The evolution of the exchange process: from the decentralized to the distributed digital exchange

Abstract

There exists an ambiguous attitude in economic theory toward referring to the details of exchange mechanisms as a social system. To date, in classical theories, the main research target has been the exchange mechanism for commodities in general. Instead of studying the exchange of the broader social or community system, recently, much work has focused on auction mechanisms for particular goods in the context of experimental design. However, the advent of the community currency and crypto-currency suggests that we should study the feasibility and sustainability of the broader system. In this article, we will focus on systems of exchange with auctioneers and without auctioneers. We then examine the properties of bilateral exchange between randomly selected traders without auctioneers and explore the resulting properties of iterations of such transactions. Finally, we mention special issues of cryptocurrency in the face of the Byzantine General Problem and discuss a well-coordinated distributed system involving digital tools such as blockchain.