Tootfinder

Smart Contract Adoption in Derivative Markets under Bounded Risk: An Optimization Approach
Jinho Cha, Long Pham, Thi Le Hoa Vo, Jaeyoung Cho, Jaejin Lee
https://arxiv.org/abs/2510.07006

Smart Contract Adoption in Derivative Markets under Bounded Risk: An Optimization Approach
This study develops and analyzes an optimization model of smart contract adoption under bounded risk, linking structural theory with simulation and real-world validation. We examine how adoption intensity alpha is structurally pinned at a boundary solution, invariant to variance and heterogeneity, while profitability and service outcomes are variance-fragile, eroding under volatility and heavy-tailed demand. A sharp threshold in the fixed cost parameter A3 triggers discontinuous adoption collap…