Impact of Bitcoin as a World Currency

General Summary of the Article
The scientific article focuses on the electronic currency named Bitcoin, as well as technological and economic aspects of this method of payment and transactions processing. The paper also explores advantages and drawbacks of this currency in comparison with fiat paper currencies and gold https://top-dissertations.com/
Global currencies compete for the sake of becoming the top currency. EURO, USD, and Yuan are not examples of strong currencies that can cope with any challenges and pressure on the world market. The US dollar remains the most reliable currency until a powerful competitor appears. The financial market faces challenges and a new currency can emerge. Bitcoin appeared in late 2013 and at the beginning of 2014. In the past, namely in the 1920s-1930s, people converted currencies into gold or silver. However, the whole system collapsed because of historical conditions and the global market pressure. This system could not cope with the economic growth and advancements. Since then, every state has obtained its paper currency. At the same time, national currencies rely on the government and the central bank and they could not increase the production of banknotes very fast. Therefore, electronic currency Bitcoin has no competitors with respect to this financial aspect. This way, the electronic currency can fight and overcome challenges faced by both fiat currencies and the gold system. Supply and increase in the amount of banknotes do not require an intervention from the government. Moreover, the monetary policy does not influence Bitcoin growth rate.
Hence, Bitcoin is a successful, efficient, and promising currency that has no competitors among fiat paper currencies and gold. Though Bitcoin has certain limitations, this virtual method of payment is a kind of cutting-edge technology that makes financial transactions easier, quicker, and more convenient.
Importance of the Research
This research is important because the virtual currency is a leading method of payment in the modern world where cutting-edge technologies become topical. The research investigates four variables relating to Bitcoin, which shows abilities and the perspective of Bitcoin as a world currency.
Helpfulness of Research Questions
The research questions are helpful because they identify main problems and facilitate readers’ understanding of major challenges and advantages of the virtual currency, Bitcoin.
Research Questions
There are four research questions that focus on the variables of the scientific study. Four variables help to observe the influence of Bitcoin on such world currency as USD. They include the regulation of Bitcoin or the lack thereof, the technological aspect (security and privacy), the economic aspect, and discussion of Bitcoin as a virtual currency. In terms of the regulation aspect, there is no consistency and there is the lack of legal procedures that could be applied to Bitcoin. Bitcoin possesses many unique and specific characteristics that can be applicable to a broad range of industries. The ability to send money in a click in one second is a paramount advantage of the virtual currency.
Answers to the Research Questions
Central banks and governments view Bitcoin as an electronic currency with many drawbacks. There are no regulations and rules concerning legal principles of the financial aspect of Bitcoin. A layperson cannot understand the technology of Bitcoin easily. Thus, users do not feel comfortable using this virtual currency. Hence, the article explains that Bitcoin uses cryptology to check transactions and control the payment process. However, these schemes are not new; many security applications also implement this method. Bitcoin uses two technological techniques, including digital signature and cryptographic hash function. Moreover, Bitcoin is a modern application offering Wallet Service, Financial Service, Payment Processing, and Mining. Top online stores and websites such as Ali Express, Yahoo, Bloomberg, and others have started accepting and processing payments in the electronic currency. Bitcoin strives to introduce the payment system without any intermediates that take huge fees for transactions.
The unit of account, the store of value, and means of payment are three functions of money. Bitcoin copes with these functions perfectly. As a private means of payment, Bitcoin implements a separate account unit and the quantity remains fixed. Bitcoin does not stand for someone`s liability and the government cannot change the quantity because of its preferences. The article also notes that cryptographic mechanisms define the virtual currency as crypto-currency. Regulators do not weigh much as compared to the virtual currency. Currently, cryptographic methods compete with fiat currencies, which do not win this battle. Bitcoin is one of the world currencies that makes financial institutions innovate and introduce drastic changes in the financial sphere.
Finally, the regulation demonstrates a positive impact on Bitcoin. The crypto-currency gives certain advantages to Bitcoin. The Bitcoin Economy continues expending and gaining attention of the massive audience. Understanding Bitcoin as a currency shows its potential to become a leading payment method that would be available and acceptable everywhere. Needless to say, Bitcoin also influences USD on the world market