The Internet of Value A collection of articles from the UCL CBT Research and Industry Associate Community on how Blockchain and DLT are enabling the new Internet of Value 0 Disclaimer: Many different authors have written the chapters in this report. While the editors of this report have made reasonable efforts to verify sources, check for plagiarism and the accuracy of statements, the editorial team cannot exclude potential errors and omissions. The opinions expressed and content written in this report are the responsibility of the authors of the specific chapters (who are named in the specific chapters) and not those of their respective institutions and the University College London Centre for Blockchain Technologies or the editorial team. The authors declare under their own responsibility that their manuscripts are original, have not been published before or, if published, have been authorized by the editor for a new publication in this report. 1 Contents Contributors ..................................................................................................................... 3 Editors ................................................................................................................................................. 3 Authors ................................................................................................................................................ 3 Acknowledgements .......................................................................................................... 6 Forward ........................................................................................................................... 7 Executive Summary .......................................................................................................... 9 Chapter 1: How DLT will evolve in the Future .................................................................. 12 Part A: Blockchains, DLTs and the Future of Payments .................................................................... 13 Part B: Consensus: Proof-of-Work, of-Stake and Structural Alternatives ........................................ 20 Chapter 2: Defining the Internet of Value ........................................................................ 27 Chapter 3: The IoV and Financial Services ....................................................................... 36 Part A: The IoV and New Business Models in Finance ...................................................................... 37 Part B: The New IOV Financial Ecosystem ........................................................................................ 47 Chapter 4: The IoV and Media......................................................................................... 59 Part A: New Media Business Models to emerge from the IoV ......................................................... 60 Part B: Solving Challenges in the Media Sector with DLT ................................................................. 74 Chapter 5: The IoV and E-Commerce ............................................................................... 82 Part A: The IoV in Consumer Markets ............................................................................................... 83 Part B: Marketplaces and the IoV ..................................................................................................... 91 Part C: The IoV and the Circular Economy ........................................................................................ 95 Chapter 6: The IoV and Internet of Things ..................................................................... 105 Chapter 7: IoV and Systemic Risk .................................................................................. 114 Part A: Structure, Robustness and Efficiency of Networked Systems ............................................ 115 Part B: Potential Sources of IoV Systemic Risk ............................................................................... 122 Chapter 8: Governance and Privacy Issues from the IoV ................................................ 125 2 Contributors Editors Jiahua Xu is Research Project Manager and an Research Associate at the UCL CBT. She was previously a postdoctoral researcher at Swiss Federal Institute of Technology in Lausanne (EPFL), as well as a research associate at Harvard Business School. Nikhil Vadgama is the UCL CBT’s Deputy Director and an adjunct teaching fellow at the UCL School of Management. His research interests focus on emerging technologies and decentralised finance. He has experience in Industry in the Financial Services, Real Estate and Education Technology sectors. Paolo Tasca is a Digital Economist specialising in P2P financial systems. He has advised on blockchain technologies different international organisations including the EU Parliament and the United Nations. Paolo is a serial entrepreneur in the blockchain space and is also the founder and Executive Director of the UCL CBT. Authors Andy Yee is a technology policy expert. He is currently senior director of public policy for Visa and was previously with Google. He is co-chair of the Payments Committee of the FinTech Association of Hong Kong, and a Center for Strategic and International Studies 2017 Abshire-Inamori Leadership Academy International Fellow. Antony Welfare is a blockchain expert, dedicated to helping others understand the transformational potential of blockchain technology and implement this, particularly in enterprise organisations. He is also an advisor on blockchain to the UK government, a guest lecturer on UCL CBT’s blockchain programme, a member of Forbes Technology Council, a keynote speaker on blockchain and the author of The Retail Handbook. Chris Wyper is Director for the Consumer Markets Industry Strategy Group within Oracle, focussed on driving innovation with advanced technologies such as AI, IOT and Blockchain to address key market imperatives. He has a wealth of executive technology experience across retail, particularly large grocery retail, convenience retail and high-end, luxury retail. David Schwartz is Chief Technology Officer at Ripple. David is one of the original architects of the XRP Ledger. Prior to joining Ripple, David Schwartz was Chief Technical Officer for WebMaster Incorporated, a Santa Clara software developer. He developed encrypted cloud storage and enterprise messaging systems for organizations like CNN and the National Security Agency (NSA). Fabio Caccioli is an Associate Professor in the Department of Computer Science at University College London. He has been a research associate in the Centre for Risk Studies (University of Cambridge) and a postdoctoral fellow at the Santa Fe Institute. He holds a PhD in Statistical Physics from SISSA (Trieste, Italy). His research focuses on systemic risk, complex systems and network theory. Geri Cupi is CEO and co-founder of MonoChain that connects brands and retailers with blockchain- enabled certificates and sensors to authenticate products and combat counterfeiting in the circular economy. Since 2018 launch, the London-based company started a partnership with Oracle and opened offices in the U.S. and Kosovo. Hermann Elendner Senior Research Fellow at the Weizenbaum Institute for the Networked Society and a Research Associate of the UCL CBT. His primary research interests are Cryptocurrencies: Pricing, 3 Investments, and Portfolio Management, Cryptocurrency Markets: Micro-structure and Blockchain Protocols and Value Stabilisation. Horst Treiblmaier is a Professor in International Management at Modul University Vienna, Austria. He received a Ph.D. from WU Vienna and worked as a Visiting Professor at Purdue University, University of California, Los Angeles, and the University of British Columbia. His research focuses on the implications of blockchain technology. Josep Lluis de la Rosa Esteva focuses on research on DLT and its applications to intelligent agents, virtual currencies, and digital preservation. Notable blockchain projects he has been associated with are licens3d.com, venushina.org, welicense.io, or reciclos.cat. He is also a Professor at the University of Girona, Visiting Professor at ETH Zurich and a Research Associate of the UCL CBT. Mike Brookbanks has over 25 years’ experience determining how business challenges are addressed through technology innovation as an Enterprise Architect. His recent focus has been the application of DLT/Blockchain & AI, its governance and responsible innovation. He represents the BSI on ISO307. He is managing a programme with UK Government, & researching how DLT/Blockchain can reduce friction in international trade. Nicola Dimitri is Professor of Economics at the University of Siena (Italy), Research Associate at CBT (UCL) and Life Member at Clare Hall Cambridge (UK). His research interests focus on blockchain and cryptocurrencies, game and decision theory, mechanism design, public procurement. He published widely in peer reviewed internationally recognised journals. Nikolas Markou is the CTO of Electi Consulting a boutique consulting firm specializing in Blockchain Technologies and Artificial Intelligence solutions. He is also a Research Associate of the UCL CBT. A lifelong technologist, he holds a BEng/MEng in Computer Engineering from the University of Patras and MSc in Advanced Computing from Imperial College London. Paolo Tasca is a Digital Economist specialising in P2P financial systems. He has advised on blockchain technologies different international organisations including the EU Parliament