The influence of bitcoin ecosystem on digital economy

Mariana Makarova

doi:10.31520/2616-7107/2018.2.3-4

Mariana Makarova International Research and Training Center for Information Technologies and Systems of the National Academy of Sciences of Ukraine and Ministry of Education and Science of Ukraine http://orcid.org/0000-0002-9225-933X

DOI: https://doi.org/10.31520/2616-7107/2018.2.3-4

Abstract

Introduction. Bitcoin is a digital, decentralized, partially anonymous currency, not supported by any government or legal entity and not provided with gold or other goods. It relies on a peer-to-peer network and cryptography to maintain its integrity. The proponents claim that Bitcoin has many properties that could make it an ideal currency for consumers and merchants in a modern digital economy.

Aim and tasks. The purpose of article was to determine and analyze impact of Bitcoin ecosystem on global digital economy. The research objectives were as follows: to specify the concept of Bitcoin ecosystem; to study the trends and prospects of cryptocurrencies development; to determine the role of Bitcoin as an alternative mean of preserving capital for investors – «gold bugs»; to compare the influence of gold and Bitcoin on development of a world financial system; to study the importance of Bitcoin and gold as financial assets of digital economy and the role of Bitcoin as a financial instrument inherent in this economy.

Research results. The concept of Bitcoin ecosystem, its main components, factors and risks of development in historical and logical aspects are considered. The tendencies and prospects of cryptocurrencies development, particullary Bitcoin, their influence on traditional E-commerce, conduction of micro-payments, calculations in a field of virtual games are investigated. The role of Bitcoin as an alternative mean of capital preservation for a certain type of investors is determined. The comparative analysis of an influence of gold and Bitcoin on development of world financial system in historical aspect has been carried out. The conclusions are made about role of cryptocurrency (bitcoin) and gold as financial assets of digital economy. The role of Bitcoin as a financial tool corresponding to service requirements of actors of digital economy is determined.

Conclusion. In last few years in many countries the large-scale Bitcoin-ecosystem and economy has developed with tens of millions of Bitcoins which daily change owners in electronic transactions. These funds still have a small amount relative to the rest of world's trading assets and economy.

Today, while the digital currencies work in the semi-legal field in most countries, they may be a danger to national securities laws, be an instrument for tax evasion, illegal banking, money laundering, illicit drug trafficking, etc. This ability should be considered as one of the most unsafe risks of the functioning for Bitcoin ecosystem.

But this is just the beginning of transformations for globalized system, since both society, economy and finance will become fully digital. The problem now is how to find right application for cryptocurrency, so that it becomes a paradigm of financial trust for humanity, as was previously with gold.

Keywords:

cryptocurrencies, fiat currencies, gold, bitcoin (BTC), blockchain, digital economy

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