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About this book

Blockchain and other trustless systems have gone from being relatively obscure technologies, which were only known to a small community of computer scientists and cryptologists, to mainstream phenomena that are now considered powerful game changers for many industries. This book explores and assesses real-world use cases and case studies on blockchain and related technologies. The studies describe the respective applications and address how these technologies have been deployed, the rationale behind their application, and finally, their outcomes. The book shares a wealth of experiences and lessons learned regarding financial markets, energy, SCM, healthcare, law and compliance. Given its scope, it is chiefly intended for academics and practitioners who want to learn more about blockchain applications.

Table of Contents

Frontmatter

Toward More Rigorous Blockchain Research: Recommendations for Writing Blockchain Case Studies

Abstract
About a decade ago the fundamental operating principle of the Blockchain was introduced. It took several years before the technology gained widespread recognition in industry and academic communities outside of the computer science sphere. Since then many academic communities have taken up the topic, but so far no well-defined research agenda has emerged: research topics are scattered and rigorous approaches are scarce. More often than not, use cases implemented by industry apply a trial and error approach and there exists a dearth of theory-based academic papers on the topic following robust methodologies. Being a nascent research topic, case studies on Blockchain applications are a suitable approach to systematically transfer industry experience into research agendas which benefit both theory development and testing as well as design science research. In this paper I offer guidelines and suggestions on how to design and structure Blockchain case studies to create value for academia and the industry. More specifically, I describe Blockchain characteristics and challenges, present existing Blockchain case studies, and discuss various types of case study research and how they can be useful for industry and academic research. I conclude with a framework and a checklist for Blockchain case study research.
Horst Treiblmaier

From a Use Case Categorization Scheme Towards a Maturity Model for Engineering Distributed Ledgers

Abstract
This contribution focuses on the maturity of the engineering of business applications for a trusted collaboration in business networks. Distributed ledgers emerge as technology enabler for establishing trust across business partners while blockchain is often used as a synonym. Hence, mature knowledge for application engineering and quality assured methods for selecting technology platforms for distributed collaboration are essential. When choosing a Distributed Ledger Technology (DLT) it is difficult to compare the different technologies in order to identify the one technology best suitable for a specific use case. Platforms’ maturity for distributed ledgers cannot be assessed sufficiently. Detailed knowledge about the technological details of platforms and functional characteristics are sometimes sparse. To start with, we propose a characterization approach for distributed ledgers based on various classification schemas. This characterization is founded in an evaluation of use cases and prototypical implementations as well as a record of projects conducted. The approach allows one to sort out unsuitable technologies at an early stage. Since the automation of business cooperation is one of the core benefits of DLT, Smart Contracts for the automation of business processes and Distributed Autonomous Organizations (DAO) for the specification of collaboration networks furnish a key benefit for business re-engineering with DLT. Levels of maturity for collaboration specification are defined to distinguish different computational and organizational powers in contract enforcements.
Thomas Osterland, Thomas Rose

What’s in the Box? Combating Counterfeit Medications in Pharmaceutical Supply Chains with Blockchain Vigilant Information Systems

Abstract
Counterfeit medications, medication overprescribing and a slow antiquated process encompassed in recalling batches of medications represent serious supply chain concerns for the pharmaceutical industry. Blockchain, the technology underpinning the Bitcoin cryptocurrency, has been touted as a possible solution and panacea for the pharmaceutical industry to overcome the aforementioned concerns. Vigilant information systems enable organisations to make quick decisions in real-time in dynamic supply chain environments. Currently, the concept of blockchain vigilant information systems and their impact on supply chain decision making has not been researched in the pharmaceutical industry. Consequently, using an inductive grounded theory approach, we investigate pharmaceutical blockchain use cases and present an emergent multi-layer pharmaceutical blockchain vigilant information system (PBVIS) model. The various capabilities of each layer for pharmaceutical supply chain stakeholders are discussed. Research implications and fruitful avenues for future research studies are also presented in this chapter.
Trevor Clohessy, Saima Clohessy

A Use Case of Blockchain in Healthcare: Allergy Card

Abstract
Blockchain has often been mentioned in recent years as being a promising innovation for the healthcare sector in that it can ensure the secure exchange and traceability of information while respecting the regulatory framework for the confidentiality and portability of healthcare data. However, concrete cases remain very rare in the literature, and we investigate relevant use cases applying blockchain in healthcare. This chapter shows how we design a blockchain-based allergy card to solve real-life issues that is register, share and trace information about drug allergies. Therefore, we iteratively use action design research to determine the needs, design solution, develop the application and evaluate outcomes by involving stakeholders in the construction and evaluation.
Rhode Ghislaine Nguewo Ngassam, Roxana Ologeanu-Taddei, Jorick Lartigau, Isabelle Bourdon

International Exchange of Financial Information on Distributed Ledgers: Outlook and Design Blueprint

Abstract
The international fiscal system is made by multiple entities that are struggling to establish sound mechanisms for co-operation. Policy initiatives are currently aiming at strengthening the information sharing of financial information for tax purposes across jurisdictions. In this work, I outline the legal landscape for the exchange of information and establish four desirable principles to which information exchange should adhere. Then, I argue that distributed ledger technology appears well-suited to address some of the challenges related to the exchange of financial information. I explore possible designs and lay the foundation for future discussion.
Marco Crepaldi

A Blockchain Supported Solution for Compliant Digital Security Offerings

Abstract
Ethereum launched in 2015 ushering a sea change over its predecessors in it’s ability to tokenise an asset. This was a technical innovation and an Initial Coin Offering (ICO) boom ensued, peaking in 2017. The legal and compliance requirements of tokenisation failed to keep step in these early stages, but were eventually brought to bear after the ICO bubble burst, forcing technological liberalism to confront regulatory realities. The Digital Security Offering (DSO)—a name change intended to reflect full compliance—was coined. However, truly executing a fully compliant DSO remained elusive for many. In this chapter we navigate the regulatory landscape for DSOs and construct a compliant blockchain solution, using it to support the DSO capital raise for a product named Talketh in December of 2018. The journey discusses the key compliance concerns of Know-Your-Customer (KYC), Anti-Money-Laundering (AML), Custody, Tokenisation and onward secondary trading as part of a Distributed Exchange (DEX).
Andrew Le Gear

A Blockchain-Driven Approach to Fulfill the GDPR Recording Requirements

Abstract
On 25th May 2018, the European General Data Protection Regulation (GDPR) came into effect and required transformation into national legislation in all member states of the European Union. GDPR stipulates that businesses may only process personal data on documented instructions. Furthermore, article 33 paragraph 5 states that any personal data breach and its effects have to be documented. As a conclusion, any processing (article 4 paragraph 2) has to be recorded in an appropriate manner. To this end, Blockchain technology presents a suitable approach. Blockchain technology has clear advantages in comparison to classical recording techniques, which can be manipulated and deleted more easily. The use case described in this chapter is the application of Blockchain technology to fulfill the GDPR documentation requirements for a Log Management System (LMS). The purpose is to monitor sensitive data (files or folders) that can be defined via a configuration. To facilitate recording in an appropriate manner, a private and distributed architecture of a Blockchain with a two-level hierarchy is described. In the data block the SuperBlockchain (higher level) contains a SubBlockchain (lower level) which stores the log file information. The SubBlockchain is valid for a specific time span e.g. for one day, which speeds up any search in the log files in the case of an incident.
Wolfgang Radinger-Peer, Bernhard Kolm

Wibson: A Case Study of a Decentralized, Privacy-Preserving Data Marketplace

Abstract
The Internet offers unprecedented opportunities to collect large amounts of personal data at low cost. Typically, it is not only the data collection process but also their further use which is opaque to the individuals. Blockchain technology promises to return Internet users control over their personal data. In this chapter we present and discuss Wibson, a decentralized data marketplace based on the blockchain that provides a way for individuals to control and monetize their personal information in a trusted environment. By using a token and blockchain-enabled smart contracts Wibson allows data sellers and buyers to interact while allowing them to keep their desired level of anonymity. This chapter is based on qualitative interviews and the thorough analysis of the technical documentation. We describe the underlying rationale and functioning of Wibson and provide suggestions for future research at the intersection of blockchain and privacy.
Matias Travizano, Carlos Sarraute, Mateusz Dolata, Aaron M. French, Horst Treiblmaier

Business Process Transformation in Natural Resources Development Using Blockchain: Indigenous Entrepreneurship, Trustless Technology, and Rebuilding Trust

Abstract
Worldwide, there are many Indigenous (the convention in literature for capitalizing “Indigenous” in referring to people is used in this document). communities who distrust the Natural Resources industry due to historical economic, environmental, social, and cultural practices. These communities also often distrust National and Sub-National governments that regulate these industries. At the same time, long-term support and a license to operate from local Indigenous communities has become a critical and necessary requirement for Natural Resource Development. Blockchain constitutes an emerging technology that can be applied to mitigate trust issues, in contexts where there is distrust between decentralized stakeholders. In this chapter, we posit that those business processes that require participation by Indigenous communities, Natural Resources companies, and different levels of governments who lack trust in each other can be performed more effectively using blockchain technologies. The research method included interviews with the Natural Resource industry and Indigenous entrepreneurship subject matter experts, and a case study using an enterprise analysis tool, the Business Model Canvas. Ultimately, our research indicates that governance level control by Indigenous communities over the development and operation of blockchain platforms can be pivotal in rebuilding trust between stakeholders in Natural Resources development. In our findings, control of development and operation by Indigenous communities does not necessarily mean hands on end to end solution deployment, but involves continuous and genuine input into the requirements and direction of blockchain technology development. In the evolving response to the long-term issues of distrust between stakeholders involved in Natural Resource projects, this paper also describes the potential for long-term Smart Contracts, a blockchain technology enabled solution that continues to demonstrate promising applications. Long-term Smart Contract implementation, which can span multiple decades similar to long-term legal contracts, provide an additional layer of assurance that agreements made by all stakeholders involved will be honored through an additional mechanism of software code.
Ushnish Sengupta, Henry Kim

Smart City Applications on the Blockchain: Development of a Multi-layer Taxonomy

Abstract
Blockchain Technology (BT) has become widely recognized beyond the financial sector. Various other fields of application for the ground-breaking innovation are discussed by researchers and practitioners alike. One such field is the smart city. Driven by startups, projects aimed at alleviating negative effects of urbanization build on the properties of BT to improve quality of life, administrative processes, and environmental sustainability. Yet, due to the entrepreneurial dynamics and abundant fields of application for BT in smart cities, an integrated and boundary-spanning analysis is lacking. This study aims at developing a multi-layer taxonomy that illustrates how BT is used in different smart city business models. For this purpose, we identified a sample of 80 startups which offer applications for smart cities and examined their business models. The paper explores business model configurations and technological characteristics of blockchain-based smart city applications. We identify BT startup archetypes in several domains: sharing economy, privacy and security, and internet of things (IoT). The paper will be useful for researchers, practitioners, and regulators interested in gaining novel insights about how startups leverage BT to create and capture value.
Esther Nagel, Johann Kranz

A Case Study of Blockchain-Induced Digital Transformation in the Public Sector

Abstract
Public administration has long faced the challenge of addressing a steadily growing workload with limited resources. Blockchain and related technologies promise manifold applications which might alleviate this tension, but adoption may be hampered by the dearth of academic literature documenting existing use cases and the lessons learned from them. This case study examines a public administration use case which was initiated by the state government of South Tyrol in Northern Italy in cooperation with the firm SAP. Many important lessons have been learned in pursuit of the main project goal of streamlining the complex administrative processes surrounding the business of building and modifying cell towers. Exploiting the full potential of blockchain necessitates a complete rethinking of public management, yet holds the potential for a leaner and more service-oriented administration that reestablishes citizen trust in public institutions. However, several disadvantages also emerged, which highlight specific limitations of blockchain technologies. In this paper we apply a single case study approach and derive several best practices based on the analysis of qualitative interviews and rich project documentation.
Horst Treiblmaier, Christian Sillaber

Analyzing the Potential of DLT-based Applications in Smart Factories

Abstract
While companies struggle to implement Smart Factory initiatives, the emergence of decentralized Distributed Ledger Technology (DLT) promises to support Smart Factories. However, little is known about the extent to which DLT can support Smart Factory initiatives. Thus, this paper examines whether DLT is a useful addition to the Smart Factory concept in the context of Industry 4.0. The focus of the research lies on practical challenges that manufacturing companies are confronted with when creating Smart Factories and integrating them into their value chain. These challenges were worked out with the help of a literature review and interviews, which were conducted with employees of one of the most renowned industrial automation and digitization companies (undisclosed for confidentiality). Based on this, two DLT concepts were developed and discussed with the experts regarding their respective opportunities, risks, and feasibility. The DLT-based Audit Trail is intended to solve the challenge of creating a detailed, consistent and traceable overview of production processes, while the Crypto-based Agent Logic solves the challenge of setting priorities for orders in a fully automated production process. The results show that DLT integration in the context of the Smart Factory concept is to be regarded as useful and should be driven forward by further research.
Dominik Roeck, Felix Schöneseiffen, Michael Greger, Erik Hofmann

Next Generation Home Sharing: Disrupting Platform Organizations with Blockchain Technology and the Internet of Things?

Abstract
During the last decade, the sharing economy has given birth to a number of market mediators, which have grown to become the world’s most valuable companies. Centralized sharing platforms like Uber, Didi Chuxing, and Airbnb have transformed several traditional industries. However, with the rise of the blockchain technology, some voices predict that these platform companies will soon be at risk of being disrupted themselves. In this chapter, we address the question of whether blockchain technology has given birth to a new breed of sharing economy platforms that can challenge the incumbents’ business models. We identify five different stages of the application of blockchain technology in emerging home sharing startups. We use a stage model to explain the differences among various types of platforms, from which we derive the impact of their differences on potential market success. However, in the home sharing sector, simply copying Airbnb’s business model and rebuilding it with blockchain technology is not sufficient for any of the emerging startups to overcome the prevalent barriers to entry. Hence, we use our results to illustrate whether and under what conditions blockchain-based startups might be able to “change the game” in the home sharing economy. Our results indicate that most blockchain-based home sharing startups will likely not be able to truly challenge the incumbent platforms. Nevertheless, by analyzing the different ways of blockchain implementation in the home sharing sectors, we identify several critical factors that may increase the chance to prosper for emerging blockchain home sharing networks.
Patrick Schneck, Andranik Tumasjan, Isabell M. Welpe

Using Blockchain for Online Multimedia Management: Characteristics of Existing Platforms

Abstract
In this descriptive study we investigate the use of blockchain in the online multimedia industry. We analyze the content of 30 peer-reviewed academic publications, white papers and industry websites published between 2016 and 2018 which report the application of blockchain for multimedia management. This includes diverse use cases in the music and advertising industries, healthcare, social media, and content delivery networks. Ethereum was found to be the most popular blockchain and proof of work the favorite consensus mechanism. More than half of the platforms reward their users for content curation and community development. The majority of the platforms have implemented tokens and smart contracts to automate the distribution of earnings or to enable data access. Our study further shows that the majority of multimedia blockchain platforms have already implemented monetization capabilities.
Bikram Shrestha, Malka N. Halgamuge, Horst Treiblmaier

Supply Chain Visibility Ledger

Abstract
Improved situational awareness, also known as Supply Chain Visibility, contributes to better decisions with the ability to synchronize processes and reduce costs. It requires data sharing of for instance positions, speed, direction, and estimated time of arrival and—departure at locations of vessels, trucks, barges, and trains. Any two collaborating stakeholders might already be sharing these process ‘milestones’ in the context of a commercial relation, using a platform. Reception of a milestone by a stakeholder may be a trigger to inform a customer of the progress of its order or can be used to synchronize physical processes. First, this research chapter specifies supply chain visibility in more detail and secondly provides arguments for applying distributed ledger technology. These arguments address on the one hand near real-time share milestones in supply and logistics chains with a broadcast mechanism based on subscriptions and on the other hand large scale distribution and implementation of software on a distributed ledger. The latter raises issues of governance, that will be briefly touched upon. Scientific contributions of this research chapter are in ‘state’ validation of real-world objects as a means of mining, ontology-based input validation, and interaction sequence specification by a business process choreography.
Wout J. Hofman
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