systems, confidentiality and security of healthcare records and devices, and other IEEE-funded projects will help magnify digital privacy investments already in progress in these applications of emerging technologies.
Cryptocurrencies are revolutionary digital currencies used by people on a peer to peer network. Cryptocurrencies are predominantly used as a payment method in business transactions. However, challenges arise with cryptocurrency borne transactions due to the lack of universal accepted classification of cryptocurrencies, the result of which leads to unintended tax consequences for cryptocurrency users. This article examines the recent amendment to the Value-Added Tax (VAT) 89 of 1991 pertaining specifically to the VAT treatment of cryptocurrencies in South Africa. Currently, transactions in cryptocurrencies are deemed to be financial services in South Africa. This means that a supply of any cryptocurrency in South Africa is exempt from VAT. This article makes a comparison with the Australian legislative framework to determine how cryptocurrencies are treated for VAT/GST purposes in that country. Although the move to regulate cryptocurrencies is welcomed, this article argues that cryptocurrency activities are incorrectly legislated as financial services in the VAT Act.
Blockchain and other distributed ledger technologies have enormous potential for creating business value but have not yet been widely adopted. Enterprise blockchain systems are recognized as solutions to existing operational problems or ‘pain points’ but their potential for delivering value through strategic opportunities is not well understood. Drawing from literature on strategic alliances and the resource-based view of the firm, we identify avenues through which blockchain systems can contribute to a firm’s strategic capabilities and, as a result, to its sustained competitive advantage. We provide a framework for understanding how participation in blockchain solutions can enable companies to build upon existing strategic capabilities, strengthen collaborative capabilities and develop blockchain-specific capabilities. The framework can be useful to firms and service providers for incorporating strategic outcomes into the evaluation of blockchain investment opportunities.
Cryptocurrency is a new economy of transacting value whose use case is undeniable. Its only requirement is to be human, and it is borderless. In Morocco, cryptocurrency is erasing borders and gaining popularity. However, the general public opinion on this new innovation is unclear. This study aims to elucidate the popularity of this technology in the Kingdom by means of a small survey. The present study also investigates areas related to cryptocurrency, such as people's trust in banks. The results from the survey are contrasted with other countries to obtain a global perspective regarding Morocco's placement in the cryptocurrency adoption spectrum. The results also suggest that Morocco has the potential to adopt this technology. Notably, 9% of the sample population claim that they have owned, or still own, some sort of cryptocurrency. However, the country faces legal obstructions and financial restrictions that impede the progress of cryptocurrency adoption.
We build a multi-period pricing model between a blockchain-technology-supported platform and a traditional platform, where the blockchain-technology-supported platform provides a higher value for customers. Customers are influenced by network effect, that is, they value a platform more if the platform has more users. As either platform can adopt static pricing or dynamic pricing, four scenarios may occur. By deriving the equilibrium of each scenario, we reveal the 'Matthew effect' caused by network effect, that platform advantage (from adopting blockchain technology) or disadvantage (from not adopting blockchain technology) accumulates as time goes by. Thus, platforms are advised to adopt the blockchain technology antecedent to the competitors. Network effect, which amplifies the benefit of initial users, may intensify price competition and harm both platforms. By comparing the four scenarios, we derive the equilibrium pricing strategies: when network effect is weak, one platform adopts static pricing and the other adopts dynamic pricing; when network effect is medium, the blockchain-technology-supported platform adopts static pricing and the traditional platform adopts dynamic pricing; and when network effect is strong, both platforms adopt dynamic pricing. Dynamic pricing is more desirable for the traditional platform relative to the blockchain-technology-supported platform.
Yunshu Liu, Zhixuan Fang, Man Hon Cheung, Wei Cai · 5 authors
Miners in a blockchain system are suffering from ever-increasing storage costs, which in general have not been properly compensated by the users’ transaction fees. This reduces the incentives for the miners’ participation and may jeopardize the blockchain security. To mitigate this blockchain insufficient fee issue, we propose a Fee and Waiting Tax (FWT) mechanism, which explicitly considers the two types of negative externalities in the system. Specifically, we model the interactions between the protocol designer, users, and miners as a three-stage Stackelberg game. By characterizing the equilibrium of the game, we find that miners neglecting the negative externality in transaction selection cause they are willing to accept insufficient-fee transactions. This leads to the insufficient storage fee issue in the existing protocol (i.e., deployed in Bitcoin and Ethereum). Moreover, our proposed optimal FWT mechanism can motivate users to pay sufficient transaction fees to cover the storage costs and achieve the unconstrained social optimum. Numerical results show that the optimal FWT mechanism guarantees sufficient transaction fees and achieves an average social welfare improvement of 51.43% or more over the existing protocol. Furthermore, the optimal FWT mechanism reduces the average waiting time of low-fee transactions and all transactions by 68.49% and 61.56%, respectively.
Kontinuiranim razvojem informatičkih tehnologija i interneta intenzivirao se rad na postojećim idejama digitalnog novca. Kao rezultat toga, računalni program Bitcoin protokola je pušten u javnost 9. siječnja 2009. godine čime se kreira infrastruktura za prvu kriptovalutu s licencom otvorenog programskog koda koji je slobodan za javnost. To znači da svatko tko ima interes može replicirati postojeći protokol, kreirati novu kriptovalutu i pustiti u javnost. Ovo posljednje je omogućilo stvaranju niza novih kriptovaluta s različitim svojstvima i širenju njihove upotrebe prvo u platnom prometu, a zatim i u kontekstu njihovog trgovanja na novom sekundarnom tržištu. Cilj ovog rada je formalno identificirati i opisati mogućnost konstrukcije portfelja kreiranih prema različitim optimizacijskim ciljevima, a čije sastavnice predstavljaju kriptovalute kao nova vrsta utržive imovine. Prva skupina portfelja je formirana i modelirana kroz vrijednost bitcoin kriptovalute, a druga skupina kroz dolarsku novčanu jedinicu. U tu svrhu je provedeno pet različitih optimizacijskih strategija, te su i prezentirani rezultati strategije s jednakim udjelima u portfelju. Inicijalne sastavnice portfelja su definirane prema razvoju programskog koda i veličini zajednice. Rezultati portfelja izraženog kroz jedinice bitcoin kriptovalute sugeriraju da dinamika povijesnih prinosa kriptovaluta pruža mogućnost modeliranja portfelja u bitcoin valuti. Takvi rezultati su opravdani s obzirom da je dinamika prinosa optimizacijske strategije ostvarila kumulativni prinos viši od kumulativnog prinosa najuspješnije sastavnice portfelja. S druge strane, rezultati portfelja izraženog u dolarskoj vrijednosti nisu ostvarili kumulativni prinos viši od kumulativnog prinosa odabranog standarda usporedbe, pa se zaključuje da primijenjeni fundamentalni indikatori ne predstavljaju dobar pokazatelj za inicijalan odabir sastavnica portfelja.
Pierre Schutz, Stanislas Gal, Dimitris Chatzopoulos, Pan Hui
Abstract Peer‐to‐peer (P2P) networks utilize centralized entities (trackers) to assist peers in finding and exchanging information. Although modern P2P protocols are now trackerless and their function relies on distributed hash tables (DHTs), centralized entities are still needed to build file indices (indexing) and assist users in joining DHT swarms (bootstrapping). Although the functionality of these centralized entities are limited, every peer in the network is expected to trust them to function as expected (e.g. to correctly index new files). In this work, a new approach for designing and building decentralized online applications is proposed by introducing DIBDApp. The approach combines blockchain, smart contracts and BitTorrent for building up a combined technology that permits to create decentralized applications that do not require any assistance from centralized entities. DIBDApp is a software library composed of Ethereum smart contracts and an API to the BitTorrent protocol that fully decentralizes indexing, bootstrapping and file storing. DIBDApp enables any peer to seamlessly connect to the designed smart contracts via the Web3J protocol. Extensive experimentation on the Rinkeby Ethereum testnet shows that applications built using the DIBDApp library can perform the same operations as in traditional back‐end architectures with a gas cost of a few USD cents.