United States Dollar and Currency
International Business Issue – Can Bitcoin be a stable currency for International business? Definition, Application, and Prospection 1)What is Bitcoin? Bitcoin is an open source peer-to-peer payment network and digital currency introduced in 2009. It is the first decentralized digital currency. It is the digital coin that you can send through the internet. Compare to other alternatives, Bitcoins have a number of advantages. Bitconins are transferred directly from person to person. This means that the fees are much lower you can use them in every country.
Bitcoins re generated all over the Internet by anybody running a free application called a bitcoin miner. Mining requires certain amount of work for each block of coins. This amount Is automatically adjusted by the network such the bitcoins are always created at a predictable and limited rate. And then, bitcoins will be stored in digital wallet which might look familiar with an online banking. When people transfer bitcoins, an electronic signatures added.
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After few minutes, the transaction is verified by miner and permanently stored in the network. Several currency exchanges exist what you can trade your bitcoins for dollars, euros and more. Controversy about Bitcoin – Can Bitcoin substitute real currencies? Bitcoin Is one of the most controversial Issues In recent International business. Can we take bltcoln as a real currency for trading goods? The answer Is yes. Let me take the Gold as an example of a substitute for currencies. The reason why the Gold has the value of money is that people consider it as money. For thousand years, the Gold has been considered as precious as currency. For now, the Bitcoin started to replace the Gold, money and checks. Now, people started to believe the bitcoin has a value as money and they are really trading goods with the bitcoin.
The rate of using bitcoin has been rising rapidly in China, Japan, and the states. Also, the value of bitcoin has been changed a lot. The value of bitcoin was Just 13 USD in last January, however, it is almost 1400 USD now. It Is almost 10000%. The stablllty of bltcoln as a currency Is still controversial. Thus, I would Ilke to say that though bltcoln has a lot of advantages, It has some definite weaknesses to be a substitute for currencies. Firstly, there have been lots of different form of virtual currencies so far. And they all got shrunk. If someone is a good programmer, anybody a limit for issuing amount will disappear.
Moreover, existing currencies are based upon each nation’s control. Currency economies cannot exist outside of taxation systems. As most all of the nations are operated by tax, governments will not permit the free trade of electronic currency which is operated outside of taxation system. Actually, the China Central Bank announced that as the bitcoin is not a genuine currency, it cannot have a legal status. They also said that any financial institution or company cannot put a price of bitcoin and guarantee products that related to bitcoin. South Korea government also stated that the bitcoin is a product which cannot be rotected by Korean laws.
Because the bitcoin has a possibility to be abused in many ways. It is against the Korean real-name financial system and can be used as a money laundering. Obviously, the bitcoin is one of the new flows in international business. However, it has many limits to be a substitute for real currencies. Economy cannot be detached from many other social aspects. Some of European countries have admitted bitcoin as a legal currency. It is possible that bitcoin will be a alternative currency even in Korea. If so, the Bank of Korea is required to examine the bitcoin thoroughly.