Abstract

Purpose – to investigate the possible influence of bitcoins and the Blockchain on exchange rates of selected fiat currencies by using quantitative analysis methods. Research methodology – the importance, risks/opportunities are examined by studying scientific literature regarding cryptocurrencies and decentralization. The influence of bitcoins itself is examined by using regression analysis, ANOVA, descriptive statistics, correlation matrix, and VIF. Findings – impart negative relation between Bitcoin money supply and exchange rates (USD/EUR) and a positive relation between Bitcoin inflation rate and exchange rates (USD/EUR). However, the actual influence is too negligible to make any significant affection for the conventional financial sector yet digitalization and decentralization are imminent. Research limitations – only a few analyses have been conducted in a quantitative manner regarding cryptocurrencies impact. The influence of cryptocurrencies increased from 2011; phenomenon lacks long time data and examples to conduct an analysis model that applies to all assumptions without exceptions. Practical implications – enterprises can embrace decentralization and digital money to keep up with the fast-growing market changes, improve transparency, and reduce costs. Close relation with fintech is indispensable; it promotes economic growth and accelerates the development of advanced operating practices. Originality/Value – the interest in digital money and peer-to-peer payments constantly occupy greater importance of financial market and trading manner. Their influence is widely discussed but lacks quantitative researches based on actual historical data

Highlights

  • Aspects of cryptocurrency and the Blockchain are globally discussed by investors and by general society, policymakers, economists, and even national governments

  • The author believes that virtual currencies can and probably will succeed in time, as innovators build on the lessons from the Bitcoin experience

  • The exchange pricing and instantaneous exchange facilities enable Bitcoin to function as a mean of exchange

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Summary

Introduction

Aspects of cryptocurrency and the Blockchain are globally discussed by investors and by general society, policymakers, economists, and even national governments. Bollen, 2013; Luther & White, 2014) believe that digital money and the Blockchain will alter payments and economics globally, pessimists (e.g. Shiller (Huillet, 2018); Carstens (Reid, 2018) considers Bitcoin to face a spectacular collapse near in the future. This analysis seeks to gather findings of the possible influence of nowadays technology trends for conventional financial manner

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