This thesis deals with cryptocurrencies and the underlying principles they are based on. It describes the blockchain technology and explores various cryptocurrencies that utilize it with the focus on their similarities and differences. The next part analyzes InsightAPI, the existing tool for real-time Bitcoin blockchain exploration. It then describes the proposed solution for the Ethereum blockchain explorer, highlights the implementation details, and shows results of its testing. The created tool allows the user to quickly gather information about desired blocks, users, and transactions of the Ethereum blockchain.

This master’s thesis predicts the development and assesses the potential of cryptocurrencies in the areas of investment, trade and technology based on their technical, economic and legal analysis. Although the thesis deals with cryptocurrencies in general, the key focus is placed on their most prominent representative (Bitcoin) in trying to predict the effects on the future of financial markets from a wide, multidisciplinary perspective.

Memoria (licenciado en ciencias jurídicas y sociales) / Las criptomonedas han significado una innovación enorme. La tecnología detrás de ellas puede ser usada para facilitar la conexión de redes, así como para actividades ilegales. También los Bancos Centrales a lo largo del mundo se han preocupado del crecimiento de ellas, dado que la autogeneración de emisión monetaria de manera descentralizada si se empieza a tener un uso masivo significativo podría eventualmente traer riesgos de liquidez. Así, se han formulado distintas regulaciones para prevenir algunos de estos problemas. De esta forma, en el presente trabajo pretendemos formular un análisis que pondere los costos y beneficios de las criptomonedas para incitar el debate en Chile, y con ello, evaluar el impacto de una hipotética regulación.

Bc. Opršálová, P. Cryptocurrencies – factors, development and risks. Diploma thesis, Brno: Mendel university in Brno, 2019. The diploma thesis discusses cryptocurrencies, mostly about bitcoin and factors that influence its price. Firstly, is introduced the basic concepts, history, development, risks and benefits of cryptocurrency. Subsequently, the best-known cryptocurrency of bitcoin is described, and the area of cryptocurrency regulation is analysed worldwide and in the Czech Republic. The core of the diploma thesis is an empirical part, which identify factors by regression analysis and the influence of individual factors on the bitcoin price and assess whether cryptocurrencies behave more like commodities than currency.

The development of the crypto market over the past decade, together with digitalization, has contributed to changes in payment options around the world. This study examines how different financial institutions in Sweden view bitcoin as a means of payment. In addition, trust in bitcoin and its impact on the institutions' operations are analyzed using legitimacy theory and legitimacy strategies. This is done through a qualitative approach with five interviews from different perspectives in the financial market. The study suggests that bitcoin is currently not considered an accepted means of payment in Sweden due to the high level of trust that Swedes have in financial institutions. It is rather seen as an asset and - according to some - an investment opportunity. Furthermore, it is concluded that there is an extensive need for the upcoming regulation of the crypto market. In addition, the study also shows how institutions keep themselves legitimate in relation to bitcoin and society's values regarding the crypto market, as well as their various applied strategies.

Decentralised cryptocurrencies such as Bitcoin offer a new paradigm of electronic payment systems that do not rely on a trusted third-party. Instead, the peers forming the network handle the task traditionally left to the third-party, preventing attackers from spending twice the same resource, and do so in a publicly verifiable way through Bitcoin's main innovation, the blockchain. However, due to a lack of synchrony in the network, Bitcoin peers may transiently have conflicting views of the system: the blockchain is forked. This can happen purely by accident but attackers can also voluntarily create forks to mount other attacks on the system. In this work, we describe Bitcoin and its underlying blockchain protocol; we introduce a formal model to capture the normal operations of the system as well as forks and double-spending attacks. We use it to define Bitcoin's fundamental properties in terms of safety, liveness and validity. We present the current state of the system: first, we analyse some of the most prominent works that academia has produced between 2008 and 2016, as well as some promising leads to improve the system; then, we use the results of a measurement campaign to show that the size of the network is relatively stable because join and leave operations compensate each other, and that blocks propagate to most of the network in a matter of seconds. We further compare our results to those usually accepted by the community. We introduce a Bitcoin network simulator that we have implemented and present the experiment we have performed to validate it. Finally, we propose a modification to Bitcoin's operations that can prevent double-spending attacks and forks without giving up on its main ideological principles, decentralisation and the absence of source of trust.

The Internet and other telecommunications systems have reshaped the means by which markets are accessed, generated, and transformed. Recent innovations in computer science have led to the development of a virtually bound, decentralized, encrypted currency system known as bitcoin. Unlike conventional currency systems, the Bitcoin protocol is cryptologically defined with a virtual structure that allows it to simultaneously operate as currency, commodity, and market shaping socio-political force. Its decentralized design permits it to function as a free-market response to fiat currencies vulnerable to inflation, regulation, and manipulation. Given the cultural significance anthropologists and other social scientists have assigned to various modes and mediums of exchange over the years, the socio-economic impact of this novel currency system warrants particular consideration. This research describes the Bitcoin community that has emerged alongside the currency, including the entrepreneurs, developers, and consumers who are dedicated to bitcoin’s perpetuation and acceptance as an internationally recognized medium of exchange. Ethnographic interviews and participant observation were utilized to collect information from users in the Central Florida area, detailing their experiences and interactions with the Bitcoin protocol and its associated community. This research provides new levels of anthropological insight into currency development, market interaction, and economically embodied social commentary. Moreover, its exploratory nature helps create a viable framework around which qualitative inquiry of virtual crypto-currencies may be designed in future studies.

The purpose of this dissertation is to examine the direct impact of cryptocurrencies, primarily Bitcoin, on stock returns, as well as to analyze the characteristics of some of the companies which Bitcoin has a large impact on stock returns and the reasons why these phenomena occur. The study examines the returns of three variables, NSDQ100 Index, Bitcoin price, and stock prices of 101 enterprises within NSDQ100 by analyzing the monthly ended figures over the past five years. As the nature of Bitcoin that cannot be directly linked to stock returns, the direct impact of Bitcoin on stock return was discussed and analyzed through two regression analyses of NSDQ100 returns and stock returns, as well as NSDQ100 returns, bitcoin returns and stock returns. This study concludes that the direct impact of Bitcoin on the stock returns of companies in the Technology and Consumer Discretionary sectors, which involve consumer goods, is significant; whereas its impact on the stock returns of companies in the Health Care sector and Consumer Discretionary sector that do not directly provide products is small. / Business Administration/Finance

Initial Coin Offerings (ICOs) came into worldwide attention in 2018, when over $11.6 billion flowed through them. The CME Group launched Bitcoin futures contracts in December 2017, giving large funds their first regulated exposure to digital assets. As digital assets move towards the mainstream of finance, institutional investors have followed. This study comparatively analyzes Hedge Fund investment in digital assets against that of other institutional investment firm types (Private Equity and Venture Capital) by analyzing their crypto holdings and rebuilding an equally weighted portfolio for each fund. Under these conditions, the study succeeds in finding significant differences between hedge fund results in the sample and those of private equity/venture capital firms. Specifically, this study shows through the composite portfolios built that digital asset investments made by hedge funds generate a much higher return than that of private equity and venture capital firms. Average hedge fund investments have much higher trading volumes and market capitalizations than those made by private equity and venture capital firms, suggesting that PE and VC firms are taking higher risks by investing in new and little-known crypto projects. The results of this study signal that the hedge fund business model is much better suited for the high-risk, high-volatility cryptocurrency market than strategies employed by venture capital and private equity firms.

No / The surprise advent of the peer-to-peer payment system Bitcoin in 2009 has raised various concerns regarding its relationship to established economic market ideologies. Unlike fiat currencies, Bitcoin is based on open-source software; it is a secure cryptocurrency, traded as an investment between two individuals over the internet, with no bank involvement. Computationally, this is a very innovative solution, but Bitcoin’s popularity has raised a number of security and trust concerns among mainstream economists. With cities and countries, including San Francisco and Germany, using Bitcoin as a unit of account in their financial systems, there is still a lack of understanding and a paucity of models for studying its use, and the role Bitcoin might play in real physical economies. This project tackles these issues by analysing the ramifications of Bitcoin within economic models, by building a computational model of the currency to test its performance in financial market models. The project uses established agent-based modelling techniques to build a decentralised Bitcoin model, which can be ‘plugged into’ existing agent-based models of key economic and financial markets. This allows various metrics to be subjected to critical analysis, gauging the progress of digital economies equipped with Bitcoin usage. This project contributes to the themes of privacy, consent, security and trust in the digital economy and digital technologies, enabling new business models of direct relevance to NEMODE. As computer scientists, we consider Bitcoin from a technical perspective; this contrasts with and complements other current Bitcoin research, and helps document the realizable risks Bitcoin and similar currencies bring to our current economic world. This report outlines a comprehensive collection of risks raised by Bitcoin. Risk management is a discipline that can be used to address the possibility of future threats which may cause harm to the existing systems. Although there has been considerable work on analysing Bitcoin in terms of the potential issues it brings to the economic landscape, this report performs a first ever attempt of identifying the threats and risks posed by the use of Bitcoin from the perspective of computational modeling and engineering. In this project we consider risk at all levels of interaction when Bitcoin is introduced and transferred across the systems. We look at the infrastructure and the computational working of the digital currency to identify the potential risks it brings. Additional information can be seen in our forthcoming companion report on the detailed modeling of Bitcoin.