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The transparency challenge of blockchain in organizations

Author

Listed:
  • Johannes Sedlmeir

    (Project Group Business & Information Systems Engineering of the Fraunhofer FIT
    University of Bayreuth)

  • Jonathan Lautenschlager

    (Project Group Business & Information Systems Engineering of the Fraunhofer FIT
    University of Bayreuth)

  • Gilbert Fridgen

    (University of Luxembourg)

  • Nils Urbach

    (Frankfurt University of Applied Sciences)

Abstract

This position paper discusses the challenges of blockchain applications in businesses and the public sector related to an excessive degree of transparency. We first point out the types of sensitive data involved in different patterns of blockchain use cases. We then argue that the implications of blockchains’ information exposure caused by replicated transaction storage and execution go well beyond the often-mentioned conflicts with the GDPR’s “right to be forgotten” and may be more problematic than anticipated. In particular, we illustrate the trade-off between protecting sensitive information and increasing process efficiency through smart contracts. We also explore to which extent permissioned blockchains and novel applications of cryptographic technologies such as self-sovereign identities and zero-knowledge proofs can help overcome the transparency challenge and thus act as catalysts for blockchain adoption and diffusion in organizations.

Suggested Citation

  • Johannes Sedlmeir & Jonathan Lautenschlager & Gilbert Fridgen & Nils Urbach, 2022. "The transparency challenge of blockchain in organizations," Electronic Markets, Springer;IIM University of St. Gallen, vol. 32(3), pages 1779-1794, September.
    • Handle: RePEc:spr:elmark:v:32:y:2022:i:3:d:10.1007_s12525-022-00536-0
    DOI: 10.1007/s12525-022-00536-0
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    References listed on IDEAS

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    8. Johannes Sedlmeir & Reilly Smethurst & Alexander Rieger & Gilbert Fridgen, 2021. "Digital Identities and Verifiable Credentials," Business & Information Systems Engineering: The International Journal of WIRTSCHAFTSINFORMATIK, Springer;Gesellschaft für Informatik e.V. (GI), vol. 63(5), pages 603-613, October.
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    12. Andoni, Merlinda & Robu, Valentin & Flynn, David & Abram, Simone & Geach, Dale & Jenkins, David & McCallum, Peter & Peacock, Andrew, 2019. "Blockchain technology in the energy sector: A systematic review of challenges and opportunities," Renewable and Sustainable Energy Reviews, Elsevier, vol. 100(C), pages 143-174.
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    Citations

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    Cited by:

    1. Eduard Hartwich & Alexander Rieger & Johannes Sedlmeir & Dominik Jurek & Gilbert Fridgen, 2023. "Machine economies," Electronic Markets, Springer;IIM University of St. Gallen, vol. 33(1), pages 1-13, December.
    2. Roth, Tamara & Utz, Manuel & Baumgarte, Felix & Rieger, Alexander & Sedlmeir, Johannes & Strüker, Jens, 2022. "Electricity powered by blockchain: A review with a European perspective," Applied Energy, Elsevier, vol. 325(C).
    3. Gajendra Liyanaarachchi & Giampaolo Viglia & Fidan Kurtaliqi, 2024. "Addressing challenges of digital transformation with modified blockchain," Post-Print hal-04440365, HAL.
    4. Simon Feulner & Johannes Sedlmeir & Vincent Schlatt & Nils Urbach, 2022. "Exploring the use of self-sovereign identity for event ticketing systems," Electronic Markets, Springer;IIM University of St. Gallen, vol. 32(3), pages 1759-1777, September.
    5. Rainer Alt, 2022. "Electronic Markets on platform culture," Electronic Markets, Springer;IIM University of St. Gallen, vol. 32(3), pages 1019-1031, September.

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