The fragility of decentralised trustless socio-technical systems

The blockchain technology promises to transform finance, money and even governments. However, analyses of blockchain applicability and robustness typically focus on isolated systems whose actors contribute mainly by running the consensus algorithm. Here, we highlight the importance of considering trustless platforms within the broader ecosystem that includes social and communication networks. As an example, we analyse the flash-crash observed on 21st June 2017 in the Ethereum platform and show that a major phenomenon of social coordination led to a catastrophic cascade of events across several interconnected systems. We propose the concept of “emergent centralisation” to describe situations where a single system becomes critically important for the functioning of the whole ecosystem, and argue that such situations are likely to become more and more frequent in interconnected socio-technical systems. We anticipate that the systemic approach we propose will have implications for future assessments of trustless systems and call for the attention of policy-makers on the fragility of our interconnected and rapidly changing world

Wikipedia and Digital Currencies: Interplay Between Collective Attention and Market Performance

The production and consumption of information about Bitcoin and other digital-, or 'crypto'-, currencies have grown together with their market capitalisation. However, a systematic investigation of the relationship between online attention and market dynamics, across multiple digital currencies, is still lacking. Here, we quantify the interplay between the attention towards digital currencies in Wikipedia and their market performance. We consider the entire edit history of currency-related pages, and their view history from July 2015. First, we quantify the evolution of the cryptocurrency presence in Wikipedia by analysing the editorial activity and the network of co-edited pages. We find that a small community of tightly connected editors is responsible for most of the production of information about cryptocurrencies in Wikipedia. Then, we show that a simple trading strategy informed by Wikipedia views performs better, in terms of returns on investment, than classic baseline strategies for most of the covered period. Our results contribute to the recent literature on the interplay between online information and investment markets, and we anticipate it will be of interest for researchers as well as investors

Formation of Languages; Equality, Hierarchy and Teachers

A quantitative method is suggested, where meanings of words, and grammatic rules about these, of a vocabulary are represented by real numbers. People meet randomly, and average their vocabularies if they are equal; otherwise they either copy from higher hierarchy or stay idle. Presence of teachers broadcasting the same (but arbitrarily chosen) vocabulary leads the language formations to converge more quickly.Comment: 10 pages, 3 (totally 8) figure

Machine Learning meets Number Theory: The Data Science of Birch-Swinnerton-Dyer

Empirical analysis is often the first step towards the birth of a conjecture. This is the case of the Birch-Swinnerton-Dyer (BSD) Conjecture describing the rational points on an elliptic curve, one of the most celebrated unsolved problems in mathematics. Here we extend the original empirical approach, to the analysis of the Cremona database of quantities relevant to BSD, inspecting more than 2.5 million elliptic curves by means of the latest techniques in data science, machine-learning and topological data analysis. Key quantities such as rank, Weierstrass coefficients, period, conductor, Tamagawa number, regulator and order of the Tate-Shafarevich group give rise to a high-dimensional point-cloud whose statistical properties we investigate. We reveal patterns and distributions in the rank versus Weierstrass coefficients, as well as the Beta distribution of the BSD ratio of the quantities. Via gradient boosted trees, machine learning is applied in finding inter-correlation amongst the various quantities. We anticipate that our approach will spark further research on the statistical properties of large datasets in Number Theory and more in general in pure Mathematics

Consequence of reputation in an open-ended Naming Game

We study a modified version of the Naming Game, a recently introduced model which describes how shared vocabulary can emerge spontaneously in a population without any central control. In particular, we introduce a new mechanism that allows a continuous interchange with the external inventory of words. A novel playing strategy, influenced by the hierarchical structure that individuals' reputation defines in the community, is implemented. We analyze how these features influence the convergence times, the cognitive efforts of the agents and the scaling behavior in memory and time.Comment: 6 pages, 6 figure

Collective Dynamics of Dark Web Marketplaces

Dark markets are commercial websites that use Bitcoin to sell or broker transactions involving drugs, weapons, and other illicit goods. Being illegal, they do not offer any user protection, and several police raids and scams have caused large losses to both customers and vendors over the past years. However, this uncertainty has not prevented a steady growth of the dark market phenomenon and a proliferation of new markets. The origin of this resilience have remained unclear so far, also due to the difficulty of identifying relevant Bitcoin transaction data. Here, we investigate how the dark market ecosystem re-organises following the disappearance of a market, due to factors including raids and scams. To do so, we analyse 24 episodes of unexpected market closure through a novel datasets of 133 million Bitcoin transactions involving 31 dark markets and their users, totalling 4 billion USD. We show that coordinated user migration from the closed market to coexisting markets guarantees overall systemic resilience beyond the intrinsic fragility of individual markets. The migration is swift, efficient and common to all market closures. We find that migrants are on average more active users in comparison to non-migrants and move preferentially towards the coexisting market with the highest trading volume. Our findings shed light on the resilience of the dark market ecosystem and we anticipate that they may inform future research on the self-organisation of emerging online markets

#Bigbirds never die: Understanding social dynamics of emergent hashtag

We examine the growth, survival, and context of 256 novel hashtags during the 2012 U.S. presidential debates. Our analysis reveals the trajectories of hashtag use fall into two distinct classes: “winners” that emerge more quickly and are sustained for longer periods of time than other “also-rans” hashtags. We propose a “conversational vibrancy” framework to capture dynamics of hashtags based on their topicality, interactivity, diversity, and prominence. Statistical analyses of the growth and persistence of hashtags reveal novel relationships between features of this framework and the relative success of hashtags. Specifically, retweets always contribute to faster hashtag adoption, replies extend the life of “winners” while having no effect on “also-rans.” This is the first study on the lifecycle of hashtag adoption and use in response to purely exogenous shocks. We draw on theories of uses and gratification, organizational ecology, and language evolution to discuss these findings and their implications for understanding social influence and collective action in social media more generally

Non-equilibrium phase transition in negotiation dynamics

We introduce a model of negotiation dynamics whose aim is that of mimicking the mechanisms leading to opinion and convention formation in a population of individuals. The negotiation process, as opposed to ``herding-like'' or ``bounded confidence'' driven processes, is based on a microscopic dynamics where memory and feedback play a central role. Our model displays a non-equilibrium phase transition from an absorbing state in which all agents reach a consensus to an active stationary state characterized either by polarization or fragmentation in clusters of agents with different opinions. We show the exystence of at least two different universality classes, one for the case with two possible opinions and one for the case with an unlimited number of opinions. The phase transition is studied analytically and numerically for various topologies of the agents' interaction network. In both cases the universality classes do not seem to depend on the specific interaction topology, the only relevant feature being the total number of different opinions ever present in the system.Comment: 4 pages, 4 figure