Arfaduzzaman Kashem

Professor Wernick

ENGL 11000-5BC2

4th November 2021

CryptoCurrency

Cryptography protects digital money, making it almost hard for counterfeiters to use them. On the blockchain, the majority of cryptocurrencies are built on a network of interconnected nodes. Some well-defined aspects of cryptocurrencies, such as the absence of a single centralized authority, make them perfectly resistant to interference. The use of blockchain technology is essential to the workings of cryptocurrencies since it provides a platform for the exchange of data. Many businesses fear that the inclusion of law and finance in the capabilities of blockchains would cause them to go out of business (Jamil et al. 505). Cryptocurrencies are plagued by a variety of issues, including volatility in the exchange rate. 

The utilization of unlawful activities also causes infrastructure flaws to be exacerbated. Online transactions may be made securely using virtual currencies that reflect the internal ledger system. A variety of cryptocurrencies are used to manage digital currency, including bitcoin, which was the most popular and most valuable of the original blockchain cryptocurrencies. Cardano, Litecoin, Peercoin, NameCoin, and Peercoin all fall under the umbrella term “cryptocurrencies.” Currently, the total value of all cryptocurrencies is around $1.5 trillion (Lansky et al. 60). Bitcoin, which was originally designed for military purposes, now accounts for more than 60 percent of the entire value—usage of cryptography in today’s cryptocurrency.

Cryptocurrencies have a number of benefits that make it simpler for people to use them. Cryptocurrencies promise to make money transfers between two people considerably simpler, without the need for a third-party intermediary. Cryptocurrencies make it simpler to conduct audits since transactions are clearly visible. The payment of the parties involved would also be clear, so there would be no mistake. Furthermore, cryptocurrency may be utilized to transfer ownership of assets from one person to another by incurring the risk of making bitcoin payments to the seller. Third-party endorsements might also be explored in addition to the use of cryptocurrencies. With the usage of cryptocurrencies, corporations would have access to a secret transaction that would allow them to track and analyze the use of both cash and credit simultaneously. In order to take advantage of the reduced transaction costs of cryptocurrencies, one should utilize them in all transactions. One should review their bank account statements depending on the transactions they have made. As opposed to a typical financial system, transaction costs for transactions in cryptocurrency would be far lower. In the financial system, conventional ownership stipulates that the whole quantity of cryptocurrency will fall to the candidate if a person dies.

 Cryptocurrencies illustrate that fundamental public and private encryption keys are considerably simpler to identify in a cryptocurrency setting. Thus they should demonstrate this. Bitcoins and other digital currencies have another advantage: great security, thanks to a proven encryption mechanism that prevents the transaction procedures from being altered. Cryptocurrencies also have another benefit: decentralization, which means that two parties will manage the blockchain technology database. Because of this, no third party is involved, and no one is watching what is being done.

One of the dangers of cryptocurrencies is that they are very volatile, which means that unanticipated market emotions might cause significant price swings. In addition, it is unusual for the value of cryptocurrencies to fall by hundreds of dollars at a time. Using bitcoins as an example of a Cryptocurrency for buying services and products includes a certain amount of risk because of the currency’s volatility. It’s estimated that the value of one bitcoin has climbed from zero to roughly $18000 since the first purchase, which means the current post’s worth is around $4000 per bitcoin. In less than half a year, there is a notable drop in the experiences. According to the most recent article from a business standpoint, Bitcoin’s value may have fallen six months ago. Using cryptocurrency has resulted in changes in pricing because of the potential of price hikes.

The lack of cryptocurrency adoption is also a problem; for example, many firms are concerned about the potential for value shifts. Since it is reluctant to accept the payment form, this is why. In the long term, firms may be out of luck if they pay for purchases using cryptocurrency. In the United States, cryptocurrency isn’t commonly considered legal cash. It has a negative impact on the firms’ employees, who dread it and refuse to accept it. Another danger of utilizing cryptocurrency is the possibility of transaction mistakes. When people make mistakes, such as incorrectly entering the quantities of cryptocurrency and other little errors that are common and unusual, it is sad for us to suffer. Preventing mistakes in cryptocurrency is essential to keeping money safe. In addition to the concerns, there is also the potential of theft, which might result in large losses due to cyberattacks while protecting bitcoin transactions. Accounts may be compromised because passwords are so easily lost or stolen. 

Cryptocurrency losses might occur if a computer’s storage devices are corrupted by hardware documents that are corrupted. Cryptocurrency adoption may assist prevent main document theft and minimize hazards if adequate safety measures are considered. An individual stakeholder’s risk is one of the most significant threats to a digital currency, and bitcoins have proved that other cryptocurrencies may exist without being backed by an absolute authority. But although the global government asserts its regulatory authorities in various ways, Bitcoins remain untethered. Owner and shareholder values are the only factors that determine digital currency values without the support of any basic authority. Investors and digital currency values may be left behind, resulting in an increase in difficulties. For the sake of protecting the interests of the customer as well as the financial operations of a company, there should be regulations in place for cryptocurrency.

Cryptocurrencies might benefit from a wide range of rules. Blockchains can’t function without tokens. Thus one of the regulations is to address the issue of taxation. Increased earnings need that the company’s position is very clear. When a person chooses to pay capital gains taxes in the form of cryptocurrency profits, the tax regulations of 2018 clearly state that such transactions are taxable events. Foreign currency flows are also subject to a rule that dictates what one can and can’t do with them after they’ve been picked. A trader who is of a qualifying state should self-announce as an option so that all these transactions may proceed and the exchanges can be regulated. In order to make tax payments simpler, there should be a predominance of trades that discourage dishonesty and unethical conduct. For ICOs with a decentralized universe, there is generally regulation of creating a framework for ICOs where clear guidelines will advise on what is not good and acceptable and should be considered for money issuance (Zetzsche et al. 70). It is important to know who is accountable for raising funds and which equipment is most suited for delivering services. Exchanges that handle initial coin offerings (ICOs) should expect to see new revenue models and a decrease in the amount of illegal activity associated with them.

Project-based reputation staked by exchanges in order to ensure that they are met with proper care and attention. According to rules, when a cryptocurrency exchange is selling ICOs, it should be required to ensure that the ICOs they are selling fulfill a number of requirements before they can be sold. The formation of a working committee composed of blockchain professionals, economists, and other policy wonks. In this section, you’ll only be able to choose the proper choices and learn about the misconceptions. This year’s end-of-year report should present a clear picture of cryptocurrencies rather than keeping stakeholders and developers in the dark. It is very tough to locate and recruit professionals in security in the process of locating the originators of blockchains with track-verified accounts that are unattainable due to a lack of willingness to develop on their own.

When it comes to digital currencies and blockchain technology, the United States government is looking at how they may be used for state-owned projects. In the long term, it will serve as a substitute for cryptocurrencies. Through blockchain phases, the financial institution will be able to look at more efficient processes and explore new income streams. Adaptation and exploration in the industries at hand are facilitated by the development of technologies that are chaotic. Financial institutions’ responses vary in that they use the blockchain system to keep data that are secure and accessible for reference and facilitate transactions more efficiently.

The blockchain’s transactions and clearances may be settled and cleared using digital customized currency created by the financial institution. There is a lot of financing and the development of organizations based on financial institutions so that people may organize chances and have a common savings cost that is lower-settlement costs. Various financial groups are working together to develop settlements’ of the blockchain, which might have a favorable influence on the present international organization of giving out clearances between banks. The growth rate and value of cryptocurrency have clearly increased in the last few years, indicating a rising reputation for the asset class. Cryptocurrency is used to measure how much social media affects everyday life. The success and morality of cryptocurrencies are heavily dependent on social media. If you’re interested in keeping your bitcoins, you can acquire all the information you need via social media outlets like Facebook and Twitter. 

The market price of a cryptocurrency might fluctuate as a result of cryptocurrencies.

Cryptocurrency adoption throughout the globe improves the function of media networks. In the acceptance of international cryptocurrencies, social media influences will play a big role since it impacts and hence results in other social media networks (Li et al. 98). Peer-to-peer networks make it more difficult to obtain data from consumers in order to maintain the integrity of the cryptocurrency and the blockchain. Cryptocurrency marketing techniques might be tough to implement if you don’t have access to timely and extensive data. Consumers may use cryptocurrencies to acquire products and services, which they can then store for future use. These disruptions have resulted in marketers using digital currency to gather momentum. Cryptocurrency’s digital marketing risks necessitate marketers to go straight to the source of customers’ information in order to get their hands on it.

Paying consumers for access to critical data may be costly and has the potential to negatively impact the markets and revenues. Earn.com and steem.com are two of the most recent crypto-focused social media channels that enable advertisers to interact with their audience via the usage of these platforms. It is unknown what role digital currency will play in digital marketing and social media in the future. Therefore the effect of digital currency on media and social media has shifted on the basis of its growth and value. As a result, a new crop of crypto-friendly social connections is being forged. Based on the acceptance of cryptocurrencies, there is a need for promotional success that twists its adoption. For scenarios, digital marketers and bitcoin adoption in the future might be of use to every customer, despite the fact that they may be tempted to sell out more of their research to consumers for cash.

Cryptocurrencies are digital coins that do not need the government to be a link in the electronic payment system. Because of the quick and erratic development of cryptocurrencies, policymakers have begun to pay attention to them. The value of bitcoin and other cryptocurrencies has risen and fallen in recent months. Specifically, the use of cryptocurrencies as a type of alternative currency is important. The history of money has either had a derived value or a basic value determined by a government decision (Fernández‐Villaverde, et al. 520). As a result of the use of electronic money, there has been an increase in both trusted linkage and private ledgers. 

Users distinguish between cryptocurrencies in order to utilize agreements and cryptographic methods to achieve lawful value transfer. In order to ensure that the public ledger is updated in accordance with the movement of assets between accounts, cryptocurrencies utilize addresses to identify passcodes. For the safety of public ledgers against manipulation, computer transfers as usage of blockchain technology are taken into consideration. A trustworthy connection is not required for this to work; therefore the user may merely send and receive coins. Three economic functions are based on the use of money. It serves as a medium of commerce, a unit of account, and a repository for value. 

The future value of cryptocurrencies will be heavily dependent on the ability of cryptocurrencies to provide tasks that are similar to those provided by conventional payment and money systems. As a result of the adoption of technology, a few short arguments have been made on the merits of cryptocurrencies. The development and production of new cryptocurrencies often come with a slew of policy-related dangers. Risks such as these might encourage criminal activity and raise questions about the appropriate rules in place to prevent these consequences of crimes. Consumers who aren’t familiar with cryptocurrencies tend to have a skewed view of how they generate value. Furthermore, the ledgers of cryptocurrencies seem to be more resistant to manipulation.

Individual accounts have been compromised when solving cryptocurrency because of the frauds involved. Critics of cryptocurrency have expressed worries about the current state of legislation and roles, which do not safeguard consumer transactions. At the same time, proponents of cryptocurrencies issue warnings that are in direct opposition to the rules on which they debate. As a result, the Federal Reserve and other institutions involved in financial spread implementation and policy may be impacted by the rise of cryptocurrency as a widely used medium of exchange (Nabilou et al. 272). The development of digital currencies is based on the belief that financial organizations should build their own currency.

Cryptocurrencies, it seems, have a unique manner of distributing information over a computer network. As a result of the use of cryptocurrencies, money may be transferred between parties without the requirement for an intermediary financial institution. There must be a working committee of blockchain professionals to govern cryptocurrencies for the present and future. A clearer up-tax scenario is needed to ensure that cryptocurrencies are audited to be consistently utilized each year. If a cryptocurrency’s strategy ensures a substantial unit scarcity, the rate at which it may be exchanged for another currency will fluctuate greatly.

Works Cited

Fernández‐Villaverde, Jesús. “Cryptocurrencies: A crash course in digital monetary economics.” Australian Economic Review, vol.51., no.4, 2018, pp: 514-526. https://onlinelibrary.wiley.com/doi/full/10.1111/1467-8462.12306

Jamil, Faisal, et al. “A novel medical blockchain model for drug supply chain integrity management in a smart hospital.” Electronics, vol.8, no.5, 2019, p. 505. https://www.mdpi.com/2079-9292/8/5/505

Lansky, Jan. “Cryptocurrency Survival Analysis.” The Journal of Alternative Investments, vol.22, no.3, 2019, pp:55-64. https://jai.pm-research.com/content/22/3/55.short

Li, Tianyu Ray, et al. “Sentiment-based prediction of alternative cryptocurrency price fluctuations using gradient boosting tree model.” Frontiers in Physics, vol.7, 2019, p. 98. https://internal-journal.frontiersin.org/articles/10.3389/fphy.2019.00098/full

Nabilou, Hossein. “How to regulate bitcoin? Decentralized regulation for a decentralized cryptocurrency.” International Journal of Law and Information Technology, vol.27, no.3, 2019, pp: 266-291. https://academic.oup.com/ijlit/article-abstract/27/3/266/5566421

Zetzsche, Dirk A., et al. “The ICO Gold Rush: It’s a scam, it’s a bubble, it’s a super challenge for regulators.” University of Luxembourg Law Working Paper, vol.11, 2017, pp:17-83. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3072298