Bitcoin Governance as a Decentralized Financial Market Infrastructure

Bitcoin is the oldest and most widely established cryptocurrency network with the highest market capitalization among all cryptocurrencies. Although bitcoin (with lowercase b) is increasingly viewed as a digital asset belonging to a new asset class, the Bitcoin network (with uppercase B) is a decentralized financial market infrastructure (dFMI) that clears and settles transactions in its native asset without relying on the conventional financial market infrastructures (FMIs). To be a reliable asset class as well as a dFMI, however, Bitcoin needs to have robust governance arrangements; whether such arrangements are built into the protocol (i.e., on-chain governance mechanisms) or relegated to the participants in the Bitcoin network (i.e., off-chain governance mechanisms), or are composed of a combination of both mechanisms (i.e., a hybrid form of governance). This paper studies Bitcoin governance with a focus on its alleged shortcomings. In so doing, after defining Bitcoin governance and its objectives, the paper puts forward an idiosyncratic governance model whose main objective is to preserve and maximize the main value proposition of Bitcoin, i.e., its censorship-resistant property, which allows participants to transact in an environment with minimum social trust. Therefore, Bitcoin governance, including the processes through which Bitcoin governance crises have been resolved and the standards against which the Bitcoin Improvement Proposals (BIPs) are examined, should be analyzed in light of the prevailing narrative of Bitcoin as a censorship-resistant store of value and payment infrastructure. Within such a special governance model, this paper seeks to identify the potential shortcomings in Bitcoin governance by reference to the major governance crises that posed serious threats to Bitcoin in the last decade. It concludes that the existing governance arrangements in the Bitcoin network have been largely successful in dealing with Bitcoin’s major crises that would have otherwise become existential threats to the Bitcoin network

Understanding the Role of Actor Heterogeneity in Blockchain Splits: An Actor-Network Perspective of Bitcoin Forks

This paper investigates the focal actors and their heterogeneity in blockchain splits. Disagreements in blockchain communities often lead to splits in the blockchain and the community. For example, disagreements within the Bitcoin community on increasing the block size led to the blockchain split and creation of Bitcoin Cash. We build on actor-network theory to investigate blockchain split as a translation process, and employ case study methodology to examine Bitcoin splits. We identify several human actors, such as miners, developers, merchants, and investors, as well as non-human actors including ideologies, exchanges and computer programs involved in Bitcoin splits. Our results show that actor heterogeneity, that is, the complex constellation of diverse actors, plays a key role in blockchain splits. We further describe how the human and non-human actors’ fluid moves into micro and macro positions in the network affect the development of the split. We also discuss the role of these actors and their engagement in forming micro and macro agencies in blockchain splits. Our study adds to the understanding of actor behavior and network dynamics in decentralized information systems such as blockchain and open source software

An Explorative Dive into Decision Rights and Governance of Blockchain: A Literature Review and Empirical Study

Background: Blockchain technology and accompanying programmed protocols (smart contracts) offer disruptive opportunities for businesses, public institutions, society, and its citizens. However, blockchain is a relatively young research area: the number of publications available regarding blockchain did not begin to rise significantly until 2012, and certain fields of the blockchain domain remain to be explored. A similar situation exists with research into the governance of blockchain solutions focusing on decision rights: the limited number of theoretical and empirical contributions hinders the proper adoption of governance mechanisms in practice. Method: A mixed-method approach was conducted in which 1) a structured literature review, 2) semi-structured interviews, and 3) a focus group discussion were utilized to determine the current situation regarding decision rights in the context of blockchain governance. Results: The structured literature review resulted in a total of 23 relevant contributions. Those contributions were consolidated to serve as input for a total of twelve semi-structured interviews, and for a focus group session with five participants, who were not part of the interviewee pool. Using that approach, an overview of the concepts, relationships and mechanisms pertinent to decision rights was composed. Conclusions: Considered together, the results show that decision rights are often overlooked at the start of a blockchain project, where technical considerations are dominant in the discussion with stakeholders. However, research also points out that the longer it takes to address decision rights in a blockchain consortium, the more complex and costly it becomes to introduce governance mechanisms at a later stage. Another important conclusion is that consensus is currently lacking as to what constitutes blockchain governance and what part decision rights play in governance processes, in both theoretical and practical terms

Using Blockchain Technology in Smart Life Applications

مقدمة: Blockchain هي قاعدة بيانات يتم تخزينها بترتيب زمني بطريقة آمنة ومستقرة. كانت Bitcoin هي التطبيق الأولي لتقنية Blockchain ، ولكن نظرًا لفوائدها من حيث الأمان والخصوصية والتحكم الذاتي ، فقد تم اعتمادها منذ ذلك الحين من قبل مجموعة متنوعة من التطبيقات. يتم إنشاء تقنية Blockchain عن طريق ربط الكتل معًا بشكل مشفر. نظرًا لأن كل كتلة تحتوي على كلٍ من التجزئة الخاصة بها وتجزئة الكتلة السابقة لها ، فلا يمكن لأي شخص خارجي كسر السلسلة. تُستخدم تقنية Blockchain ضمن مجموعة متنوعة من التطبيقات ، بما في ذلك الصناعية والتجارية والأمنية وسلسلة التوريد وإنترنت الأشياء وغيرها. هذا لأنه يتميز بمزايا التحكم في البيانات وتنظيمها وتخزينها. الغرض من هذه المقالة هو سرد بعض التطبيقات ومجالات التطوير الخاصة بـ Blockchain.   طرق العمل: في تقنية Blockchain ، يعد الأمان والاستقرار (الثبات) واللامركزية من بين الأشياء المهمة التي تجعل هذه التقنية مفيدة في مختلف مجالات الحياة التي تخدم المستخدم. تم استخدام هذه المزايا لحل العديد من المشكلات التي تواجه الشبكة ، بما في ذلك المشكلات المتعلقة بالإنتاجية ووقت المعالجة وقابلية التوسع. تم استخدام طرق مختلفة في الحل ، بما في ذلك العمل على تغيير هيكل الشبكة ، واختيار عقدة أساسية (المدير) ، والتعدين الموازي ، والتنافس مع عمال المناجم الآخرين. الاستنتاجات: ازداد الميل إلى استخدام تقنية Blockchain في العديد من المجالات ، بما في ذلك المالية والزراعية والتجارية والصحية وإنترنت الأشياء وغيرها ، نظرًا لمزاياها ، بما في ذلك اللامركزية والتوزيع والموثوقية والاستقرار. هناك اتجاهات أخرى عملت على تطوير أداء وكفاءة وأمان نظام Blockchain نفسه في إنترنت الأشياء والرعاية الصحية وسلسلة التوريد والقطاع المصرفي والتسويق الرقمي بالإضافة إلى الدراسات التي تشمل تحسين الكفاءة والأمان وتطوير النظام.Background: Materials and Methods:      In Blockchain technology, security, stability (immutability), and decentralization are among the important things that make this technology useful in various areas of life that serve the user. These advantages were used to solve many problems facing the network, including those of productivity, processing time, and scalability. Various methods were used in the solution, including working on a change in the network structure, choosing a basic node (the manager), parallel mining, and competing with other miners. Results:     Through recent studies, it has been shown that the Blockchain technology has been used in various fields, as it is characterized by many advantages, the most important of which are security, decentralization, and stability. Because of these advantages, it outperforms other technologies. Conclusion:     Due to its advantages, the tendency to use blockchain technology has increased in many fields, including financial, agricultural, commercial, health, the Internet of Things, and others. It includes decentralization, distribution, reliability, and stability. There are other trends that have worked to improve the performance, efficiency, and security of the blockchain system itself, In the Internet of Things, healthcare, supply chain management, the banking sector, and digital marketing In addition to studies that include improving the efficiency, security, and development of the system

Blockchains as Infrastructure and Semicommons

Blockchains are not self-executing machines. They are resource systems designed by people, maintained by people, and governed by people. Their technical protocols help to solve some difficult problems in shared resource management, but behind those protocols there are always communities of people struggling with familiar challenges in governing their provision and use of common infrastructure. In this Article, we describe blockchains as shared, distributed transactional ledgers using two frameworks from commons theory. Brett Frischmann’s theory of infrastructure provides an external view, showing how blockchains provide useful, generic infrastructure for recording transactions and why that infrastructure is most naturally made available on common, nondiscriminatory terms. Henry Smith’s theory of semicommons provides an internal view, showing how blockchains intricately combine private resources (such as physical hardware and on-chain assets) with common resources (such as the shared transactional ledger and the blockchain protocol itself). We then detail how blockchains struggle with many of the governance challenges that these frameworks predict, requiring blockchain communities to engage in extensive off-chain governance work to coordinate their uses and achieve consensus. Blockchains function as infrastructure and semicommons not in spite of the human element, but because of it

Blockchain metrics and indicators in cryptocurrency trading

The objective of this paper is the construction of new indicators that can be useful to operate in the cryptocurrency market. These indicators are based on public data obtained from the blockchain network, specifically from the nodes that make up Bitcoin mining. Therefore, our analysis is unique to that network. The results obtained with numerical simulations of algorithmic trading and prediction via statistical models and Machine Learning demonstrate the importance of variables such as the hash rate, the difficulty of mining or the cost per transaction when it comes to trade Bitcoin assets or predict the direction of price. Variables obtained from the blockchain network will be called here blockchain metrics. The corresponding indicators (inspired by the ‘‘Hash Ribbon’’) perform well in locating buy signals. From our results, we conclude that such blockchain indicators allow obtaining information with a statistical advantage in the highly volatile cryptocurrency market