Alex Norta, PhD.,

Department of

Informatics, TTU.ee

Tallinn, Estonia

What can Smart Contracts Do?

Agenda Introduction & DIY Blockchain/Bitcoin learning Current state in smart contracts/blockchain-tech

– Unsuitable smart-contract languages -> ADOPTION FAILURE– Lifecycle management lacking for smart contracts -> INSECURE

Business-collaboration model– Master/client- vs. P2P-collaboration– Detailed collaboration model

eSourcing Markup Language (eSML) Complete lifecycle for smart-contract management

– Setup– Rollout of decentralized governance infrastructure– Disrupting and calming rollbacks for conflict management– Termination

Startups and projects around Smart Contracts Conclusion and future work

Introduction My own journey towards Smart Contracts

– an accident

Introduction What is a contract? A contract is a written, or spoken agreement

especially one concerning employment, sales, or tenancy that is intended to be enforceable by law.– voluntarism– non-initiation of force– consensus

Introduction

What a contract really currently is? Dumb paper and ink (or now a dumb PDF) Underspecified Not process aware Can not be automated Hard to enforce Hard to trust

Introduction What are blockchains all about? Blockchain

– a distributed database (hash table)– maintains a growing list of data records– secured from tempering and revision– Main technical innovation for bitcoins

Introduction

http://www.en.bitcoinr.cz/includes/img/bitcoin.pdf

Introduction

Introduction Bitcoin as teaser only!! -> Smart Contracts

Bitcoins vs. Blockchains Bitcoin’s protocol layer underdeveloped Smart-contract languages have Turing

complete languages on the protocol layer The latter realize smart contracts technically

Introduction Smart Contracts

– machine readable code– legally valid

Introduction My own Smart-Contracts publications

Introduction Many solutions emerge where smart contracts matter:

Digital anarchy is comingLaw/business changes with smart contractsProofOfExistence service replaces notariesBlockchain ID as new stateless passportsUltraCoins to eliminate old financial systemBitHalo for smart contractsEthereum for smart contracts and next-generation distributed Internet systemsVitali Buterin won awards

Forefront of digital currency Bitnation for DIY country in clouds

Introduction Many sociotechnical applications where

smart contracts matter– e.g., cyber-physical systems

Cyber-Physicalsystem

A. Norta, M. Mahunnah, T. Tenso, K. Taveter and N. C. Narendra, "An Agent-Oriented Method for Designing Large Socio-technical Service-Ecosystems," 2014 IEEE World Congress on Services, Anchorage, AK, 2014, pp. 242-249. doi: 10.1109/SERVICES.2014.50

Blockain case

DIY Learning

Open-source learning about Blockchains:– Satoshi Nakamoto's paper about Bitcoins/blockchain– More papers at the Satoshi Nakamoto Institute– Many blockchain-tech publications now on scholar.google.com– Lectures:

• Harvard free Bitcoin and Cryptocurrency Technology Online Course• Princeton Bitcoin and Cryptocurrency lecture• Khan Academy has many videos about bitcoins• University of Nicosia Master Studies about Bitcoins/Blockchain

– Books:• Mastering Bitcoin by Antonopoulos, A.M.• Bitcoin and Cryptocurrency Technology, Narayanan, A. et al• More on Amazon

Sociotechnical Collaboration

BPaaS Contracting-HUB

Gap Detection

Gap: Existing smart-contract languages do not take into account sociotechnical suitability and expressiveness.– Lack of interaction-recognition between acting humans in organizations with

technology in workplaces– Suitability: concepts/properties to formulate real-world business-collaborations– Expressiveness: semantic language-construct clarity for uniform enactment

Research question: How to systematically develop a language and governance platform for cross-sociotechnical and contract-based system collaboration?– What is the collaboration context and model the specification language must cater

for? – What are the main suitability- and expressiveness concepts and -properties?

Business-Collaboration Model

P2P-Collaboration Model

Suitability Exploration Pattern-based

http://www.worldscientific.com/doi/abs/10.1142/S0218843007001664

Smart-contract ontology Smart-contract based Collaboration concepts & properties

Suitability Exploration Smart-contract based collaboration

– Who-concept

Suitability Exploration eContract-based collaboration

– Where-concept

Suitability Exploration eContract-based collaboration

– What-concept

Expressiveness Exploration

eXchangable Routing Language (XRL)– Instance-based workflow language– Petri-net semantics and XML syntax– Control-flow patterns give strong expressiveness

Every routing element has WF-net (Petri-net variant) semantics– Allows for soundness verification with tool support

Syntax is a tree– root element with exactly one routing element– Simple routing: no children routing elements– Complex routing: child-routing elements of specific order

eSourcing Markup Language

Econtracting Markup Language ECML is foundation

ECML delta towards eSouring – Incomplete suitability/expressiveness

Bold eSML definitions are extensions– Resource definition– Data definition

Who-extensions– resource/data-definition

What-extensions– Control-flow-patterns

Lifecycle definitions – Tasks/processes of collaborating parties– Mapped ontologically

Smart-Contract Platform Preventing another DAO hack scandal Lifecycle of a smart-contract Governance-as-a-Service

(GaaS) platform:– Startup phase: paper– Rollout & enactment phase: paper– Rollback & termination: paper

We use Colored Petri Nets for designing the GaaS– CPN is a graphical oriented language – design, specification, simulation and verification of systems– CPN-notation comprises

• states, denoted as circles• transitions, denoted as rectangles• arcs that connect states and transitions• tokens with color, i.e., attributes with values• CPN-ML expressions inscripted on arcs• modules in CPN are non-atomic place-holder nodes for

hierarchic refinements

Startup Phase: top-level lifecycle

Rollout Phase

Establishing a decentralized governanceinfrastructure(DGI)

Rollback Phase

http://ieeexplore.ieee.org/xpls/abs_all.jsp?arnumber=6337270&tag=1

Rollback & Termination

New enabling concepts and technologies for Smart Contracts– Blockchains in many variations and flavors – Service-oriented cloud computing (SOCC)– Business Process as a Service (BPaaS)– Cross-organizational eSourcing framework– Big data, mobile devices

eSourcing Reference Architecture

eSourcing Reference Architecture

Conclusion

Smart contracts miss the application layer -> INSECURE– Primarily technicalities driven bottom-up realization, e.g., Ethereum, Lisk, Synereo

eSML for smart contracts evolves out of systematic research– Top-down sociotechnical suitability/expressiveness exploration

Real-life contracting foundation for eSML– Process-views are subsets of larger in-house processes

The GaaS in a Cloud serves for managing the smart-contract lifecycle– Establishing a decentralized governance infrastructure

– We choose CPN Tools with formal, graphical modeling semantics Stages of the DGI-establishment lifecycle

– Copy local smart-contract copies per decentralized autonomous organization– Extract local policies, monitors, BNMA– Configure local services & communication endpoints

Mapping of lifecycle to eSRA architecture Qtum Smart-Contracts theme in Tallinn

Thank you for listening!

Q&A