Abstract
In this article, we model the two most market-capitalised public, open and permissionless blockchain implementations, Bitcoin (BTC) and Ethereum (ETH), as a System of Systems (SoS) of public blockchains. We study the concepts of blockchain, BTC, ETH, complex networks, SoS Engineering and intentional risk. We analyse BTC and ETH from an open SoS perspective through the main properties that seminal System of Systems Engineering (SoSE) references propose. This article demonstrates that these public blockchain implementations create networks that grow in complexity and connect with each other. We propose a methodology based on a complexity management lever such as SoSE to better understand public blockchains such as BTC and ETH and manage their evolution. Our ultimate objective is to improve the resilience of public blockchains against intentional risk: a key requirement for their mass adoption. We conclude with specific measures, based on this novel systems engineering approach, to effectively improve the resilience against intentional risk of the open SoS of public blockchains, composed of a non-inflationary money system, “sound money”, such as BTC, and of a world financial computer system, “a financial conduit”, such as ETH. The goal of this paper is to formulate a SoS that transfers digital value and aspires to position itself as a distributed alternative to the fiat currency-based financial system.
Highlights
We conclude that: (a) Our proposed methodology, based on System of Systems Engineering (SoSE), is a valid and replicable tool to understand and to manage complex “supersystems” or “networks of networks”. We apply this methodology to the complexity present in public blockchains: we model BTC and ETH, two public open and permissionless blockchain implementations, as holons that complement each other within a System of Systems (SoS) of public blockchains
ETH, the “distributed world computer”, aims to become the “alternative financial conduit” system to run decentralised finance; (b) The unintended emergent property of the SoS of public blockchains is to stand as an alternative to the traditional centralised financial system based on fiat currencies
This emergent property only appears when we focus on BTC and ETH, and, more generally, on public blockchain implementations, as a unique “supersystem”
Summary
The quest to manage complexity has been present in human beings since early days. The need to register value transfer and ownership. Throughout History, we have created and taken part in complex systems with non-linear relations between their components. We focus on public blockchains, a technology that creates a “supersystem”, called a “network of networks” or a “system of systems”, that registers the transfer of digital value, even with a potential link to physical value. We identify how public blockchains, such as Bitcoin and Ethereum, complement each other and emerge as an alternative to the traditional fiat currencies. We propose a set of multi-disciplinary measures that, based on recent advances in intentional risk management, hint at how to improve resilience in this System of Systems of public blockchains
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