Blockchain and Cryptocurrencies: a Classification and Comparison of Architecture Drivers

Blockchain is a decentralized transaction and data management solution, the technological leap behind the success of Bitcoin and other cryptocurrencies. As the variety of existing blockchains and distributed ledgers continues to increase, adopters should focus on selecting the solution that best fits their needs and the requirements of their decentralized applications, rather than developing yet another blockchain from scratch. In this paper we present a conceptual framework to aid software architects, developers, and decision makers to adopt the right blockchain technology. The framework exposes the interrelation between technological decisions and architectural features, capturing the knowledge from existing academic literature, industrial products, technical forums/blogs, and experts' feedback. We empirically show the applicability of our framework by dissecting the platforms behind Bitcoin and other top 10 cryptocurrencies, aided by a focus group with researchers and industry practitioners. Then, we leverage the framework together with key notions of the Architectural Tradeoff Analysis Method (ATAM) to analyze four real-world blockchain case studies from industry and academia. Results shown that applying our framework leads to a deeper understanding of the architectural tradeoffs, allowing to assess technologies more objectively and select the one that best fit developers needs, ultimately cutting costs, reducing time-to-market and accelerating return on investment.Comment: Accepted for publication at journal Concurrency and Computation: Practice and Experience. Special Issue on distributed large scale applications and environment

The Authority of Distributed Consensus Systems Trust, Governance, and Normative Perspectives on Blockchains and Distributed Ledgers

The subjects of this dissertation are distributed consensus systems (DCS). These systems gained prominence with the implementation of cryptocurrencies, such as Bitcoin. This work aims at understanding the drivers and motives behind the adoption of this class of technologies, and to – consequently – evaluate the social and normative implications of blockchains and distributed ledgers. To do so, a phenomenological account of the field of distributed consensus systems is offered, then the core claims for the adoption of systems are taken into consideration. Accordingly, the relevance of these technologies on trust and governance is examined. It will be argued that the effects on these two elements do not justify the adoption of distributed consensus systems satisfactorily. Against this backdrop, it will be held that blockchains and similar technologies are being adopted because they are regarded as having a valid claim to authority as specified by Max Weber, i.e., herrschaft. Consequently, it will be discussed whether current implementations fall – and to what extent – within the legitimate types of traditional, charismatic, and rational-legal authority. The conclusion is that the conceptualization developed by Weber does not capture the core ideas that appear to establish the belief in the legitimacy of distributed consensus systems. Therefore, this dissertation describes the herrschaft of systems such as blockchains by conceptualizing a computational extension of the pure type of rational-legal authority, qualified as algorithmic authority. The foundational elements of algorithmic authority are then discussed. Particular attention is focused on the idea of normativity cultivated in systems of algorithmic rules as well as the concept of decentralization. Practical suggestions conclude the following dissertation

Cryptocurrency and the Myth of the Trustless Transaction

This article interrogates the claim that trust can be replaced with blockchain technology. Part I begins with an introduction that provides an overview of the trust issues surrounding cryptocurrency. Part II then outlines the role that trust plays in a financial market more generally, focusing specifically on the trust embedded in what cryptocurrency supporters derogate as a ‘fiat’ currency. Part III introduces the blockchain, as well as Bitcoin and cryptocurrency more generally. Part IV then tests the claims that Bitcoin eliminates the need for trust against real-world experiences of Bitcoin holders and markets. This section disaggregates the blockchain technology itself from how actual people typically use Bitcoin or any of the follow-on cryptocurrencies. It documents the many points at which cryptocurrencies shifts the locus of embedded trust, rather than eliminating the need for such trust. Finally, Part V concludes that rather than replacing trust, cryptocurrencies instead require users to repose their trust in less transparent, less reliable and less accountable parties. The ultimate message is that caveat emptor should be a consumer watchword and that users should understand that many legal protections they take for granted may not apply when purchasing cryptocurrency

The Digital Avatar on a Blockchain: E-Identity, Anonymity and Human Dignity

Finanzdienstleister sammeln immer größere Mengen an Daten von ihren Kunden, um konform mit speziellen Rechtsakten (eIDAS Verordnung, Zahlungsdiensterichtlinie, Geldwäscherichtlinie) zu handeln und Risiken zu minimieren. Die durch die fortschreitende Digitalisierung zunehmenden technischen Möglichkeiten der Datensammlung werfen Bedenken auf im Hinblick auf die Grundsätze der Verhältnismäßigkeit, Notwendigkeit und Datenminimierung. Über die Vereinbarkeit mit der Datenschutz-Grundverordnung hinaus ergeben sich jedoch weiterreichende Probleme, da bestimmte Identitätsarchitekturen und deren technische Umsetzungen potentiell die Rechte und Freiheiten einzelner beinträchtigen sowie ethische Fragestellungen aufwerfen. Der vorliegende Beitrag analysiert Aspekte digitaler Identität am Beispiel einer Distributed Ledger- beziehungsweise Blockchain-Architektur für die Registrierung neuer Kunden durch Finanzdienstleister, wo mithilfe von Hashing-Algorithmen individuelle Identifikatoren aus spezifischen Datenpunkten der Kunden gewonnen werden, die schließlich für Zwecke der Nachvollziehbarkeit und Überprüfbarkeit unveränderlich in der Datenstruktur gespeichert werden. Nach einer kurzen Einleitung in das Verständnis von Identität im digitalen Raum und der Anwendbarkeit der Datenschutz-Grundverordnung auf eine distribuierten Datenstruktur wird eine kritische Betrachtung der Entwicklung aus rechtlicher und soziologischer Perspektive vorgenommen, dass zunehmend die Mobiltelefone der Kunden von Finanzdienstleistern als Schnittstellen zu Blockchain-Netzwerken dienen. Die Diskussion reicht über die Frage digitaler Identität im Finanzsektor hinaus und zeigt die Notwendigkeit auf, angemessene und verhältnismäßige rechtliche Bestimmungen zu schaffen, die das Individuum effektiv vor Grundrechtsverletzungen vor dem Hintergrund der fortschreitenden Digitalisierung schützen.In order to comply with specific regulations (eIDAS, Payment Services Directive, Anti-Money Laundering Directive) and reduce risk profiles, financial service providers increasingly collect large amounts of information from their customers. The increasing opportunities and technical means for data collection afforded from digitalisation raise legal concerns related to proportionality, necessity, and data minimization. However, the concerns go beyond just GDPR compliance and legislative balance, as distinct architectures and technological deployments potentially impact rights, freedoms, and ethics. This paper will address the issue by examining aspects of digital identity, especially those that have proposed the use of a permissioned distributed ledger or blockchain as architecture for know your customer and onboarding evidential frameworks, using specific hashing schemes that derive unique identifiers from the combination of specific personal data points. Evidence is appended to a data structure, for the purpose of auditing and/or record keeping, potentially ensuring an immutable record of events is maintained. After elaborating on the notion of identity in the digital sphere and the applicability of the GDPR to such a data structure, the discussion will be developed to critically assess the current trend towards using the financial institutions’ customers’ mobile devices as interfaces to the distributed data structure and the legal and sociological implications of this technological development. The potential impact of the analysis goes beyond digital identity within the finance sector, positioning the discussion towards approaches for e-governance and the regulation of digital identity in a way that human dignity is preserved and the risks of creating a ubiquitous “digital avatar” are adequately addressed by the law

Smart contract and web dapp for tracing sustainability indicators in the textile and clothing value chain

Mestrado em Engenharia Informática na Escola Superior de Tecnologia e Gestão do Instituto Politécnico de Viana do CasteloNa sociedade atual, o têxtil e vestuário é um dos maiores setores de mercado do mundo. O rápido crescimento desta indústria está a ter impactos sem precedentes na sustentabilidade do planeta, respondendo por consequências negativas ambientais, sociais e de saúde. As tendências da fast-fashion, juntamente com a falta de transparência na cadeia de valor têxtil global, somam-se a cenários desfavoráveis para o mundo, à medida que os níveis crescentes de poluição e consumo de recursos dentro da cadeia de valor atingem máximos históricos a cada ano que passa. O ciclo de vida de uma peça de roupa precisa de se adaptar a um modelo económico regenerativo em vez de linear, que acaba no equivalente a um caminhão de lixo de produtos têxteis sendo descartado num aterro sanitário a cada segundo [1]. Não só as indústrias precisam de reformular os seus processos para circularizar as suas cadeias de valor e promover ações sustentáveis, mas também os consumidores precisam de participar do processo de manter os produtos no círculo da cadeia de valor, pois cabe a eles decidir o destino final de um produto vestuário aquando o seu fim da vida útil. Com estas questões em mente, esta dissertação visa desenvolver duas soluções que possam mitigar os problemas a cima mencionados e promover ações sustentáveis rumo a uma economia circular na cadeia de valor do têxtil e vestuário. Uma solução business-to-business baseada em smart contracts do Hyperledger Fabric para gerir a cadeia de valor do têxtil e vestuário com funcionalidade de rastreabilidade foi desenvolvida como prova de conceito para apoiar as reivindicações de sustentabilidade dos participantes na cadeia de valor, da fibra à peça final de vestuário. A actual funcionabilidade de rastreabilidade desenvolvida no smart contract fornece aos operadores da cadeia de valor a capacidade de rastrear um lote até à sua origem, contudo, também limita a escalabilidade devido ao aumento exponencial do tamanho do bloco, especialmente se considerarmos uma cadeia de valor circular. Para os consumidores, foi proposta uma aplicação descentralizada business-to-consumer-to-consumer com elementos de eco-gamificação para promover o envolvimento e motivação do utilizador para a realização de tarefas que contribuam para a adoção de uma economia circular na cadeia de valor do têxtil e vestuário. Após testar a usabilidade da aplicação com o questionário AttrakDiff, concluiu-se que o sistema precisa de focar a sua usabilidade em prol de um produto orientado à tarefa em vez da orientação pessoal atual da aplicação a fim de promover ações que contribuam para a economia circular da cadeia de valor do têxtil e vestuário.In today’s society, Textile and Clothing (T&C) is one of the biggest market sectors world wide.The sheer size and fast growth of this industry is having unprecedented impacts on sustainability, accounting for negative environmental, social and health consequences. The fast-fashion trends along side the lack of transparency in the global T&C value chain add up to unfavorable scenarios for the world as the increas- ing levels of pollution and resource consumption within the value chain reach historic highs with every year that passes. The lifecycle of a clothing item needs to adapt to a regenerative economic model instead of a linear one that ends up in the equivalent of a garbage truck full of textiles being disposed into a landfill every second [1]. Not only do the industries need to revamp their processes to circularize their value chains and promote sustainable actions, but the consumers also need to partake in the process of keeping the products in the value chain loop as it is up to them to make the final decision upon the end-of-life of an item of clothing. With these issues in mind,this dissertation aims to develop two solutions that can mitigate the aforementioned problems and promote sustainable actions towards a circular economy in the T&C value chain. A Proof-of-Concept (PoC) Business-to-Business (B2B) T&C value chainmanagement smart contract solution builton Hyperledger Fabric with traceability features was developed to support the sustainability claims of participants in the value chain, from fiber to garment. The current traceability feature developed into the smart contract provides value chain operators the capabilities to trace a batch back to its origin, however, it also constraints scalability due to the exponential in crease in block size specially if considering a circular value chain. For the consumers, a Business-to-Consumer-to-Consumer (B2C2C) Decentralized Application (DApp) was proposed with eco-gamification elements fo rpromoting the user’s engagement and motivation to complete tasks that contribute for the adoption of a circular economy in the T&C value chain. After testing the consumer DApp’s usability with the AttrakDiff survey, it was concluded that the system needs to focus it susability towards a task-oriented product instead of the current self-oriented results in order to promote actions that contribute to the circular economy of the T&C value chain

Equitable proof-of-work mining rewards

We present Reward-All Nakamoto-Consensus (Reward-All), a Proof-of-Work cryptocurrency that rewards each miner with a number of coins that is directly proportional to its individual mining power, rather than in proportion to its relative share of the entire network’s mining power as done in Bitcoin. Unlike their Bitcoin counterparts, miners in Reward-All do not have to win the leader-election process to earn coins, and only lose earned coins after block reorganizations of a configurable minimum length occur. We present a detailed specification of Reward-All, along with a prototype implementation, and an evaluation of its practicality and efficiency. Additionally, we provide an analysis of the security of Reward-All, where mining is modeled as a Markov Decision Process, and the advantages of optimal mining strategies are quantified. Under reasonable configurations, Reward-All achieves near-perfect incentive compatibility, and near-zero censorship susceptibility, for adversarial mining shares up to 45%, while retaining the same chain quality as Bitcoin’s Nakamoto Consensus (Nakamoto). However, Reward-All pays for these advantages with a regression in subversion gain resilience compared to Nakamoto. Furthermore, under Reward-All’s approach, the growth rate of the total coin supply correlates closely with the growth rate of mining power invested in the network. This enables miners to mint coins at a stable hash-based cost of production, and enables all rewarded coins to correspond to an approximately equal number of hashing attempts on average. Consequently, depending on the network transaction-fees, Reward-All improves miners’ waiting times for rewards, and incentivizes forming mining pools smaller than required in Bitcoin for an equal level of reward stability. Moreover, rewards in Reward-All exhibit significantly lower variance for non-majority miners compared to Nakamoto, enabling unprecedented reward stability.Open Acces

Information Provenance for Mobile Health Data

Mobile health (mHealth) apps and devices are increasingly popular for health research, clinical treatment and personal wellness, as they offer the ability to continuously monitor aspects of individuals\u27 health as they go about their everyday activities. Many believe that combining the data produced by these mHealth apps and devices may give healthcare-related service providers and researchers a more holistic view of an individual\u27s health, increase the quality of service, and reduce operating costs. For such mHealth data to be considered useful though, data consumers need to be assured that the authenticity and the integrity of the data has remained intact---especially for data that may have been created through a series of aggregations and transformations on many input data sets. In other words, information provenance should be one of the main focuses for any system that wishes to facilitate the sharing of sensitive mHealth data. Creating such a trusted and secure data sharing ecosystem for mHealth apps and devices is difficult, however, as they are implemented with different technologies and managed by different organizations. Furthermore, many mHealth devices use ultra-low-power micro-controllers, which lack the kinds of sophisticated Memory Management Units (MMUs) required to sufficiently isolate sensitive application code and data. In this thesis, we present an end-to-end solution for providing information provenance for mHealth data, which begins by securing mHealth data at its source: the mHealth device. To this end, we devise a memory-isolation method that combines compiler-inserted code and Memory Protection Unit (MPU) hardware to protect application code and data on ultra-low-power micro-controllers. Then we address the security of mHealth data outside of the source (e.g., data that has been uploaded to smartphone or remote-server) with our health-data system, Amanuensis, which uses Blockchain and Trusted Execution Environment (TEE) technologies to provide confidential, yet verifiable, data storage and computation for mHealth data. Finally, we look at identity privacy and data freshness issues introduced by the use of blockchain and TEEs. Namely, we present a privacy-preserving solution for blockchain transactions, and a freshness solution for data access-control lists retrieved from the blockchain

Blockchain Initiatives for Tax Administration

A thriving body of literature discusses various legal issues related to blockchain, but often it mixes the discussion about blockchain with cryptocurrency. However, blockchain is not the same as cryptocurrency. Defined as a decentralized, immutable, peer-to-leer ledger technology, blockchain is a newly emerging data management system. The private sector—including the financial industry and supply chains—and the public sector—property records, public health, voting, and compliance, have all begun to utilize blockchain. Since more data is processed remotely, and thus digitally, the evolution of blockchain is gaining stronger momentum. While scholarship on blockchain is growing, none of the scholarship has considered the impact of blockchain on the tax sector. This Article extends the study of blockchain to tax administration, evaluates the feasibility of incorporating blockchain within existing tax administrations, and provides policymakers with criteria to consider and some recommended designs for blockchain. Blockchain can enhance the efficiency and transparency of tax administration through its ability to deliver reliable, real-time information from many sources to a large audience. Further, a well-designed private consortium blockchain, evolved from the classic public blockchain, may effectively protect taxpayers\u27 information. Potential areas that blockchain could enhance are payroll taxes, withholding taxes, value added taxes, transfer pricing, the sharing of information between federal, state, and local governments as well as countries. This Article offers normative considerations for policymakers deliberating blockchain initiatives for tax administration, such as timeline, standardization, its integration with other systems, its limitations, and the accompanying legislation to regulate the government and the taxpayer’s rights and privacy. Those implications may resonate with a broader audience beyond tax policymakers

A User-Centered Perspective for the blockchain Development

Blockchain technology is regarded as one of the most important digital innovations in the last two decades. Its applicability beyond cryptocurrencies has been a growing topic of research interest not only in computer science but also in other areas, such as marketing, finance, law, healthcare, etc. However blockchain is far from reaching the population on a larger scale. The dissertation evaluates the causes that are preventing successful implementation and adoption of blockchain technology at a larger scale, supporting infrastructure for public and private companies. The latest academic research suggests that the blockchain services are still in an early stage, and standards for developing blockchain-based applications have not been defined yet. Moreover the interaction with the blockchain technology is still complex, especially for non expert users, because it requires many technical skills. The dissertation focuses on this knowledge gap as a cause for the blockchain missing reach on society at a larger scale. This work aims to fill the gap by presenting innovative methodologies and user-centered models that could help the adoption of the blockchain technology by a larger number of private/public companies and individuals. Based on these models, specific tools for both expert and non-expert users are developed and discussed in the dissertation. First, tools for expert users, i.e., software developers, are proposed to analyze the smart contracts’ source code, to collect the smart contracts in a reasoned repository, and to identify code clones and boost the use of open source libraries for a better collective practice in developing and maintaining the blockchain. Second, tools for non-expert users, i.e. people with no technical knowledge, are proposed to suggest them the fairest fees to pay to have their transactions executed according to the price and waiting times they are willing to spend, and to identify malicious smart contracts that can deceive them, thus preventing them to trust the blockchain and use it again. Finally, visualization models for users with expertise in different disciplines are proposed to provide them with graphical representations that can foster the understanding of the blockchain underlying mechanisms