almost a decade down the peer-to-peer evolution, pseudo identity Satoshi Nakamoto released the first implementation of peer-to-peer trustless electronic cash ...
Tilburg University Department of Information Management
Degree of Doctor of Philosophy
Proposal Candidate: Joost de Kruijff
Supervisor: Associate Professor Hans Weigand
Proposed Study Title From Disruptive to Mainstream Technology: The Conceptualization and Application of Blockchain Technology Through the Lens of Ontology
Aim The aim of this study is to strengthen the theoretical foundation of blockchain by investigating the ontological concepts that form and surround the blockchain ecosystem.
Abstract Blockchain is the emergent technology that people talk about in finance, healthcare, real estate, entertainment, mobility and government, yet no one actually knows what it is in great detail. Existing blockchain literature lacks scientific rigor and is abundantly focused on technology features and future potential, without providing a reference point to what blockchain is as a concept. Therefore, the aim of this study is to strengthen the theoretical foundation of blockchain by investigating the ontological concepts that form and surround the blockchain ecosystem in order to provide guidance on what blockchain actually is instead of what it could become. This study adheres to calls from blockchain investors and stakeholders that more emphasis should be put in further understanding of the blockchain ecosystem instead of active exploitation of the status quo, which has resulted in an ambiguous and unstructured landscape characterized by an offspring of blockchain solutions, types, roadmaps and interpretations. There is need for consensus. This study aims to formalize blockchains’ fundament using ontological analyses, depicted in (Onto)UML and OCL, resulting in consensus, reusable cross-domain knowledge and formalized terminology that help to mature blockchain and eventually spur its adoption.
Rationale for the study Introduction For the past decades, the internet has seen advent of many bottom-up grassroots technologies that solve problems in a cooperative and distributed manner [4]. In particular, the sudden emergence of peer-to-peer technologies since the mid-2000s emphasized the strong desire by ordinary internet users to share content with each other and within their own control. Peer-to-peer proved to be a disruptive technology to many industries, like entertainment and finance. It turned out to be the muchneeded Heisenberg principle for the internet by transforming it to a two-way street where users could both send and receive data, instead of only the latter [5]. In 2009, almost a decade down the peer-to-peer evolution, pseudo identity Satoshi Nakamoto released the first implementation of peer-to-peer trustless electronic cash named Bitcoin. During the following years, Bitcoin took off and gained serious exposure as the main cryptocurrency. Nowadays, over 600 alternative digital currencies exist, also known as AltCoins or Altchains. Even though cryptocurrencies (and Bitcoin in particular) have received widespread recognition as an alternative to traditional payment systems, the key innovation of digital currencies is considered to be the blockchain mechanism and in specific the distributed ledger, also called a decentralized peer-validated time-stamped ledger that stores irreversible transactions [8]. The state of the ledger is managed through a consensus process to proof or verify the validity of transactions by the majority of network nodes. Blockchain allows a system to operate in an entirely distributed (and therefore also decentralized) way, without the need for a bank, government or any other intermediary to manage, control or manipulate it [9]. Even though blockchain is the emergent technology that people talk about in finance, healthcare, real estate, entertainment and government, no one actually knows what it is in great detail [1].
In addition, Pilkington [2] states that blockchain
research arguably lacks scientific rigor due to its young age and is primarily concerned with what blockchain could become as a disruptive technology for the Internet of Things (IoT). In addition, Glaser and Bezzenberger [3] state that existing academic literature regarding cryptocurrency and blockchain is predominantly written from either an economic- or technical perspective, like the various types of blockchains [1,2,13], ledgers [1,13], consensus mechanisms [3,13], cryptocurrencies [4,5,6,8,9] and governance mechanisms [7,10]. To date, no paper provides a grand overview of the entire blockchain concept and ecosystem across the various types and implementations, thereby missing the opportunity to reduce ambiguity and formalize the blockchain concept. This scientific reality is also evident in blockchain trials in the financial services industry, that missed the opportunity to develop an
industry wide blockchain solution as many banks, unsure of what blockchain can do for their organization, choose to develop their own propriety implementation instead of joining collective blockchain tests by peer (e.g. R3cev). The result is an offspring of blockchain solutions, types and roadmaps and interpretations. There is need for consensus.
Statement of purpose For blockchain to be accepted as a technology standard in established industries, it is pivotal that ordinary internet users and business executives have a basic yet fundamental understanding of the workings and impact of blockchain as a concept. Therefore, this study primarily aims to provide guidance on what blockchain actually is instead of what it could become by using an ontological approach. The knowledge engineering community refers to an (information technology) ontology as a ‘shared explicit specification of conceptualizations’ [18]. A blockchain ontology may benefit knowledge sharing, knowledge reuse and the establishment of consensus. Thorough understanding of the blockchain concept, types of blockchain transactions (e.g. smart contracts) and the blockchain ecosystem, including side- and altchains is essential for adoption and adheres to calls from blockchain investors that more emphasis should be put in further understanding of the blockchain ecosystem instead of active exploitation of the status quo [2]. As common with emerging technologies, multiple interpretations of terms exist in literature and beyond. Blockchain is no exception. As of yet, no formal logical blockchain model or terminology exists that is applicable for research purposes, resulting in confusion and misunderstanding.
For example, the terms
‘blockchain’ versus ‘distributed ledger’ are used interchangeably and often confused. Some mention ‘permissioned blockchains’ and others ‘private distributed ledgers’, which refer essentially to the same concept. Idem dito for the arbitrary usage of ‘tokens’ versus ‘public/private keys’, which is confusing even for those with a basic understanding of information security concepts. Ontology, as part of epistemology (theory of knowledge),
has been
recognized as a useful instrument for reducing these conceptual ambiguities and inconsistencies and identify value-creating capabilities in a certain domain [11]. Ontologies are becoming increasingly important tools for structuring domains of interests [24] and can be described as explicit declarative semantic models that have the objective to enable to practice a higher level knowledge acquisition and reuse [21], by using formally specified models defining the concepts used to describe domains and the relationships between them [23]. These models enable to visualize a system and to specify the structure or behavior of a system [21]. Noy and
McGuinness [20] identified that ontologies are developed to (1) to share common understanding of the structure of information among people or digital agents, (2) to enable reuse of domain knowledge, (3) to make domain assumptions explicit, (4) to separate domain knowledge from the operational knowledge and (5) to analyze domain knowledge. Originally, ontologies have been solely confined to philosophy (e.g. Aristotle’s Metaphysics), but have gained widespread importance in current events as alternative formalisms in artificial intelligence, databases and computational linguistics like Object- Oriented Analysis [22, 23]. Object- Oriented Analysis, design and implementation is a maturing field with many industry standards emerging for distributed computation, like the Object Management Group’s Unified Modeling Language (UML) together with its associated Object Constraint Language (OCL) [23]. This study aims to formalize blockchains’ fundaments using ontological analyses depicted in (Onto)UML and OCL aiming for consensus, reusable cross-domain knowledge and formalized terminology that help to mature blockchain and accelerate its rate of adoption. In order to decide on the applicability and adoption of blockchain within organizations (governments and enterprises), it would be insufficient to study blockchain only from an information systems’ perspective. Therefore, the ontologies designed in this study adhere to terms and definitions relevant to enterprises, also known as Enterprise Ontology. Scientists stressed that it is pivotal to choose the most effective level of abstraction during enterprise ontology development in order to establish a clear separation of concerns [25]. Therefore, an ontology is centered around the construction and operation of a system and is entirely separated from the functioning and behavior (the operation) of that system. Enterprise ontology distinguishes essential, infological and datalogical levels. Hereby, the datalogical level is concerned about uttering (speaking, writing) and perceiving (listening, reading), meaning that it stores, transmits, copies, destroys, etcetera. information. Elements at the infological level express thoughts (formulating) or educe thought (interpreting). Production acts at the forma level are infological in nature, meaning that they reproduce, deduce, reason, compute, etcetera. The essential level is ontological by nature, concerned with new, original things, directly or indirectly by communication, meaning that they decide or judge about something. The ontologies that will be designed in this study are abstracted at each of these levels and will be positioned and presented based on the purpose and audience of the ontology.
Research questions This main research question of this study is: How can ontological analysis contribute, by means of abstraction and conceptualization, to build consensus and create reusable cross-domain knowledge and specific formalized terminology for the blockchain ecosystem? Answers to the following research questions should result in a concise answer on the main research question. •
How can datalogical, infological and essential abstraction layers, derived from enterprise ontology, be applied to blockchain and what purpose would each of these abstraction layers have?
•
What domain ontologies could be developed for each mentioned abstraction layer in order to support basic understanding and consensus towards blockchain?
•
Blockchain is thought to have strong impact on related concepts and frameworks in established scientific disciplines. How could the blockchain ontologies developed in this study be mapped to ontologies in these related disciplines like accounting, ledgers and governance?
•
What value-creating capabilities do ontologies discover for blockchain using ontologies?
•
How could compliancy sets derived from unified foundational ontology be applied to each mentioned abstraction layer in order to support cross-domain consensus towards blockchain?
•
What Information Management research framework for blockchain could be derived from blockchain ontologies?
•
What generic blockchain terminology and ruleset could be used to reflect the various blockchain types and interactions between these types?
•
How could blockchain contract languages be conceptualized in order to define generic contract rules and regulations?
Significance of the study It is envisaged that this study will make a theoretical contribution to the body of knowledge related to both knowledge engineering and blockchain. With regard to the latter, the significance of this study can be broken down in two parts: (1) the importance of blockchain as a research subject and (2) the importance of basic yet fundamental understanding of blockchain itself.
The importance of blockchain Since the creation of the internet, not much has changed to the protocols used (e.g. HTTP, TCP IP), even though it has grown from an experiment to basically the backbone of the modern world. As with any item of interest, the internet has also become a magnet for abuse, fraud and thievery, mainly because the original protocols have no security features built-in. Users are dependent on security products that are plastered on top of their network or system, like firewalls, anti-spyware software, intrusion detection toolkits, etcetera. Although blockchains that implement consensus by just mining are potentially vulnerable to 51% attacks, Blockchain has security built-in its protocol, safeguarding against data manipulation and making transactions irreversible. Besides security, There are calls for more digital decentralization of power [30]. Over the recent decade, decentralized topologies and non-discriminatory protocols (e.g. peer-to-peer) have been replaced by a recentralization of infrastructure, as powerful corporations and secret services gatekeep global networks to earn money or to prevent terrorism. All data is accessible, but this access is mediated by these centralized entities. Whoever controls the access to data exercises political and economic control over ordinary people, businesses and introduce unnecessary intermediation [36]. With trust, property and governance ‘architectedin’, blockchain has the potential to fulfill the need for digital decentralization.
The fundamental understanding of blockchain Given the potential of blockchain for the digital world, it is pivotal to have a basic yet fundamental understanding in order for internet users, executives and governments to embrace blockchain and decide to use it. Ontologies can be used as a tool to form an opinion and support decision making due to the fact that successful decision making is dependent on having fundamental knowledge and clear guidance on how to decide [26]. Without guidance, decision makers will continue to rely solely on the tools and concepts they know best in an honest but misguided attempt to impose logic and structure on their make-or-break decisions. Therefore, besides fundamental understanding, this study also aims to provide guidance to decision makers by presenting the logical blockchain concept from multiple angles, abstractions and use-cases that fit their day-to-day experience.
Methodology Research design According to [31], ontology can be defined as ‘the science or study of being’ and it deals with the nature of reality. Ontology is a system of belief that reflects an interpretation of an individual about what constitutes a fact. In simple terms, ontology is associated with a central question of whether social entities need to be perceived as objective or subjective. Objectivism, as defined by [32], is the belief that truth and meaning reside within an object and is independent of human subjectivity. On the other hand, subjectivism is the belief that knowledge is ‘always filtered through the lenses of language, gender, social class, race, and ethnicity’ [33]. This study adheres to UML/OCL principles for domain ontology design to define a common vocabulary for researchers who need to share information in the blockchain domain and includes machine-interpretable definitions of basic concepts in the domain and relations among them. As part of this qualitative approach to the study using interdisciplinary postmodern methods of reading, analyzing and validating data, the researcher follows the patterns of design research to derive objective outcomes. Hereby, the researcher answers questions relevant to problems via the creation of innovative artifacts that contribute new knowledge to the body of scientific evidence. The designed artifacts are both useful and fundamental in understanding the problem [38]. Design research originates from both behavioral science and design science. According to [38], behavioral science addresses research through the development and justification of theories that explain or predict phenomena related to the identified business need. On the other hand, design science addresses research through the building and evaluation of artifacts designed to meet the identified business need. The goal of behavioral-science research is truth, whereas the goal of design-science research is utility. As argued above, truth and utility are inseparable, as truth informs design and utility informs theory. This study will use this development/justification to building/evaluating cycle to derive objective research outcomes for blockchain.
Limitations Literature signifies a juxtaposition between philosophers and information system scientists with regard to ontology. According to Glock [27], proper philosophy principally does not make claims about reality, but instead focuses on the conceptual framework that common sense and science employ in describing reality. In contrast to philosophers, information system scientist additionally focus on validating their theories and conceptual frameworks until they are fit to make objective claims about reality. This study follows the information system science approach without ignoring important philosophical concepts and literature. Ontologies should be concerned and limited to the following two problems; (1) what kind of things exist and (2) what is the nature or essence of these kinds?
[27]. This study follows this ordered pattern during the process of designing ontologies. Even though the analyses in this study intent to capture all relevant kinds within the blockchain ecosystem, it may not provide an all-inclusive or all-conclusive blockchain foundation. There may be specific subjects that are either not included in this study by choice, or simply do not exist as of yet. As no single correct ontology-design methodology exists, this study does not claim to define one. There are many pitfalls when it comes to ontology development [28], whereby ontology developers must tackle a wide range of difficulties and handicaps, which can result in the appearance of anomalies in the resulting ontologies. As blockchain lacks scientific maturity, the difficulty and handicaps (e.g. lack of reference material) increase the complexity of building and validating theories and ontologies. This complexity, in combination with the researcher’s novice ontology development status, may impact the outcomes of this study.
Potential outcomes According to [20], analyzing domain knowledge is only possible once a declarative specification of the terms is available, whereafter formal analysis of these terms is considered to be extremely valuable when both attempting to reuse existing ontologies and extending them. This study aims to establish scientific rigor for blockchain by creating a research framework that includes the declarative specification of terms that can be formally analyzed, referenced to and extended by researchers. Eventually, this may lead to a well established scientific foundation for blockchain. In addition, Governments and businesses may also use the acquired knowledge to develop strategies for incorporating blockchain technology into their processes, products and services. Without critical evaluation of today’s articles, blogs, white papers and newsflashes considering blockchain technology, one would start to believe that blockchain will change any problem with respect to transparency, fraud and equal distribution of money. Blockchain is hyped like peer-to-peer was in the early 2000s [29]. In order to predict if blockchain is able to transform from a hype into the new internet, it is time to take a step back. Aristotle’s definition of time, or ontological status of ‘now’, states something that ‘is’ should always precede something that ‘is not a fact at present‘ [37]. As this study primarily aims to explore what blockchain ‘is’ instead of what it ‘could become’ in order to strengthen blockchain’s theoretical foundation and set a realistic outlook for its’ potential. Since the inception of Bitcoin, various promising papers have been released with regard to blockchain’s possibilities like smart contracts [31], on- and off chain operations [35], intermediation [36] and governance [7,10]. Unfortunately, these papers have predominantly chosen a single
blockchain provider as a reference for their subject or made assumptions with respect to the inner workings of blockchain as a concept. As a result, these studies provide biased and inconclusive outcomes that possess little ontological value. A realistic validation of blockchain’s potential should take into account the basics of blockchain across the various providers, frameworks and implementations, taking into account the entire blockchain ecosystem including interactions between blockchains by through sidechains or API’s.
Planning The holistic research planning outlined in this sectioned has been drafted in consultation with the potential supervisor and takes the deadlines of targeted conferences and journals into account.
Paper 1: CAiSE 2017 (Essen, 13 June 2017) A Layered Blockchain Ontology Problem addressed: The blockchain domain lacks conceptual abstraction and important ontological distinctions Paper 2: ECIS 2017 (Portugal, 5 June 2017) Towards an Information Management Research Framework for Blockchain Problem addressed: Providing insight in the business implications of blockchain Year 1 Value Modeling & Business Ontologies (Luxembourg, 6 March 2017) Paper 1workshop presentation Paper 3: RCIS 2017 A Blockchain Technology Reference Model based on UFO-S. Problem addressed: Confusion on blockchain terminology Paper 4: RuleML (July 2017) A Rule-ML based Smart Contract Language for BT Problem addressed: Standardizing the many blockchain implementations with different and often low-level languages Year 2 1. Focus on the extension of research work 2. Focus on one or more journal articles Year 3 Start thesis construction Year 4+ To be decided
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