The Impact of Layer 2 Technologies on the Adoption and Security of Blockchain

Leonardo Maria De Rossi; Michel Avital; Rob Gleasure; Rebecca Solcia

The Impact of Layer 2 Technologies on the Adoption and Security of Blockchain

Leonardo Maria De Rossi, Michel Avital, Rob Gleasure, Rebecca Solcia

Institut for Digitalisering

Bocconi University

Publikation: Bidrag til bog/antologi/rapport › Konferencebidrag i proceedings › Forskning › peer review

Abstract

Numerous studies have raised concerns over the limited scalability of blockchain technologies and, in particular, Bitcoin. Layer 2 technologies have emerged as an advanced array of complementary innovations designed to solve this problem. Despite the growing optimism around layer 2 technologies, however, there is little evidence to show how they impact blockchain’s long-term success. This paper argues that the use and expansion of layer 2 technologies have a positive impact on the adoption and security levels of the underlying blockchain systems. Building on the Bitcoin and Lightning Network case, we use a time-series model based on 1,494 daily observations to demonstrate that the growing activity on the Lightning Network precipitates increased use and better security for Bitcoin. These results highlight the importance of layer 2 technologies for blockchain systems and suggest several further research avenues in this nascent domain of inquiry.

Originalsprog	Engelsk
Titel	Proceedings of the 43rd International Conference on Information Systems (ICIS) : Digitization for the Next Generation
Redaktører	Tilo Böhmann, Kai-Lung Hui, Viswanath Venkatesh
Antal sider	17
Udgivelsessted	Atlanta, GA
Forlag	Association for Information Systems. AIS Electronic Library (AISeL)
Publikationsdato	2022
Artikelnummer	1501
Status	Udgivet - 2022
Begivenhed	The 43rd International Conference on Information Systems: ICIS 2022: Digitization for the Next Generation - Copenhagen, Danmark Varighed: 9 dec. 2022 → 14 dec. 2022 Konferencens nummer: 43 https://icis2022.aisconferences.org/

Konference

Konference	The 43rd International Conference on Information Systems: ICIS 2022
Nummer	43
Land/Område	Danmark
By	Copenhagen
Periode	09/12/2022 → 14/12/2022
Internetadresse	https://icis2022.aisconferences.org/

Navn	Proceedings of the International Conference on Information Systems
ISSN	0000-0033

Emneord

Blockchain
Layer 2 technologies
Bitcoin
Lightning Network
Adoption
Security

Adgang til dokumentet

https://aisel.aisnet.org/icis2022/blockchain/blockchain/6/Licens: Ikke-specificeret

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Citationsformater

De Rossi, L. M., Avital, M., Gleasure, R., & Solcia, R. (2022). The Impact of Layer 2 Technologies on the Adoption and Security of Blockchain. I T. Böhmann, K.-L. Hui, & V. Venkatesh (red.), Proceedings of the 43rd International Conference on Information Systems (ICIS): Digitization for the Next Generation Artikel 1501 Association for Information Systems. AIS Electronic Library (AISeL). https://aisel.aisnet.org/icis2022/blockchain/blockchain/6/

De Rossi, Leonardo Maria ; Avital, Michel ; Gleasure, Rob et al. / The Impact of Layer 2 Technologies on the Adoption and Security of Blockchain. Proceedings of the 43rd International Conference on Information Systems (ICIS): Digitization for the Next Generation. red. / Tilo Böhmann ; Kai-Lung Hui ; Viswanath Venkatesh. Atlanta, GA : Association for Information Systems. AIS Electronic Library (AISeL), 2022. (Proceedings of the International Conference on Information Systems).

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title = "The Impact of Layer 2 Technologies on the Adoption and Security of Blockchain",

abstract = "Numerous studies have raised concerns over the limited scalability of blockchain technologies and, in particular, Bitcoin. Layer 2 technologies have emerged as an advanced array of complementary innovations designed to solve this problem. Despite the growing optimism around layer 2 technologies, however, there is little evidence to show how they impact blockchain{\textquoteright}s long-term success. This paper argues that the use and expansion of layer 2 technologies have a positive impact on the adoption and security levels of the underlying blockchain systems. Building on the Bitcoin and Lightning Network case, we use a time-series model based on 1,494 daily observations to demonstrate that the growing activity on the Lightning Network precipitates increased use and better security for Bitcoin. These results highlight the importance of layer 2 technologies for blockchain systems and suggest several further research avenues in this nascent domain of inquiry.",

keywords = "Blockchain, Layer 2 technologies, Bitcoin, Lightning Network, Adoption, Security, Blockchain, Layer 2 technologies, Bitcoin, Lightning Network, Adoption, Security",

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year = "2022",

language = "English",

series = "Proceedings of the International Conference on Information Systems",

editor = "Tilo B{\"o}hmann and Kai-Lung Hui and Viswanath Venkatesh",

booktitle = "Proceedings of the 43rd International Conference on Information Systems (ICIS)",

publisher = "Association for Information Systems. AIS Electronic Library (AISeL)",

note = "The 43rd International Conference on Information Systems: ICIS 2022 : Digitization for the Next Generation, ICIS 2022 ; Conference date: 09-12-2022 Through 14-12-2022",

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De Rossi, LM, Avital, M , Gleasure, R & Solcia, R 2022, The Impact of Layer 2 Technologies on the Adoption and Security of Blockchain. i T Böhmann, K-L Hui & V Venkatesh (red), Proceedings of the 43rd International Conference on Information Systems (ICIS): Digitization for the Next Generation., 1501, Association for Information Systems. AIS Electronic Library (AISeL), Atlanta, GA, Proceedings of the International Conference on Information Systems, The 43rd International Conference on Information Systems: ICIS 2022, Copenhagen, Danmark, 09/12/2022. <https://aisel.aisnet.org/icis2022/blockchain/blockchain/6/>

The Impact of Layer 2 Technologies on the Adoption and Security of Blockchain. / De Rossi, Leonardo Maria; Avital, Michel ; Gleasure, Rob et al.
Proceedings of the 43rd International Conference on Information Systems (ICIS): Digitization for the Next Generation. red. / Tilo Böhmann; Kai-Lung Hui; Viswanath Venkatesh. Atlanta, GA: Association for Information Systems. AIS Electronic Library (AISeL), 2022. 1501 (Proceedings of the International Conference on Information Systems).

Publikation: Bidrag til bog/antologi/rapport › Konferencebidrag i proceedings › Forskning › peer review

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AU - Gleasure, Rob

AU - Solcia, Rebecca

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AB - Numerous studies have raised concerns over the limited scalability of blockchain technologies and, in particular, Bitcoin. Layer 2 technologies have emerged as an advanced array of complementary innovations designed to solve this problem. Despite the growing optimism around layer 2 technologies, however, there is little evidence to show how they impact blockchain’s long-term success. This paper argues that the use and expansion of layer 2 technologies have a positive impact on the adoption and security levels of the underlying blockchain systems. Building on the Bitcoin and Lightning Network case, we use a time-series model based on 1,494 daily observations to demonstrate that the growing activity on the Lightning Network precipitates increased use and better security for Bitcoin. These results highlight the importance of layer 2 technologies for blockchain systems and suggest several further research avenues in this nascent domain of inquiry.

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De Rossi LM, Avital M , Gleasure R, Solcia R. The Impact of Layer 2 Technologies on the Adoption and Security of Blockchain. I Böhmann T, Hui KL, Venkatesh V, red., Proceedings of the 43rd International Conference on Information Systems (ICIS): Digitization for the Next Generation. Atlanta, GA: Association for Information Systems. AIS Electronic Library (AISeL). 2022. 1501. (Proceedings of the International Conference on Information Systems).