Blockchain-based Technologies Research Articles

Trust, Blockchain-based Technologies, Public Sector, and the Social Good

Many public institutions, government bodies, municipalities are experimenting with blockchain based systems, decentralized ledgers, smart contracts to deliver new innovative services to citizens, or improve the speed, efficiency, accuracy of existing ones. This short policy analysis looks at the potential mismatch between usually high-trust public institutions, and trust-minimizing technological infrastructures. We warn that, in general, we should avoid replacing a high-trust environment with a trust-minimizing technology. Pre-existing trust is very valuable, and no new technology should endanger trust which is extremely hard to build but very easy to destroy. Of course, not all institutions enjoy the trust of the citizenry. In low-trust environments the implementation of trust minimizing technologies need to consider the relative benefits and harms of the different approaches to dealing with low-trust environments. One can decide to implement a technology that is able to operate in such low-trust settings. The alternative to this is to try to implement technologies and policies that foster the emergence of trust. What is the preferable way forward: replacing distrusted public entities with trust-minimizing technologies, or improving their trustworthiness? Should we implement a trust-minimizing architecture, or a trust-maximizing one? Our institutions may be imperfect, and often produce arbitrary outcomes; sometimes they are downright oppressive. But at least there are clear lines of social, public, institutional, political and economic accountability and oversight. Such mechanisms of trust are yet to mature with regard to blockchain technologies. Unless these technologies can be brought into the fold, they remain largely unaccountable, thus fundamentally untrustworthy. And even if they are, we still don’t know which is preferable: a polycentric system of power of checks and balances, which involves democratic oversight, or an ideally decentralized and disintermediated one, where power concentration is prevented? This should be a warning to well-intentioned public servants, institutions and private actors who are looking at implementing blockchain systems in order to better their domain or be seen as innovative, or simply because they fear missing out on a technology development sold to them as a revolution. It may be worth their while not to rush. It is OK to be slow and cautious. Disruptive digital innovation that targets trust should be treated with extreme caution.

Hashing Out Agreements: An Overview of 'Smart' Contracts under Canadian Common Law

Blockchain-based technologies are starting to permeate every aspect of the Canadian legal landscape. Blockchain is often solely associated with cryptocurrencies, such as Bitcoin; however, it has numerous applications beyond virtual currencies. Blockchain technology has the potential to provide numerous opportunities to those providing legal services, notably through smart contracts. However, some legal uncertainty remains with respect to smart contracts. The legality of smart contracts and their place of operation under Canadian law has yet to be researched. Potential risks for clients, as well as for lawyers—especially with respect to their ethical and professionalism duties—also need to be researched and highlighted. This paper begins by providing an overview of smart contracts, including a brief history of the development of smart contracts, followed by a discussion of the underpinnings of blockchain-based applications, and a presentation of some use cases. After forming an understanding of smart contracts, the paper addresses the important technical and legal limitations that smart contracts face. Since blockchain-based smart contracts rely on blockchain technology and digitalization, this paper explains how smart contracts can only be as “smart” as its developer, and the computers running them. This paper then transitions into a discussion of how the advent of cryptocurrencies and smart contracts relaunched decades-old debates about how society should regulate technology. Although we argue that legal frameworks must evolve with society, we will highlight that we do not need to rewrite or create new approaches to each technological innovation. Subsequently, this paper provides an overview of smart contracts under Canadian contract law. As it currently stands, academics have not fully addressed the question of whether smart contracts conform to our traditional contract law framework. This paper will address the legal status and remaining questions regarding the legal status of smart contracts and the enforceability of smart contract performance. While there may be many barriers to the adoption of any new technologies, legal uncertainty—and therefore legal risks for clients and lawyers—should not be one of them. The key findings below present an overview of the academic research on the key legal questions facing smart contracts in Canada. The key findings are followed by an overview of some of the preliminary use cases of smart contracts in the legal field.

Technology assessment of blockchain-based technologies in the food supply chain

Beyond the financial domain, the application of blockchain is highly relevant in supply chain traceability, but the trade-offs between implementation challenges and achievable impact remain unclear. In this study, six cases of blockchain-based technologies in the food supply chain were analyzed applying a technology assessment framework that distinguishes between four different components of a technology: technique, knowledge, organization, and product. The study intends to provide new critical insights on how blockchain-based technologies can be implemented in the food supply chain and to further the discussion of social and environmental implications of blockchain-based technologies. The results highlight how blockchain is not a stand-alone-technology, but rather one element in a system of technologies. While blockchain-based technologies are expected to bring a variety of impacts, only some are directly attributable to the blockchain element: increased transparency, traceability, and trust. Other impacts such as improved data management are a side-effect of digitizing non-digital processes. Further research is needed to confirm whether blockchain-based technologies bring the expected sustainability improvements in food supply chains.

Blockchain energy: Blockchain in future energy systems

The ongoing, in-depth transformation of the electricity sector towards increased use of alternative, renewable energy sources extends beyond a simple decentralisation drive in the electricity market. The transformation process is characterised by the interplay of old and new technologies from the energy sector as well as structural coupling with other sectors, such as the information and communications technology (ICT), enabling the technology transfer as well as market entry by information technology (IT) actors. Blockchain-based technologies have the potential to play a key role in this transition by offering decentralised interfaces and systems as well as an alternative approach to the current organisation form of the energy market. This paper discusses the applicability and prospects for blockchain-based technologies in the energy sector, which are described using the term “blockchain energy”. For the purposes of this study, blockchain energy encompasses all socio-technical and organisational configurations in the energy sector based on the utilisation of the blockchain principle for energy trading, information storage, and/or increased transparency of energy flows and energy services. In the following chapters, the authors present and discuss the current transformation in the electricity market, followed by a review of the different utilisation possibilities for blockchain technologies in the energy sector and a discussion of the barriers and potential for blockchain energy using a transition studies perspective. Finally, the opportunities and risks of blockchain energy are discussed.

An Industry Study of Blockchain Technology’s Impact on Trade Finance

Blockchain’s transformational potential has been heralded across several industries, with some enthusiastic voices comparing its foreseeable impact to that of the essential internet communication protocol TCP-IP. Several enterprises have since adopted distributed ledger technology (DLT)-based approaches as part of their operational procedures, with a view on blockchain as a magic bullet for addressing existing operational inefficiencies, improving transparency, and creating new products. However, in the absence of large-scale feasibility studies and data-based quantifications of the impact of blockchain-based technologies, companies are jumping into early-stage proof-of-concept (POC) projects without clearly-defined key performance indicators or goals for the expected return on investment; efficiency claims and reports of lessons learned are similarly lacking. A quantitative assessment of (1) the nature of a successful application of blockchain technology for supply chain and trade finance, and (2) the current market’s perceived benefits, key challenges, and expected horizons of blockchain is therefore sorely needed. Here we present an empirical study of the industry’s perception of blockchain-based innovation and potential for value creation for supply chain and trade finance. Our survey results show that, while industry experts across all regions view the technology and the value it can provide to streamline and simplify trade finance processes favorably, none of the study’s participants have yet realized any financial or customer-value benefit. Indeed, despite predictions, no tangible savings appear to have been realized to date. Furthermore, while initial technical proof-of-concept (POC) implementations of blockchain have been executed without major difficulties, we find that challenges associated with broader-scale adoption remain unaddressed. Notably, coordinating the simultaneous adoption of a shared solution by different stakeholders remains a formidable challenge, thus hampering the potential large-scale adoption of blockchain technology.

SLA-Based Sharing Economy Service with Smart Contract for Resource Integrity in the Internet of Things

Recently, technology startups have leveraged the potential of blockchain-based technologies to govern institutions or interpersonal trust by enforcing signed treaties among different individuals in a decentralized environment. However, it is going to be hard enough convincing that the blockchain technology could completely replace the trust among trading partners in the sharing economy as sharing services always operate in a highly dynamic environment. With the rapid expanding of the rental market, the sharing economy faces more and more severe challenges in the form of regulatory uncertainty and concerns about abuses. This paper proposes an enhanced decentralized sharing economy service using the service level agreement (SLA), which documents the services the provider will furnish and defines the service standards the provider is obligated to meet. The SLA specifications are defined as the smart contract, which facilitates multi-user collaboration and automates the process with no involvement of the third party. To demonstrate the usability of the proposed solution in the sharing economy, a notebook sharing case study is implemented using the Hyperledger Fabric. The functionalities of the smart contract are tested using the Hyperledger Composer. Moreover, the efficiency of the designed approach is demonstrated through a series of experimental tests using different performance metrics.

Blockchain, adoption, and financial inclusion in India: Research opportunities

The economic development of rural India requires connecting remote villages to local and global supply chains. Yet, high rates of financial exclusion inhibit rural Indians from participating in these supply networks. We review the literature on financial inclusion, adoption, and blockchain in India, and posit that to resolve financial exclusion, the four challenges of geographical access, high cost, inappropriate banking products, and financial illiteracy need to be overcome. Next, we argue that blockchain technologies hold the potential to overcome most of these challenges. However, for blockchain technologies to become the cornerstone of financial inclusion initiatives, an understanding of technology adoption in India is needed. To guide the development of such understanding, we develop a research agenda on the antecedents of adoption, adoption patterns, and outcomes of adoption. Answering these research questions will lead to a nuanced understanding of adoption of blockchain-based technologies in rural India. The practical contribution of this paper is the discussion of how blockchain can alleviate the issue of financial exclusion in rural India, thereby providing a basis for a solution that could connect rural Indians to global supply chain networks. The theoretical contribution lies in the identification of knowledge gaps that should be answered to achieve financial inclusion of rural Indians.

The Limits to Blockchain? Scaling vs. Decentralization

This discussion paper examines a possible limitation to the advancement of blockchain: the intrinsic tradeoff between scaling to a larger size, and the need to maintain a decentralized and distributed architecture. The scaling vs. decentralization trade-off, the paper argues, may impose a long-term limitation on the growth of blockchain-based technologies including cryptocurrencies.

Blockchain and Environmental Sustainability: Case of IBM's Blockchain Water Management

This discussion paper considers the role that blockchain-based technologies can play in advancing initiatives pertaining to environmental sustainability, using the case study of IBM’s water management blockchain development in California. The paper finds that there is substantial room for incorporating blockchain technology into environmental protection and sustainability projects, including in the mitigation of information asymmetry through transparency so as to foster stronger market-mechanisms in the allocation of resources.

Blockchain-Based System for Multiparty Electronic Registered Delivery Services

European Regulation (EU) 910/2014 lays down the rules for electronic identification and trust services for electronic transactions. Qualified Electronic Registered Delivery is one of the trust services included in the regulation, and it requires nonrepudiation of origin and reception together with the integrity of the data. This kind of services usually relies heavily on the use of trusted third parties. These entities are an obstacle to extend the use of protocols. In this paper, we use the blockchain-based technologies to provide, for the first time, two multiparty registered eDelivery schemes that reduce the involvement of trusted third parties compared with traditional approaches while satisfying the requirements of the norms created by the European Union for registered eDeliveries. Since confidentiality is not considered a compulsory property in the directive, we propose two protocols. The first one is well suited for those deliveries that do not require the confidentiality of the message or delivered data or even for those in which it is required that the message can be public and accessible to everybody. The second solution for multiparty registered eDelivery allows the message to be hidden to others than the receiver. We present the smart contracts for both proposals and also a complete analysis of their properties and performance.

Disrupting Education Through Blockchain-Based Education Technology?

This study is the first to systematically analyze the use of blockchain technology in education. In particular, we analyze the status quo of blockchain-based education technologies (N = 62; i.e., a full analysis). We performed a qualitative content analysis of providers’ websites to analyze the characteristics of their technologies. The analysis reveals that existing blockchain-based education technologies are diverse and offer important advantages for education (e.g., trust and equal opportunities). Employers seem to profit from these technologies (e.g., trust in applicants), but only some technologies contribute to the individualization of education. Current blockchain-based education technologies were primarily made for the general public or for job seekers. We conclude that blockchain technology might disrupt education but that this process of change is only in its infancy. Given the high relevance of this topic, we conclude by developing an agenda for future research.

Hedge Funds and Cryptocurrencies: A Top-Down Analysis

Cryptocurrencies and blockchain-based technologies represent one of the most debated topics in the financial services landscape. In this respect, during the past months several institutional investors, and namely hedge funds and their managers, have demonstrated a growing interest in the aforesaid field. The present article aims to elucidate the regulatory treatment of hedge funds investing into cryptocurrencies, focusing in particular on the regulatory framework currently in force in Malta, the first EU country which regulated collective investment schemes investing into cryptocurrencies and currently focused to create a crypto-friendly environment for asset managers and service providers. Starting from a breakdown on the notion of cryptocurrency according to the EU and Maltese legal framework, the paper will highlight the main features of the set-up and licensing process applicable to hedge funds investing into cryptocurrencies and will elucidate the industry-specific risks related to cryptocurrencies and the regulatory and operating pitfalls which hedge fund managers may incur into when setting up a fund investing into cryptocurrencies.

Blockchain Enhancing Political Accountability? Sierra Leone 2018 Case

This discussion paper considers the possibilities for bolstering political accountability using blockchain systems, and uses the 2018 Sierra Leonean elections to illustrate the case for enhanced transparency and accountability through the installment of blockchain-based technologies. The findings of the paper suggest that similar blockchain architectures can be deployed in other countries for the purposes of bolstering accountability and transparency in the political realm.

Rep on the Roll: A Peer to Peer Reputation System Based on a Rolling Blockchain

This paper presents the first generalized reputation system that can be applied to multiple networks that is based on the blockchain. We first discuss current reputation systems, conducting a critical analysis of their current security vulnerabilities, before looking at how new blockchain-based technologies are used. We propose an innovative new reputation system that is based on blockchain technologies and which aims to solve many unanswered questions in the current generation of reputation systems, as well as blockchain systems in general. We then consider the limitations of such a system, before using simulations and analyses to demonstrate methods of overcoming these limitations, and in doing so, provide a possible solution to a fundamental issue in blockchain-based networks; scalability. We conclude by suggesting areas for future studies, and summarizing our findings.