This dissertation examines the evolution of the blockchain and cryptocurrency landscape since the genesis of Bitcoin in 2009. It investigates the development of public blockchains, proposes a taxonomy for their generations, and identifies key areas to advance Web3 development. The dissertation focuses on two critical problems: on-chain reputation in Web3 and automated market making (AMM) models for perpetual futures in decentralized finance (DeFi). For on-chain reputation ranking, a novel system leveraging adaptive PageRank algorithms is introduced. This system is validated through experimentation with real blockchain data, demonstrating its effectiveness in classifying eligible wallets versus Sybil attacks during airdrops and forecasting user lifetime value. Further, the applicability...[ Read more ]

This dissertation examines the evolution of the blockchain and cryptocurrency landscape since the genesis of Bitcoin in 2009. It investigates the development of public blockchains, proposes a taxonomy for their generations, and identifies key areas to advance Web3 development. The dissertation focuses on two critical problems: on-chain reputation in Web3 and automated market making (AMM) models for perpetual futures in decentralized finance (DeFi). For on-chain reputation ranking, a novel system leveraging adaptive PageRank algorithms is introduced. This system is validated through experimentation with real blockchain data, demonstrating its effectiveness in classifying eligible wallets versus Sybil attacks during airdrops and forecasting user lifetime value. Further, the applicability of on-chain reputation in establishing trust and credibility within Web3 is explored. The dissertation additionally proposes two novel AMM models for power perpetuals and perpetual futures markets in DeFi. These models ensure liquidity provider solvency. Notably, the power perpetuals model offers utility in hedging impermanent loss on Uniswap and similar spot AMM-based exchanges. This work envisions a future with a decentralized, robust on-chain reputation ranking system, which, in composition with DeFi protocols and on-chain payment processes, would foster trust and facilitate smoother operation within Web3. The potential of blockchain is to create an "Internet of Value" characterized by mass adoption in DeFi and on-chain economic activity.

Keyworks: Automated market making (AMM), Blockchain, decentralized exchange, decentralized finance, HodgeRank, PageRank, adaptive PageRank, perpetual futures, power perpetuals, onchain reputation, reputation ranking, virtual liquidity.