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Approaching Non-Disruptive Distributed Ledger Technologies
Luleå University of Technology, Department of Computer Science, Electrical and Space Engineering, Embedded Internet Systems Lab.ORCID iD: 0000-0002-9865-8753
Luleå University of Technology, Department of Computer Science, Electrical and Space Engineering, Computer Science.
Luleå University of Technology, Department of Computer Science, Electrical and Space Engineering, Computer Science.ORCID iD: 0000-0002-4031-2872
(English)Manuscript (preprint) (Other academic)
Abstract [en]

Distributed ledger technologies have been considered for a plethora of interesting use cases, ranging from supply chain integration to open medical journals. While able to facilitate novel forms of collaboration, the technologies also tend to break with existing business practices by imposing new requirements on cooperation governance, interaction privacy and contract making. In this paper, we identify distributed consensus algorithms and code-as-contracts as common causes of these paradigmatic divergences, and propose a system design that depends on neither of them. In particular, we present an experimental implementation of our Exchange Network architecture that uses a consensus procedure comparable to that of R3 Corda, but that models its interactions as negotiations about ownership exchanges rather than as function invocations and finite state machine transitions. Furthermore, we characterize the current cooperational paradigm and outline six requirements of adherence, as well as considering both how our own solution and how R3 Corda could fulfill them. We conclude that our design approach provides better opportunity for compatibility with conventional legal and business practices than the state-of-the-art.

Keywords [en]
Digital negotiation, digital cooperation, digital contracts, smart contracts, distributed ledger technology, blockchain, distributed consensus algorithms, business integration, digitalization.
National Category
Computer Systems
Research subject
Industrial Electronics
Identifiers
URN: urn:nbn:se:ltu:diva-74045OAI: oai:DiVA.org:ltu-74045DiVA, id: diva2:1318154
Projects
Productive 4.0Available from: 2019-05-27 Created: 2019-05-27 Last updated: 2019-06-17
In thesis
1. The Performance, Interoperability and Integration of Distributed Ledger Technologies
Open this publication in new window or tab >>The Performance, Interoperability and Integration of Distributed Ledger Technologies
2019 (English)Licentiate thesis, comprehensive summary (Other academic)
Abstract [en]

In the wake of the financial crisis of 2008, Bitcoin emerged as a radical new alternative to the fiat currencies of the traditional banking sector. Through the use of a novel kind of probabilistic consensus algorithm, Bitcoin proved it possible to guarantee the integrity of a digital currency by relying on network majority votes instead of trusted institutions. By showing that it was technically feasible to, at least to some extent, replace the entire banking sector with computers, many significant actors started asking what else this new technology could help automate. A subsequent, seemingly inevitable, wave of efforts produced a multitude of new distributed ledger systems, architectures and applications, all somehow attempting to leverage distributed consensus algorithms to replace trusted intermediaries, facilitating value ownership, transfer and regulation.

In this thesis, we scrutinize distributed ledger technologies in terms of how they could help facilitate the digitization of contractual cooperation, especially in the context of the supply chain and manufacturing industries. Concretely, we consider them from three distinct technical perspectives, (1) performance, (2) interoperability and (3) integration. Voting systems, with or without probabilistic mechanisms, require significant time and resources to operate, for which reason it becomes relevant to investigate how the costs of running those systems can be mitigated. In particular, we consider how a blockchain, a form of distributed ledger, can be pruned to in order to reduce disk space requirements. Furthermore, no technical system part of a larger business is an island, but will have to be able to interoperate with other systems to maximize the opportunity for automation. For this reason, we also consider how transparent message translation between systems could be facilitated, as well as presenting a formalism for expressing the syntactic structure of message payloads. Finally, we propose a concrete architecture, the Exchange Network, that models contractual interactions as negotiations about token exchanges rather than as function invocations and state machine transitions, which we argue lowers the barrier to compatibility with conventional legal and business practices.

Even if no more trusted institutions could be replaced by any forthcoming distributed ledger technologies, we believe contractual interactions becoming more digital would lead to an increased opportunity for using computers to monitor, assist or even directly participate in the negotiation, management and tracking of business agreements, which we see as more than enough to warrant the cost of further developing of the technology. Such computer involvement may not just save time and reduce costs, but could also enable new kinds of computer-driven economies. In the long run, this may enable new levels of resource optimization, and not just within large organizations, but also smaller companies, or even the homes of families and individuals.

Place, publisher, year, edition, pages
Luleå: Luleå University of Technology, 2019
Series
Licentiate thesis / Luleå University of Technology, ISSN 1402-1757
Keywords
blockchain, distributed ledger, distributed ledger technologies, industry 4.0, smart industries
National Category
Computer Systems
Research subject
Industrial Electronics
Identifiers
urn:nbn:se:ltu:diva-74046 (URN)978-91-7790-402-1 (ISBN)978-91-7790-403-8 (ISBN)
Presentation
2019-08-28, A1545, A-Huset, Luleå Universitet, 971 87, 09:00 (English)
Opponent
Supervisors
Available from: 2019-05-27 Created: 2019-05-27 Last updated: 2019-07-10Bibliographically approved

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Palm, EmanuelBodin, UlfSchelén, Olov

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