Taxonomy of Blockchain Technologies. Principles of Identification and Classification (1708.04872v2)

Abstract: A comparative study across the most widely known blockchain technologies is conducted with a bottom-up approach. Blockchains are disentangled into building blocks. Each building block is then hierarchically classified in main and subcomponents. Then, alternative layouts for the subcomponents are identified and compared between them. Finally, a taxonomy tree summarises the study and provides a navigation tool across different blockchain architectural configurations.

• The paper develops a systematic taxonomy by deconstructing blockchain systems into fundamental components and classifying them into main and subcategories.
• It employs a bottom-up methodology to review blockchain literature and analyze diverse architectural layouts, including consensus, transaction models, and governance.
• The resulting taxonomy tree facilitates clearer comparison and evaluation of blockchain systems, promoting standardization and enhanced interoperability.

A Taxonomy of Blockchain Technologies: Principles of Identification and Classification

The paper investigates various blockchain technologies through a methodical bottom-up approach, aiming to construct a comprehensive taxonomy. This process begins by breaking down blockchains into fundamental building blocks and then categorizing these into main and subcomponents. The discerning evaluation of different technological layouts leads to the creation of a taxonomy tree that serves as a navigation tool, providing clarity across diverse blockchain architectural configurations.

Historical Context and Motivations

Blockchain technology, initially popularized by Bitcoin in 2008, combines existing technologies like distributed ledgers, public-key encryption, merkle tree hashing, and consensus protocols. While Bitcoin introduces the concept of decentralized, peer-validated cryptocurrencies, its individual components predate its inception, tracing back to innovations like the Merkle Tree. The potential applications of blockchain extend far beyond cryptocurrency, influencing sectors such as finance, with many banks and central banks researching blockchain-related projects.

The increasing heterogeneity in blockchain systems, caused by fast-paced evolution and innovation, presents challenges in interoperability and standardization—crucial factors in achieving wide-scale adoption across socio-economic systems.

Methodology

The research embraces the early phase of blockchain technological development known as "fermentation," characterized by a high degree of uncertainty and diversification. The paper acknowledges multiple architectural designs and emphasizes the necessity of standardizing components to facilitate innovation, legal consistency, and consumer protection.

The paper proposes a universal blockchain taxonomy aimed at categorizing and logically grouping blockchain components across several domains: digital currencies, application stacks, asset registry technologies, and asset-centric technologies. The authors' methodological approach comprises reviewing existing blockchain literature, defining a hierarchical taxonomy, and developing specific layouts for subcomponents.

Results: The Blockchain Taxonomy Tree

The taxonomy tree emerges from a comprehensive analysis of blockchain's core components, such as Consensus, Transaction Capabilities, Native Currency/Tokenization, Extensibility, Security and Privacy, and Identity Management. This classification enables a systematic evaluation and comparison of blockchain systems, supporting the development of software architectures and standards.

Key Components and Classifications

1. Consensus Mechanisms: Various mechanisms like Proof-of-Work (PoW) and Proof-of-Stake (PoS) are explored, each with distinct implications for energy efficiency, security, and system scalability.
2. Transaction Models: Differences in transaction models, such as the UTXO model applied by Bitcoin and the account/balance model by Ethereum, are highlighted, affecting the systems' scalability and data management strategies.
3. Tokenization and Native Currency: The paper examines how tokenization expands blockchain applications beyond financial assets, enabling diverse implementations such as asset registries and digital identity systems.
4. Security and Privacy Measures: The proliferation of blockchains poses potential security risks. The paper analyzes encryption techniques and privacy protocols, emphasizing their importance in safeguarding user data integrity and confidentiality.
5. Governance Structures: Distinctions are made between open-source community-driven governance and corporate or alliance-based governance models, each impacting the developmental trajectory and adoption of blockchain technologies.

Implications and Future Work

This taxonomy aids in navigating the complex landscape of blockchain architectures, facilitating the creation and evaluation of new blockchain applications. It sets the groundwork for potential standardization, which could propel blockchain technologies into broader, more integrated applications across sectors.

While this paper establishes foundational guidelines for blockchain taxonomy, rapid technological advancements necessitate continuous updates and refinements to these classifications. Researchers and practitioners should anticipate shifts in technological paradigms and remain adaptable to incorporate future innovations within this framework.

By organizing and standardizing blockchain components and their interrelations, the paper hopes to enhance blockchain's interoperability and reliability, ultimately fostering wider confidence and adoption across industries.