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Bitcoin and Its Influence on Future of Currency

Bitcoin is a cryptocurrency that is regarded worldwide and forms one of the digital repayments systems around the world. The approach establishes the decentralized digital currency and works without any single administrator or a central repository; it is generally peer-to-peer, and all the business exchanges involve customers directly without the use of any intermediary. The blockchain, which is a public allotted ledger, is used to record all the transactions carried out through the use of Bitcoins and confirmed by the nodes of the network. Just like any other forex in the world such as dollars, they are exchanged for other currencies, services, and products. The origin of the digital forex is the reward of a mining process, which represents the issue of record keeping through the use of the processing power of a computer. In the recent times, there are several merchants that are continually accepting the use of Bitcoin as a method of payment, and thus, many other investors are taking the use of the currency as an investment. The cryptocurrency wallet is highly indebted for Bitcoin as a medium of exchange. Therefore, they can be classified as a digital asset, and thus, it can be referred to as digital cash, electronic currency, or a virtual currency, which carries the essential qualities of money such as being easy to verify, limited supply, and hard to earn. Notably, the financial regulators, media, law enforcement, and the legislative bodies have been attracted by the criminals who are out to tarnish the use of the form of currency. However, the legality of the use of Bitcoins differs from one country to another, since many of them have no net defined payment system. Nevertheless, there are significant changes in their shift of attitude towards the digital currency. Hence, there is much that the use of Bitcoins can do for the future of money in the world, since it is considered as much more safe and secure payment system that is not affected by factors such as inflation and deflation.

For the small and medium enterprises to rise and compete favorably with the other large merchandises both locally and overseas, they have to adopt the use of digital currency as a mode of payment for the goods and services they stock and offer. Notably, many businesses sell their stocks using the common currency such as dollars; they also readily pay taxes (Briere and Oosterlinck 366). Likewise, the use of Bitcoins as a medium of exchange allows the business owners to carry out the normal operations of the business using the payment system and also remain committed to other regulatory business responsibilities such as paying the taxes on the income received through digital currency. Therefore, there is nothing illegal about the use of Bitcoins to carry out any business deal between the business owner and their customers (Viswanath and Tadwalkar 15). Several legal and ethical questions arise from the use of Bitcoins in many countries in the world. Many traders are in doubt whether the use of the digital currency is used to carry out unknown transactions and whether the payment system is out to compete with the standard government currency. Also, many business people do not know the way to account and accept the use of Bitcoin together with the legal and ethical implications that might arise from its use. Others are not aware how to receive their incomes and consequently pay taxes through digital currency.

Business owners and investors should realize that many governments in the world have authorized the use of the Bitcoins as a legal digital currency, and thus, the issue of its illegality should not be a contentious issue. Therefore, accepting payment through cash, gift cards, scrip, gold, foreign currency, and Bitcoin are similar (Briere and Oosterlinck 368). There are local businesses such as the Great Barrington, Massachusetts that have chosen to accept their locally printed money such as Berkshire Bucks with the aim of supporting their local markets and economy at large. Consequently, Bitcoins use the same concept that in the end, it is used to prosper the economy of the world through the e-commerce platform that is not limited by region, space, or any other physical factors.

Accepting the use of Bitcoins in business is the first step to using the transaction medium to meet the fundamental demand of any enterprise to make a profit. If the business owners are not sure of the number of potential customers that are willing to utilize this kind of payment system, they can just start by bringing into the public eye the fact that they accept Bitcoin. It may be done through the various platforms such as the social and print media (Briere and Oosterlinck 371). Consequently, through awareness creation, potential customers gain the knowledge that they can use the digital payment method to acquire services from a specific shop, thus increasing their confidence in Bitcoin. Notably, the business owner has to use the dedicated applications that can generate the quick response codes, a service that is supported by the many virtual wallets. When customers make payments, credit is usually issued to their accounts.

Fraud is a thorny issue that many businesses that use Bitcoins have to take care of to ensure that they secure their operations from theft and protecting the credibility of using the currency. Fraudsters usually send invoices that are counterfeit to the customers and woe them to facilitate payments to addresses of the Bitcoins that the business owner does not control (Briere and Oosterlinck 372). Therefore, the managers have to be discrete with the information regarding their clients to avoid leaking their details to potential web fraudsters. However, due to the latest developments in technology, there are automated solutions to deal with the issue of burglary in Bitcoin business such as the use of Fraudlabs Pro software that automates the transaction screening and determines the risk level.

Just like any other online payment system in the e-commerce world, some risks are involved; however, with relevant mitigation measures to curb the online fraud, use of electronic money is encouraged to enhance the global nature of most business in the world. Notably, there are exchange rates that are provided by the Bitcoin prices that enable the business people to convert the virtual assets to local currencies that they can use to pay the shareholders, employees, and suppliers. Therefore, the prices are autonomously determined based on either the weighted average basis or the current rate. Also, there are specific sales contracts that should be agreed upon to ensure that there is are misunderstandings between the customer and the business owner; for instance, the party sending the Bitcoin payment should cater for the transaction charge (Viswanath and Tadwalkar 12). Therefore, there is much that use of Bitcoin can do for the future of currency in the world, since it presents a secure many payment system via the internet as one can pay without disclosing crucial financial data and an account is not necessary for the transactions to take place.

Works Cited

Briere, Marie, and Kim Oosterlinck. “Virtual Currency, Tangible Return: Portfolio Diversification with Bitcoin.” Journal of Asset Management, vol. 16, no. 6, 2013, pp. 365-373.

Viswanath, Raghavi, and Vaibhavi Tadwalkar. “Bitcoins – A Viable Currency? Regulatory and Legal Issues.” SSRN Electronic Journal, 2014. https://dx.doi.org/10.2139/ssrn.2531729. Accessed 21 Nov. 2017.

August 09, 2021

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