“The Blockchain Folk Theorem”
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Virtual Currencies and Terrorist Financing : Assessing the Risks And
DIRECTORATE GENERAL FOR INTERNAL POLICIES POLICY DEPARTMENT FOR CITIZENS' RIGHTS AND CONSTITUTIONAL AFFAIRS COUNTER-TERRORISM Virtual currencies and terrorist financing: assessing the risks and evaluating responses STUDY Abstract This study, commissioned by the European Parliament’s Policy Department for Citizens’ Rights and Constitutional Affairs at the request of the TERR Committee, explores the terrorist financing (TF) risks of virtual currencies (VCs), including cryptocurrencies such as Bitcoin. It describes the features of VCs that present TF risks, and reviews the open source literature on terrorist use of virtual currencies to understand the current state and likely future manifestation of the risk. It then reviews the regulatory and law enforcement response in the EU and beyond, assessing the effectiveness of measures taken to date. Finally, it provides recommendations for EU policymakers and other relevant stakeholders for ensuring the TF risks of VCs are adequately mitigated. PE 604.970 EN ABOUT THE PUBLICATION This research paper was requested by the European Parliament's Special Committee on Terrorism and was commissioned, overseen and published by the Policy Department for Citizens’ Rights and Constitutional Affairs. Policy Departments provide independent expertise, both in-house and externally, to support European Parliament committees and other parliamentary bodies in shaping legislation and exercising democratic scrutiny over EU external and internal policies. To contact the Policy Department for Citizens’ Rights and Constitutional Affairs or to subscribe to its newsletter please write to: [email protected] RESPONSIBLE RESEARCH ADMINISTRATOR Kristiina MILT Policy Department for Citizens' Rights and Constitutional Affairs European Parliament B-1047 Brussels E-mail: [email protected] AUTHORS Tom KEATINGE, Director of the Centre for Financial Crime and Security Studies, Royal United Services Institute (coordinator) David CARLISLE, Centre for Financial Crime and Security Studies, Royal United Services Institute, etc. -
Banking on Bitcoin: BTC As Collateral
Banking on Bitcoin: BTC as Collateral Arcane Research Bitstamp Arcane Research is a part of Arcane Crypto, Bitstamp is the world’s longest-running bringing data-driven analysis and research cryptocurrency exchange, supporting to the cryptocurrency space. After launch in investors, traders and leading financial August 2019, Arcane Research has become institutions since 2011. With a proven track a trusted brand, helping clients strengthen record, cutting-edge market infrastructure their credibility and visibility through and dedication to personal service with a research reports and analysis. In addition, human touch, Bitstamp’s secure and reliable we regularly publish reports, weekly market trading venue is trusted by over four million updates and articles to educate and share customers worldwide. Whether it’s through insights. their intuitive web platform and mobile app or industry-leading APIs, Bitstamp is where crypto enters the world of finance. For more information, visit www.bitstamp.net 2 Banking on Bitcoin: BTC as Collateral Banking on bitcoin The case for bitcoin as collateral The value of the global market for collateral is estimated to be close to $20 trillion in assets. Government bonds and cash-based securities alike are currently the most important parts of a well- functioning collateral market. However, in that, there is a growing weakness as rehypothecation creates a systemic risk in the financial system as a whole. The increasing reuse of collateral makes these assets far from risk-free and shows the potential instability of the financial markets and that it is more fragile than many would like to admit. Bitcoin could become an important part of the solution and challenge the dominating collateral assets in the future. -
Bitcoin: Technology, Economics and Business Ethics
Bitcoin: Technology, Economics and Business Ethics By Azizah Aljohani A thesis submitted to the Faculty of Graduate and Postdoctoral Studies in partial fulfilment of the degree requirements of MASTER OF SCIENCE IN SYSTEM SCIENCE FACULTY OF ENGINEERING University of Ottawa Ottawa, Ontario, Canada August 2017 © Azizah Aljohani, Ottawa, Canada, 2017 KEYWORDS: Virtual currencies, cryptocurrencies, blockchain, Bitcoin, GARCH model ABSTRACT The rapid advancement in encryption and network computing gave birth to new tools and products that have influenced the local and global economy alike. One recent and notable example is the emergence of virtual currencies, also known as cryptocurrencies or digital currencies. Virtual currencies, such as Bitcoin, introduced a fundamental transformation that affected the way goods, services, and assets are exchanged. As a result of its distributed ledgers based on blockchain, cryptocurrencies not only offer some unique advantages to the economy, investors, and consumers, but also pose considerable risks to users and challenges for regulators when fitting the new technology into the old legal framework. This paper attempts to model the volatility of bitcoin using 5 variants of the GARCH model namely: GARCH(1,1), EGARCH(1,1) IGARCH(1,1) TGARCH(1,1) and GJR-GARCH(1,1). Once the best model is selected, an OLS regression was ran on the volatility series to measure the day of the week the effect. The results indicate that the TGARCH (1,1) model best fits the volatility price for the data. Moreover, Sunday appears as the most significant day in the week. A nontechnical discussion of several aspects and features of virtual currencies and a glimpse at what the future may hold for these decentralized currencies is also presented. -
Is Bitcoin Rat Poison? Cryptocurrency, Crime, and Counterfeiting (Ccc)
IS BITCOIN RAT POISON? CRYPTOCURRENCY, CRIME, AND COUNTERFEITING (CCC) Eric Engle1 1 JD St. Louis, DEA Paris II, DEA Paris X, LL.M.Eur., Dr.Jur. Bremen, LL.M. Humboldt. Eric.Engle @ yahoo.com, http://mindworks.altervista.org. Dr. Engle beleives James Orlin Grabbe was the author of bitcoin, and is certain that Grabbe issued the first digital currency and is the intellectual wellspring of cryptocurrency. Kalliste! Copyright © 2016 Journal of High Technology Law and Eric Engle. All Rights Re- served. ISSN 1536-7983. 2016] IS BITCOIN RAT POISON? 341 Introduction Distributed cryptographic currency, most famously exempli- fied by bitcoin,2 is anonymous3 on-line currency backed by no state.4 The currency is generated by computation (“mining”), purchase, or trade.5 It is stored and tracked using peer-to-peer technology,6 which 2 See Jonathan B. Turpin, Note, Bitcoin: The Economic Case for A Global, Virtual Currency Operating in an Unexplored Legal Framework, 21 IND. J. GLOBAL LEGAL STUD. 335, 337-38 (2014) (describing how Bitcoin is a virtual currency). Bitcoin is supported by a distributed network of users and relies on advanced cryptography techniques to ensure its stability and reliability. A Bitcoin is simply a chain of digital signatures (i.e., a string of numbers) saved in a “wallet” file. This chain of signa- tures contains the necessary history of the specific Bitcoin so that the system may verify its legitimacy and transfer its ownership from one user to another upon request. A user's wallet consists of the Bitcoins it contains, a public key, and a private key. -
Prospectus, Which Is in the Swedish-Language, and Which Was Approved by the Swedish Financial Supervisory Authority on 17 May 2019
NB: This English-language document is an unofficial translation of XBT Provider AB's base prospectus, which is in the Swedish-language, and which was approved by the Swedish Financial Supervisory Authority on 17 May 2019. In the case of any discrepancies between the base prospectus and this English translation, the Swedish-language base prospectus shall prevail. BASE PROSPECTUS Dated 17 May 2019 for the issuance of BITCOIN TRACKER CERTIFICATES, BITCOIN CASH TRACKER CERTIFICATES, ETHEREUM TRACKER CERTIFICATES, ETHEREUM CLASSIC TRACKER CERTIFICATES, LITECOIN TRACKER CERTIFICATES, XRP TRACKER CERTIFICATES, NEO TRACKER CERTIFICATES & BASKET CERTIFICATES under the Issuance programme of XBT Provider AB (publ) (a limited liability company incorporated under the laws of Sweden) The Certificates are guaranteed by CoinShares (Jersey) Limited ______________________________________ IMPORTANT INFORMATION This base prospectus (the "Base Prospectus") contains information relating to Certificates (as defined below) to be issued under the programme (the "Programme"). Under the Base Prospectus, XBT Provider AB (publ) (the "Issuer" or "XBT Provider") may, from time to time, issue Certificates and apply for such Certificates to be admitted to trading on one or more regulated markets or multilateral trading facilities ("MTF’s") in Finland, Germany, the Netherlands, Norway, Sweden, the United Kingdom or, subject to completion of relevant notification measures, any other Member State within the European Economic Area ("EEA"). The correct performance of the Issuer's payment obligations regarding the Certificates under the Programme are guaranteed by CoinShares (Jersey) Limited (the "Guarantor"). The Certificates are not principal-protected and do not bear interest. Consequently, the value of, and any amounts payable under, the Certificates will be strongly influenced by the performance of the Tracked Digital Currencies (as defined herein) and, unless the certificates are denominated in USD, the USD-SEK exchange rate or, as the case may be, the USD-EUR exchange rate. -
Cryptocurrency: the Economics of Money and Selected Policy Issues
Cryptocurrency: The Economics of Money and Selected Policy Issues Updated April 9, 2020 Congressional Research Service https://crsreports.congress.gov R45427 SUMMARY R45427 Cryptocurrency: The Economics of Money and April 9, 2020 Selected Policy Issues David W. Perkins Cryptocurrencies are digital money in electronic payment systems that generally do not require Specialist in government backing or the involvement of an intermediary, such as a bank. Instead, users of the Macroeconomic Policy system validate payments using certain protocols. Since the 2008 invention of the first cryptocurrency, Bitcoin, cryptocurrencies have proliferated. In recent years, they experienced a rapid increase and subsequent decrease in value. One estimate found that, as of March 2020, there were more than 5,100 different cryptocurrencies worth about $231 billion. Given this rapid growth and volatility, cryptocurrencies have drawn the attention of the public and policymakers. A particularly notable feature of cryptocurrencies is their potential to act as an alternative form of money. Historically, money has either had intrinsic value or derived value from government decree. Using money electronically generally has involved using the private ledgers and systems of at least one trusted intermediary. Cryptocurrencies, by contrast, generally employ user agreement, a network of users, and cryptographic protocols to achieve valid transfers of value. Cryptocurrency users typically use a pseudonymous address to identify each other and a passcode or private key to make changes to a public ledger in order to transfer value between accounts. Other computers in the network validate these transfers. Through this use of blockchain technology, cryptocurrency systems protect their public ledgers of accounts against manipulation, so that users can only send cryptocurrency to which they have access, thus allowing users to make valid transfers without a centralized, trusted intermediary. -
Cryptocurrencies As an Alternative to Fiat Monetary Systems David A
View metadata, citation and similar papers at core.ac.uk brought to you by CORE provided by Digital Commons at Buffalo State State University of New York College at Buffalo - Buffalo State College Digital Commons at Buffalo State Applied Economics Theses Economics and Finance 5-2018 Cryptocurrencies as an Alternative to Fiat Monetary Systems David A. Georgeson State University of New York College at Buffalo - Buffalo State College, [email protected] Advisor Tae-Hee Jo, Ph.D., Associate Professor of Economics & Finance First Reader Tae-Hee Jo, Ph.D., Associate Professor of Economics & Finance Second Reader Victor Kasper Jr., Ph.D., Associate Professor of Economics & Finance Third Reader Ted P. Schmidt, Ph.D., Professor of Economics & Finance Department Chair Frederick G. Floss, Ph.D., Chair and Professor of Economics & Finance To learn more about the Economics and Finance Department and its educational programs, research, and resources, go to http://economics.buffalostate.edu. Recommended Citation Georgeson, David A., "Cryptocurrencies as an Alternative to Fiat Monetary Systems" (2018). Applied Economics Theses. 35. http://digitalcommons.buffalostate.edu/economics_theses/35 Follow this and additional works at: http://digitalcommons.buffalostate.edu/economics_theses Part of the Economic Theory Commons, Finance Commons, and the Other Economics Commons Cryptocurrencies as an Alternative to Fiat Monetary Systems By David A. Georgeson An Abstract of a Thesis In Applied Economics Submitted in Partial Fulfillment Of the Requirements For the Degree of Master of Arts May 2018 State University of New York Buffalo State Department of Economics and Finance ABSTRACT OF THESIS Cryptocurrencies as an Alternative to Fiat Monetary Systems The recent popularity of cryptocurrencies is largely associated with a particular application referred to as Bitcoin. -
Introducing Uni, Yfi and Snx at Bitstamp with Zero Fees Until the End of July!
2021. 4. 27. News and updates – Bitstamp NEW RESEARCH: The state of Bitcoin as collateral. - Read more × News INTRODUCING UNI, YFI AND SNX AT BITSTAMP WITH ZERO FEES UNTIL THE END OF JULY! 26 APR 2021 We are further expanding our support for the growing DeFi space with another trio of new listings. The new assets each cover a unique use case and should be an exciting addition to the portfolios of both DeFi enthusiasts as well as rst-time entrants to the space. We are listing the following cryptocurrencies: ● Uniswap (UNI) – an automated trading and liquidity protocol that enables decentralized trading of tokens through the Uniswap DEX ● Yearn.nance (YFI) – a DeFi service created to help non-technical users maximize returns from yield farming ● Synthetix (SNX) – a DeFi protocol for creating on-chain derivatives (called synths) based on both crypto and non-crypto assets All of these cryptocurrencies will trade with zero fees until the end of July! Please note that for the time being, these assets will not be available to our US customers. Listing schedule: 1. Transfer-only mode: Deposits and withdrawals open but trading is not enabled yet. UNI, YFI, SNX: Monday, 3 May 2. Post-only mode: You will be able to place and cancel limit orders, but they will not be matched. Therefore, no orders will actually be completed during this stage. https://www.bitstamp.net/news/ 1/19 2021. 4. 27. News and updates – Bitstamp UNI: Tuesday, 4 May, at 8:00 AM UTC YFI: Wednesday, 5 May, at 8:00 AM UTC SNX: Thursday, 6 May,NEW at 8:00RESEARCH: AM UTC The state of Bitcoin as collateral. -
The Economic Limits of Bitcoin and the Blockchain∗†
The Economic Limits of Bitcoin and the Blockchain∗† Eric Budish‡ June 5, 2018 Abstract The amount of computational power devoted to anonymous, decentralized blockchains such as Bitcoin’s must simultaneously satisfy two conditions in equilibrium: (1) a zero-profit condition among miners, who engage in a rent-seeking competition for the prize associated with adding the next block to the chain; and (2) an incentive compatibility condition on the system’s vulnerability to a “majority attack”, namely that the computational costs of such an attack must exceed the benefits. Together, these two equations imply that (3) the recurring, “flow”, payments to miners for running the blockchain must be large relative to the one-off, “stock”, benefits of attacking it. This is very expensive! The constraint is softer (i.e., stock versus stock) if both (i) the mining technology used to run the blockchain is both scarce and non-repurposable, and (ii) any majority attack is a “sabotage” in that it causes a collapse in the economic value of the blockchain; however, reliance on non-repurposable technology for security and vulnerability to sabotage each raise their own concerns, and point to specific collapse scenarios. In particular, the model suggests that Bitcoin would be majority attacked if it became sufficiently economically important — e.g., if it became a “store of value” akin to gold — which suggests that there are intrinsic economic limits to how economically important it can become in the first place. ∗Project start date: Feb 18, 2018. First public draft: May 3, 2018. For the record, the first large-stakes majority attack of a well-known cryptocurrency, the $18M attack on Bitcoin Gold, occurred a few weeks later in mid-May 2018 (Wilmoth, 2018; Wong, 2018). -
Creation and Resilience of Decentralized Brands: Bitcoin & The
Creation and Resilience of Decentralized Brands: Bitcoin & the Blockchain Syeda Mariam Humayun A dissertation submitted to the Faculty of Graduate Studies in partial fulfillment of the requirements for the degree of Doctor of Philosophy Graduate Program in Administration Schulich School of Business York University Toronto, Ontario March 2019 © Syeda Mariam Humayun 2019 Abstract: This dissertation is based on a longitudinal ethnographic and netnographic study of the Bitcoin and broader Blockchain community. The data is drawn from 38 in-depth interviews and 200+ informal interviews, plus archival news media sources, netnography, and participant observation conducted in multiple cities: Toronto, Amsterdam, Berlin, Miami, New York, Prague, San Francisco, Cancun, Boston/Cambridge, and Tokyo. Participation at Bitcoin/Blockchain conferences included: Consensus Conference New York, North American Bitcoin Conference, Satoshi Roundtable Cancun, MIT Business of Blockchain, and Scaling Bitcoin Tokyo. The research fieldwork was conducted between 2014-2018. The dissertation is structured as three papers: - “Satoshi is Dead. Long Live Satoshi.” The Curious Case of Bitcoin: This paper focuses on the myth of anonymity and how by remaining anonymous, Satoshi Nakamoto, was able to leave his creation open to widespread adoption. - Tracing the United Nodes of Bitcoin: This paper examines the intersection of religiosity, technology, and money in the Bitcoin community. - Our Brand Is Crisis: Creation and Resilience of Decentralized Brands – Bitcoin & the Blockchain: Drawing on ecological resilience framework as a conceptual metaphor this paper maps how various stabilizing and destabilizing forces in the Bitcoin ecosystem helped in the evolution of a decentralized brand and promulgated more mainstreaming of the Bitcoin brand. ii Dedication: To my younger brother, Umer. -
A Survey on Volatility Fluctuations in the Decentralized Cryptocurrency Financial Assets
Journal of Risk and Financial Management Review A Survey on Volatility Fluctuations in the Decentralized Cryptocurrency Financial Assets Nikolaos A. Kyriazis Department of Economics, University of Thessaly, 38333 Volos, Greece; [email protected] Abstract: This study is an integrated survey of GARCH methodologies applications on 67 empirical papers that focus on cryptocurrencies. More sophisticated GARCH models are found to better explain the fluctuations in the volatility of cryptocurrencies. The main characteristics and the optimal approaches for modeling returns and volatility of cryptocurrencies are under scrutiny. Moreover, emphasis is placed on interconnectedness and hedging and/or diversifying abilities, measurement of profit-making and risk, efficiency and herding behavior. This leads to fruitful results and sheds light on a broad spectrum of aspects. In-depth analysis is provided of the speculative character of digital currencies and the possibility of improvement of the risk–return trade-off in investors’ portfolios. Overall, it is found that the inclusion of Bitcoin in portfolios with conventional assets could significantly improve the risk–return trade-off of investors’ decisions. Results on whether Bitcoin resembles gold are split. The same is true about whether Bitcoins volatility presents larger reactions to positive or negative shocks. Cryptocurrency markets are found not to be efficient. This study provides a roadmap for researchers and investors as well as authorities. Keywords: decentralized cryptocurrency; Bitcoin; survey; volatility modelling Citation: Kyriazis, Nikolaos A. 2021. A Survey on Volatility Fluctuations in the Decentralized Cryptocurrency Financial Assets. Journal of Risk and 1. Introduction Financial Management 14: 293. The continuing evolution of cryptocurrency markets and exchanges during the last few https://doi.org/10.3390/jrfm years has aroused sparkling interest amid academic researchers, monetary policymakers, 14070293 regulators, investors and the financial press. -
Regulating the Bitcoin Ecosystem
Regulating The Bitcoin Ecosystem Master Thesis Rishabh Kapoor (4184009) Engineering and Policy Analysis Faculty of Technology Policy Management Delft University of Technology February, 2016 1 Title Regulating The Bitcoin Ecosystem Author Rishabh Kapoor Date February 1st, 2016 Email [email protected] University Delft University of Technology Faculty of Technology, Policy & Management Program Engineering and Policy Analysis Section Economics of Innovation Graduation Committee Chairman: Prof. Cees van Beers [Economics of Innovation] First Supervisor: Dr. Servaas Storm [Economics of Innovation] Second Supervisor: Dr. Filippo Santoni De Sio [Philosophy of Technology] 2 Acknowledgement This thesis is the final submission of my master studies which started in September 2011 as part of the Engineering and Policy Analysis program at Faculty of Technology, Policy & Management, TU Delft. My most sincere gratitude goes to my graduation committee. I'd like to thank Dr. Servaas Storm who guided and helped me during the whole graduation process and was kind enough to allow me the freedom to explore a new innovative theme. I really appreciate, that you helped me screen the papers which directly guided me to an in-depth research across disciplines. I gained a lot, from the efficient discussion each time as well. Also, Dr. Filippo Santoni De Sio, was very kind to give his valuable feedback in arranging the philosophy section better. Finally, Prof. Cees van Beers was helpful in his remarks for the practical applicability of the thesis. I also would like to thank Satoshi Nakomoto (Founder, Bitcoin) whoever he is for having the courage to give to the world this new financial model for us to think and rethink about society fundamentally and move towards balanced technology decentralization.