CRYPTOCURRENCY MONETARY SYSTEM OF THE FUTURE

Kuvaytsev Aleksandr Vyacheslavovich1, Mukminov Ramil Raisovich2
1Dimitrovgrad Engineering and Technological Institute of the National Research Nuclear University MEPHI, student
2Dimitrovgrad Engineering and Technological Institute of the National Research Nuclear University MEPHI, senior lecturer faculty of foreign languages

Abstract
In this article the analysis of the cryptocurrency as one of the contenders for the role of a single world currency. Currently none of the world currencies are not able to become a single world currency, and without this it is impossible the rapid development of the economy worldwide.

Category: 08.00.00 Economics

Article reference:
Kuvaytsev A.V., Mukminov R.R. Cryptocurrency monetary system of the future // Modern scientific researches and innovations. 2017. № 7 [Electronic journal]. URL: https://web.snauka.ru/en/issues/2017/07/84007

View this article in Russian

Being on the threshold of a new era, many experts suggested that in the future mankind in order to realize intensive economic growth, will be necessary for the single currency. However, this currency is not clear today. There are different a bold theory about what this role will perform one of the currently existing national currencies, or else humanity “agree” on the creation of new, not previously existing currency with the special regulations of the issue.

However, while some experts are trying to understand the theory and put forward a new vision for the future single world currency, describing in detail all the details, others have moved from theory to practice by refining the theory of crypto-currencies and the writing of a working prototype. The result was a peer-to-peer payment system, and the aim of the developers was to create a system completely irreversible transactions when a digital payment between two parties can be done without any third party guarantor. In addition, none of the parties, including any external administrator, whose role is usually to banks, tax, judicial and other governmental bodies are unable to cancel, block, challenge or force to commit the transaction. In order to ensure the functioning and protection systems have been used cryptographic methods described in the earlier concepts.

As a result, all information about transactions is not encrypted and is always available in the clear. In addition, the system lacks a mandatory Commission for the conduct of operations. Today the payment systems of such type as of currency circulating in them, quite a lot, but the biggest of them (in terms of market capitalisation and unit value) is called Bitcoin. Bitcoins are used to exchange for goods or services from sellers who agree to accept them.

Dynamics of Bitcoin for more than 6 years of surprises, as the currency has undergone a tenfold change its own value, but the high level of volatility is reinforced by not only a single race at the start, but the change during the period, when for several weeks the cost per unit could rise twice and will return in the reverse position.

Such volatility, obviously, the operation of the system based on methods of payment with cryptocurrency makes it impossible. Therefore, the results of the high volatility at the start, Bitcoin has become in the long term the object of speculation. Such conditions are extremely unfavorable for the development of network marketing. [1] nevertheless, Bitcoin has the ability to occupy the niche stable, until the instability of the national currency does not allow to rapidly develop the infrastructure of e-Commerce market, which requires a stable means of payment. [2]

However, the situation changes in the legal and social aspect. The social aspect is how public opinion sets the image of cryptocurrency and as the population perceives this cryptocurrency. The leading countries seem to have determined the form in which cryptocurrency will be present in their economy and how it will interact with the national currency, and public opinion is easily formed by leading information agencies of the world, gaining a more positive attitude towards young cryptocurrency. Forbes, the us financial-economic magazine, published by John Maldwyn titled “Bitcoin is our future?”[3] and CNN, one of the world’s TV channels, has released the plot of “Can you live one day using to pay for only cryptocurrency”. In addition to all this, one of the CNN reporters, Jose Pagliery, wrote a book which describes the basic intricacies of the cryptocurrency and positioning Bitcoin as “the future of the monetary system”.[4]

This allows to make a conclusion that begins to produce a clear common opinion on the issue of cryptocurrency: its capabilities, its place, its spread. So formed the Bitcoin community, whose members believe in the success of their cryptocurrencies and willing to take active part in all its projects ranging from the purchase of goods through the Internet using Bitcoin as a means of payment to participate in charity projects.

Bitcoin community this is the feature that has a positive impact on the success of the functioning of the cryptocurrency. And despite the fact that at the moment, the existing information field is very much scattered and cryptocurrencies have their competitors, publicly available information allows to feed the Bitcoin community. The already mentioned special magazines and news websites in the course of its activities, one way or another, analyze and illuminate the issues related to the cryptocurrency. And even despite the fact that they are exposed to the risk of journalistic incompetence, the main alternative magazines and Newspapers have, but they are the perfect complement to the Bitcoin community, which is represented by a wide list of forums and social news sites like reddit.

A feature of the latter is that the news have a right to publish not only the administration of the resource, but also ordinary users. This, though, and entails a growth of fraud, but it allows ordinary users to get closer to the so-called “information guns” currency, which claims to be unified and the world. A set of social and legal environment that in turn shape the economic conditions by which cryptocurrencies in General and Bitcoin in particular, is one of the elements of the global financial markets, going beyond narrow business use.

As of mid-June 2015, more than 85% of daily turnover occurs on European and American exchanges that allow Bitcoin to be exchanged primarily on other cryptocurrencies (like Dogecoin, for example), and then on the American dollar. This surely is a depressing fact for the rest of the world, the reliance on the American market for cryptocurrencies is extremely important. For comparison it should result statistics cryptocurrency trading in other currencies. For example, the trade of bitcoin in euros is only 4 percent in rubles – 1%.[5] of Course, to extend the Bitcoin movement helps the idea of issuing limited financial resources, spreading cryptocurrency in all regions of the world.

Emission, it is important to note, by using users ‘ computers as follows: capacity of a number of computing systems perform certain complex calculations that result in the generation of logical chains, the solution of which is used as a kind of “confirmation” number of committed transactions. For the creation of a specific array network “Bitcoin” rewards working computer, in the process of the so-called mining due to the earlier number of bitcoins, and the award, which is awarded for mining diminishes with the number of previously issued bitcoins in the entire system, i.e., regardless of the success of its activities.

Predicting the future of Bitcoin, it should be noted that its success depends on the development of legislative frameworks of different countries. Despite the fact that as a result of five years of Bitcoin has reached the largest market capitalization, it cannot be compared with the volume of issued national currency any from developed countries. That is why the future of cryptocurrency is impossible without legislative regulation.

Currently, in the Russian Federation, cryptocurrency, there are no law benefits, however, users of the cryptocurrency are not still finding ways to use Bitcoin in everyday life, through the organization of business based on it. The absence of this legislative preferences did not prevent the existing online platform “Bag.ru” to enter payment lots for Bitcoin and enter into development escrow system “Secure transaction”, which, in turn, designed and built based on the system of Bitcoin. [5]

From this it follows that in the case of the integration of cryptocurrencies in the economy of the Russian Federation, which is sure to be the processes of introduction and consolidation of currencies will be undoubtedly accelerated because of Bitcoin transform of the financial instrument and object of speculation in the category of highly liquid financial instruments applicable in business and therefore in everyday life. However, this does not mean that the process of introducing cryptocurrencies into the world economy and a successful cryptocurrency can claim the title of world.

On the other hand, has already formed a new generation of people who born surrounded by the Internet, free calls Skype, available online shopping with low prices, special services etc. This generation cannot exist without the ability to make online payments, and the unification of this system will make used after the unification of currency is worldwide popular. Therefore, gaining popularity as a simple means for payment of goods and services in online payments, Bitcoin is intended to retain the advantage in the fight for the title of a single world currency.


References
  1. Калужский М.Л., Карпов В.В. Сетевые интернет-коммуникации как инструмент маркетинга // Практический маркетинг. – 2013. – № 2. – С. 32-39.
  2. Калужский М.Л. Электронная коммерция: маркетинговые сети и инфраструктура рынка. – М.: Экономика, 2014. – 328 с.
  3. Малдуин Дж. Биткойн – наше будущее.[Электронный ресурс]. Режим доступа: http://www.forbes.com/sites/johnmauldin/2014/12/01/is-bitcoin-the-future/ (дата обращения 01.07.2017).
  4. Pagliery J. Bitcoin: And the Future of Money // Triumph Books LLC. – 2014. – 256 с.
  5. Добавление возможности осуществления транзакций с использованием криптовалюты Биткойн.[Электронный ресурс]. Режим доступа: https://meshok.ru/bb/viewtopic.php?f=33&t=1148 (дата обращения 01.07.2017).


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