Related papers: Contagion in Bitcoin networks
The blockchain paradigm provides a mechanism for content dissemination and distributed consensus on Peer-to-Peer (P2P) networks. While this paradigm has been widely adopted in industry, it has not been carefully analyzed in terms of its…
Common asset holdings are widely believed to have been the primary vector of contagion in the recent financial crisis. We develop a network approach to the amplification of financial contagion due to the combination of overlapping…
We study the real economic activity in the Bitcoin blockchain that involves transactions from/to retail users rather than between organizations such as marketplaces, exchanges, or other services. We first introduce a heuristic method to…
Blockchain (BC) systems are highly distributed peer-to-peer networks that offer an alternative to centralized services and promise robustness to coordinated attacks. However, the resilience and overall security of a BC system rests heavily…
As impressively shown by the financial crisis in 2007/08, contagion effects in financial networks harbor a great threat for the stability of the entire system. Without sufficient capital requirements for banks and other financial…
Cryptocurrencies as a new way of transferring assets and securing financial transactions have gained popularity in recent years. Transactions in cryptocurrencies are publicly available, hence, statistical studies on different aspects of…
Blockchain and its application on cryptocurrency transactions have gathered a lot of attention and popularity since the birth of the pioneer Bitcoin in 2009. More than 1500 cryptocurrencies are currently circulated in the market. The…
With the advent of decentralised digital currencies powered by blockchain technology, a new era of peer-to-peer transactions has commenced. The rapid growth of the cryptocurrency economy has led to increased use of transaction-enabling…
In the last years, cryptocurrencies are increasingly popular. Even people who are not experts have started to invest in these securities and nowadays cryptocurrency exchanges process transactions for over 100 billion US dollars per month.…
This paper investigates two mechanisms of financial contagion that are, firstly, the correlated exposure of banks to the same source of risk, and secondly the direct exposure of banks in the interbank market. It will consider a random…
The Lightning Network promises to alleviate Bitcoin's known scalability problems. The operation of such second layer approaches relies on the ability of participants to turn to the blockchain to claim funds at any time, which is assumed to…
The Lightning Network, a payment channel network with a market cap of over 192M USD, is designed to resolve Bitcoin's scalability issues through fast off-chain transactions. There are multiple Lightning Network client implementations, all…
The aim of this paper is to quantify and manage systemic risk caused by default contagion in the interbank market. We model the market as a random directed network, where the vertices represent financial institutions and the weighted edges…
Most permissionless blockchain networks run on peer-to-peer (P2P) networks, which offer flexibility and decentralization at the expense of performance (e.g., network latency). Historically, this tradeoff has not been a bottleneck for most…
Blockchain provides the unique and accountable channel for financial forensics by mining its open and immutable transaction data. A recent surge has been witnessed by training machine learning models with cryptocurrency transaction data for…
Contagion is an extremely important topic in finance. Contagion is at the core of most major financial crises, in particular the 2008 financial crisis. Although various approaches to quantifying contagion have been proposed, many of them…
We investigate connectedness within and across two major groups or assets: i) five popular cryptocurrencies, and ii) six major asset classes plus two commonly employed risk factors. Granger-causality tests uncover six direct channels of…
Transactions submitted through the blockchain peer-to-peer (P2P) network may leak out exploitable information. We study the economic incentives behind the adoption of blockchain dark venues, where users' transactions are observable only by…
We study the interplay between social ties and financial transactions made through a recent cryptocurrency called $\breve{G}1$. It has the particularity of combining the usual transaction record with a reliable network of identified users.…
Major cryptocurrency networks have relied on random peering choice rules for making connections in their peer-to-peer networks. Generally, these choices have good properties, particularly for open, permissionless networks. Random peering…