Table of Contents 0 Introduction 1 Literature review 2 Development and cryptocurrencies 2 Scopes and objectives

Table of Contents 0 Introduction 1 Literature review 2 Development and cryptocurrencies 2 Scopes and objectives (Advantages and Disadvantages) 5 Methodology 6 Investigation (Analysis), Policy Implications, Recommendations. 8 Conclusion 10 Reference list 11




















Cryptocurrencies are a new concept in the world of finance and banking and have the potential to change the overall functioning of the economy on a global scale. The topic of cryptocurrency is very popular nowadays and there is a lot of talk about it. From himself

the beginning of the emergence of cryptocurrencies in the past decade, and until today, there has been speculation as to whether

cryptocurrencies should be accepted as a valid method of payment or not. Despite the potential of cryptocurrencies and all the benefits they offer, they pose a threat to the traditional old system that is proven and secure. Connected to that, the goal of this

It is reported that secondary research has determined the validity of this primary issue and

arguments. The topic of this report is the origin and development of cryptocurrencies, advantages and disadvantages

(pros and cons), which is supported by theoretical arguments and facts. Related to that

discussion, cryptocurrencies have made up for the shortcomings of modern banking and thus contributed

financial market and further development and progress in general. Given that it is such a way

payments new and at a higher level, has attracted attention and become popular in the whole society.

Therefore, research has shown that cryptocurrencies have become financial competition

institutions, leading to change and progress in both fields. Banking systems have adopted everything

advantages and benefits that cryptocurrencies provide and thus improve their work and reputation.



Literature review


Development and cryptocurrencies


With the improvement of the Web and innovation, there has been a critical advancement in the monetary section. Deepika and Kaur (2017) distinguished that individuals since the beginning of time have depended on various payment frameworks, for example, trades of merchandise that couldn’t not entirely settled by esteem, through trades of gold, to the utilization of government issued currency that is impacted by expansion. With the advancement of the Web and present day advances, individuals have started to bring issues to light and confidence in web-based exchange frameworks and subsequently become quite possibly the most appealing installment strategy. With the drive and the need to foster a computerized instalment framework that happens in the immediate exchange of assets between people, the main decentralized advanced money – Bitcoin – was made. From days of yore, individuals have preffered parts strategies that are persuading and secure. With the revelation of bitcoin, the functioning guideline as indicated by which these digital money works is started, introduced as blockchain. A blockchain is an advanced data set that stores data inside a gathering called blocks. The squares have a restricted filling limit and once filled, they close and associate with the past square which is additionally filled and along these lines makes a chain of squares. This advanced framework plays a pivotal part in the working of cryptographic forms of money since it empowers its decentralization, ie recording and fruitful execution of exchanges without the requirement for the trust of an outsider as a middle person, yet additionally makes exchanges secure. Through this framework, digital currency clients can stay unknown through private codes that only they can decode, while then again, blockchain empowers straightforwardness as perceivability of all data and exchanges between clients through its hubs. This method of straightforwardness additionally accomplishes security since it makes it challenging to change the substance of the square, except if the greater part concurs with it, which forestalls and makes it harder for programmers to take digital money. Blockchain expects to record and save all exchanges in the computerized data set yet forestalls its changes. With this, all data remains put away, noticeable, and recorded in this computerized “record” and it can’t be erased or annihilated (Conway, 2021).

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Illustration of Bitcoin structure.

Source: (Dobrowski and Janikowski, 2018).


Not long after the acknowledgment of Bitcoin, other digital currencies likewise started to create and show up as “altcoins” or elective forms of bitcoin that contrast in reason and achievement, yet share normal standards of construction and attributes (Miciuła and Kazojć, 2019). The authority information from Investopedia (Conway, 2021), shows that today there are more than 10,000 cryptographic forms of money, some of which are acquiring the most fame – Ethereum; Litecoin; Wave, and so on Dissimilar to government issued currency, the worth of digital forms of money isn’t liable to changes and guidelines by elements, yet to the assumptions and requests of society. (Kucheryavenko, Dmytryk and Golovashevych, 2019). As Kuikka (2019) found, from the case of Bitcoin, after its creation, its worth was assessed in pennies, while today, after 12 years, the cost of Bitcoin is assessed at around 50 thousand dollars (CoinMarketCap).

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Scopes and objectives (Advantages and Disadvantages)


As Dabrowski and Janikowski (2018) note, cryptographic forms of money have large amounts of critical advantages and advances in this day and age, yet in addition restrictions and expected weaknesses. The rise of digital currencies, most importantly, decreased exchange costs. Through a shared framework exchange costs are fundamentally decreased with least exchange charges assessed beneath 1%. One of the fundamental benefits is the exceptionally quick affirmation of exchanges contrasted with the financial framework, as well as the accessibility of diverting assets 24 hours per day, while banks are restricted by working hours. One more benefit is the secrecy of the framework, where clients don’t give their touchy information, yet everything deals with codes and accordingly decreases the chance of robbery or loss of individual information, just like the case in conventional frameworks. Likewise, digital currencies are not inclined to expansion since they are not affected by national banks or political powers (Rice, 2019).

However, as far as regrettable viewpoints, cryptographic forms of money have caused extraordinary theory and shock over their curiosity and vulnerability. Putting resources into something not still totally acknowledged in all nations as an authority technique for payment prompts dread among financial backers to enter this market (Dumitrescu, 2017). As indicated by research by Kuikka (2019), the enormous progression of data that causes theory and publicity of individuals on this point prompts changes in the costs of digital currencies, which is the reason they have the trademark that they are exceptionally unpredictable and thusly hazardous for financial backers. An illustration of a high unpredictable conversion standard happened when the cost of Bitcoin tumbled from 19,435 US dollars in mid-December 2017 to 6,858 dollars toward the start of February 2018 (Dabrowski and Janikowski, 2018). One of the inadequacies of the quality of namelessness, which is positively not 100 percent complete, is definitively the stowing away of individual character that advances unlawful activities. Additionally, there is hypothesis about the utilization of a colossal measure of power by these frameworks contrasted with customary financial frameworks through PCs, which adds to ecological harm.




The fate of banking is most certainly in danger due to the ascent of digital forms of money. Digital currencies like Ripple XRP are made to be utilized as a cash for moving enormous measures of cash between individuals with very low charges and the speed of light. For instance, sending an exchange of 100,000$ the expenses will be 0.0004$ and the exchanges will just require 2 to 5 seconds. Banks need to begin executing monetary standards like XRP into their financial framework to keep up and not fall flat. A review shows that on a worldwide scale just 50% of the clients are happy with their banks and the financial framework (Arslanian and Fischer, 2019). This shows us that banks need to begin improving on the off chance that not they lose clients to the crypto biological system.

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Not just that crypto exchanges are quicker and less expensive to do between distributed, but on the other hand it’s a lot more secure with regards to tricks since crypto has a public record with the wallet addresses so everybody can see who sends cash to which address and measure of it. This capacity gives security in light of the fact that nobody knows your business, just you and the beneficiary. This is all conceivable in view of the blockchain innovation carrying out a public record after confirmations for each exchange. This framework clarifies why crypto exchanges are protected, however on the off chance that the shipper sends the crypto to some unacceptable wallet address, the source can doubtlessly not recuperate it (Crosby, Iappan, and Pattanayak, 2016).


Investigation (Analysis), Policy Implications, Recommendations


The positive side with regards to some cryptographic forms of money like XRP, ETH, BTC, ADA is that they were intended to be an option electronic payment framework which is awesome for future scaling (Perkins, 2020). Some time ago when there was just Bitcoin, adjusting an exchange framework for a bank through crypto was truly challenging. It’s wonderful to see that now there are cryptographic forms of money planned and made with the errand to be executed effectively in the monetary framework. For banks to execute crypto exchanges into the financial framework, they could need to change the design of the installment handling framework and this could reshape the definition and ramifications of the money related arrangement (Singh and Kant, 2019). This is something worth being thankful for a portion of these approaches have not been refreshed in 100 years, so it’s the ideal opportunity for a change.

The approach ramifications of digital money developed after some time and hence with legitimate execution, an ever increasing number of organizations will need to take on the crypto mindset and see that it is an extremely valuable and well-performing resource and framework (ECB Crypto-Assets Task Force, 2019). A while ago when digital currencies were simply beginning, there were no approaches and no managing frameworks behind them, however as of now, we can see that immense financial frameworks are getting behind it, like the European Central Bank. National banks have as of now begun chipping away at executing crypto strategies, for instance, VISA and MASTERCARD have begun utilizing crypto as of now. What’s to come is close to where banks will make and issue their own cryptographic forms of money (Юрьевна, 2017).


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One major issue with digital forms of money is the absence of instruction that clients have about crypto. For instance, clients ought to break down and investigate possible speculations, prior to purchasing cryptographic forms of money in view of the proposals. For people in general to comprehend and begin utilizing crypto in regular things a ton of training is required on this subject (Farell, 2015).


There is additionally one more issue with digital forms of money and that is it is absolutely impossible to follow crypto resources that were gained by an organization and put in their stock for long haul holding and afterward sold for a benefit in the future after those resources were procured (Morozova et al., 2020). Government foundations don’t have a method for telling the justification behind a specific organization’s investigation into crypto resources. The method for fixing this is to carry out a record that determines the justification behind getting crypto resources so the government organization will actually want to follow which organizations purchase crypto resources why. This must be executed as quick as conceivable so that crypto can develop on an industry and government level.




The outcomes got in this report demonstrate that with the advancement of innovation, as well as venturing into the cutting edge age, new techniques for computerized installment have been presented for decreasing the issues emerging from the customary framework. In any case, there is space for new advances as well as the ramifications of new approaches to make digital currencies as advantageous and safer to utilize, and subsequently add to more prominent general acknowledgment as a precise installment framework around the world. While digitalization might represent a danger to customary techniques that individuals are acquainted with, mindfulness and information on the advantages it brings ought to be raised. Cryptographic forms of money would not exclusively be a benefit for individuals who be able to utilize them, yet in addition for monetary establishments as an oddity that they can consolidate inside their frameworks to make the most proficient conceivable working of monetary business sectors.







Reference list


Arslanian, H. and Fischer, F. (2019) The Future of Finance: The Impact of FinTech, AI, and Crypto on Financial Services. Available at: (Downloaded: 27 November 2021)


CoinMarketCap. (n.d.) Cryptocurrency Market Capitalizations | CoinMarketCap. [online] Available at: (Accessed: 28 November 2021).

Conway, L. (2021) Blockchain Explained. Investopedia. [online] Available at: (Accessed: 26 November 2021).

Morozova, T. et al. (2020) ‘Crypto asset assessment models in financial reporting content typologies’, ENTREPRENEURSHIP AND SUSTAINABILITY ISSUES, 7(3), pp. 2196-2212. doi:


Corbet, S. et al. (2019) ‘Cryptocurrencies as a financial asset: A systematic analysis’, International Review of Financial Analysis, 62, pp.182-199. doi:

Crosby, M., Nachiappan, N. and Pattanayak, P. (2016) BlockChain Technology: Beyond Bitcoin. 2th edition. AIRApplied Innovation Review. Available at: (Accessed: 28 November 2021).


Conway, L. (2021) The 10 most important cryptocurrencies other than bitcoin? Investopedia. [online] Available at: (Accessed: 27 November 2021).


Dabrowski, M. and Janikowski, L. (2018) Virtual Currencies and Their Potential Impact on Financial Markets and Monetary Policy. Warsaw: Center for Social and Economic Research (CASE).

Dumitrescu, G. C. (2017) ‘Bitcoin -A Brief Analysis of the Advantages and Disadvantages’, Institute for World Economy, 5(2), pp. 63-71. Available at: (Accessed: 27 November 2021).

Extance, A. (2015). The future of cryptocurrencies: Bitcoin and beyond. Nature News526(7571), p.21. [online] Available at: (Accessed 28 November 2021)

Deepika, E. and Kaur, E. R. (2017) ‘Cryptocurrency: Trends, Perspectives and Challenges’, International Journal of Trend in Research and Development, 4(4), pp.4–6. Available at: (Accessed: 27 November 2021).


Kucheryavenko, P. M., Dmytryk, O. O. and Golovashevych O. O. (2019) ‘Cryptocurrencies: Development, features and classification’, Financial and Credit Activity Problems of Theory and Practice, 30(3), pp. 371-374. doi: 10.18371/fcaptp.v3i30.179737

Singh, B. and Kant, S. (2019) ‘Crypto Currencies/ Blockchain and the Banking System. Available at: (Accessed 28 November 2021).


Kuikka, O. (2019). Can cryptocurrency come to fulfill the functions of money? An evaluation of cryptocurrency as a global currency. Bachelor’s Thesis. Metropolia University of Applied Sciences. Available at: (Accessed: 28 November 2021).

Leonard, D. and Treiblmaier, H. (2019). ‘Can cryptocurrencies help to pave the way to a more sustainable economy? Questioning the economic growth paradigm’. Business transformation through Blockchain, pp.183-205. Palgrave Macmillan, Cham. [online] Available at: (Accessed 28 November 2021)

Farell, R. (2015) An Analysis of the Cryptocurrency Industry. Thesis. University of Pennsylvania. Available at: (Accessed: 28 November 2021).


Miciuła, I. and Kazojć, K. (2019) ‘The global development of cryptocurrencies’, Prace Naukowe Uniwersytetu Ekonomicznego we Wrocławiu, 63(2), pp.183–196. doi:10.15611/pn.2019.2.16

Rice, M. (2019) Cryptocurrency: History, Advantages, Disadvantages, and the Future. Senior Honor Theses. Liberty University. Available at: (Accessed: 26 November 2021).


ECB Crypto-Assets Task Force (2019). Crypto-Assets: Implications for financial stability, monetary policy, and payments and market infrastructures. No. 223. Frankfurt: European Central Bank (ECB).


Perkins, D.W. (2020) Cryptocurrency: The Economics of Money and Selected Policy Issues. [online] Congressional Research Service. R45427. Available at: (Accessed: 27 November 2021).


Юрьевна, O.C. (2017) THE PHENOMENA OF CRYPTOCURRENCY AND ITS IMPLICATION ON THE MONETARY SYSTEM. Available at: (Accessed: 27 November 2021).


Yermack, D. (2015). ‘Is Bitcoin a real currency? An economic appraisal’, In Handbook of digital currency, pp. 31-43. Available at: (Accessed: 28 November 2021).




Singh, B. and Kant, S. (2019) ‘Crypto Currencies/ Blockchain and the Banking System ’.

Available at: –


e41bffa458515072d9192fe/Crypto -Currencies-Blockchain-and-the-Banking-System.pdf.

(Accessed 28 November 2021).

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