After the global economic crisis of 2008, various financial institutions and investors lost trust in the conventional banking systems. Through this, Blockchain technology was invented to create Cryptocurrency as a means of exchange designed around the digital use of encrypted figures. The world’s largest crypto, Bitcoin, was invented in 2008, and it uses fair rates to make transactions easier for people. This literature review synthesizes prior research works on Cryptocurrency and draws insights into the opportunities and challenges. The review is useful for scholars and researchers seeking a more balanced understanding of cryptocurrency activities. The paper analyses the sources used in the research work and draws connections among them, noting the changes in authors’ thinking over time.
The article “Effects of the political risk on bitcoin return and volatility: Evidence from the 2016 US presidential election,” by Ajmi, H., & Arfaoui, N. (2020), analyses the effects of Cryptocurrency on politics using SWOT analysis. Cryptocurrency in politics affects transparency and facilitates foreign funding to political parties; it is seen as an external force affecting the credibility of an election. A good example is the effects of Cryptocurrency on the 2016 USA election (Ajmi & Arfaoui, 2020). Cryptocurrency has affected asset declaration by government officials in various countries, thereby threatening the fight against corruption. Ajmi, H., & Arfaoui, N. (2020) appreciates that blockchain technology is a trend whose time has come. Furthermore, that digital currency is the new model for the global economy and influences major political decisions in countries during the campaign.
The book “Blockchain as a solution to the problem of illegal timber trade between Russia and China: SWOT analysis. International Forestry Review,” by Vilkov, A., & Tian, G. (2019), analyses the future growth of Bitcoin and other cryptocurrencies using the SWOT analysis technique. Cryptocurrency revolutionizes the digital currency market with free flow and zero transaction fees (Vilkov & Tian, 2019). The increased advancement in technology has contributed to the increased use of these digital currencies. Even though the article provides various pros of using crypto in trading activities, it states that digital currency cannot fully replace the fiat system. It appreciates that Cryptocurrency has emerged as a technological trend and that investors widely accept it. It is a good source for this research project since it explains Cryptocurrency as a safer and easier to use method of transaction.
The book “Cryptocurrency adoption: Current stage, opportunities, and open challenges. International Journal of Advanced Computer Research,” by Al-Amri, R., Zakaria, N. H., Habbal, A., & Hassan, S. (2019) is another important source for this research work. This study uses SWOT analysis to approximate the percentage increase in the use of digital currencies and blockchain technology. It is evident that Bitcoin is taking over and is slowly becoming the world’s leading form of exchange (Al-Amri et al., 2019). This study also points out how the digital currency has become self-regulated money free from government control. Some opportunities and strengths will enable the growth of Cryptocurrency in the global market, including the security of user data and encryption of transactions. This source also appreciates Cryptocurrency as a technological trend and that its adoption is scalable throughout the research period.
The article “An index of cryptocurrency environmental attention (ICEA). China Finance Review International,” by Wang, Y., Lucey, B., Vigne, S. A., & Yarovaya, L. (2022) is a study of the effects of Cryptocurrency in the China economy. The economic impacts of crypto activities are great, and the use of Cryptocurrency has shifted the economic model. Blockchain technology has penetrated the economic setups of the world, and it has helped in unlocking the various global markets (Wang et al., 2022). Cryptocurrency has changed the money handling roles of China’s Central bank to impact the country’s economic structure. This study shows how Cryptocurrency has changed the money handling roles of China’s Central bank to move the country’s economic structure.
The book “Cryptocurrencies: The future of finance? In Contemporary Issues in International Political Economy,” by Wilson, C. (2019). Wilson uses SWOT analysis to elaborate on the possible future of the traditional monetary system with the increased use of Cryptocurrency as a modern form of exchange. In the last few years, various organizations have adopted Cryptocurrency (Wilson, 2019). However, the idea faces a dilemma as the International Monetary Fund (IMF) tries to scare away its practices. The IMF is trying to manage the activities of Cryptocurrency, which would destabilize the international monetary system. This article is one important source that illustrates the relationship between the two currencies.
In conclusion, the above-discussed sources are relevant and focused on exploring Cryptocurrency as a major technological trend. The key points of agreement among the sources are the increased use of Cryptocurrency, its anonymous nature, and the numerous future opportunities to see the technological trend grow. However, the sources disagree on critical issues, including the destabilization of the traditional monetary systems. All the sources focused on cryptocurrencies, and they proved powerful and influential in this study.
The article by Ajmi, H., & Arfaoui, N. (2020) appear to be the most powerful or influential. This article expresses cryptocurrency as a possible solution to the traditional monetary system. The study by Vilkov, A., & Tian, G. (2019) seems more authoritative than the rest of the sources due to its use of graphical representations and charts to prove the trends in cryptocurrency use. None of the sources however, appears to be outliers, all the research works discussed above provide insights into the challenges of adopting cryptocurrencies in today’s financial systems. The sources show how over the years thinking has changed about cryptocurrency from being a risky investment to more efficient currency. The belief that crypto trade was meant to fail has been dropped.
References
Ajmi, H., & Arfaoui, N. (2020). Effects of the political risk on bitcoin return and volatility: Evidence from the 2016 US presidential election. Journal of Financial Economic Policy, 13(1), 94-115.
Al-Amri, R., Zakaria, N. H., Habbal, A., & Hassan, S. (2019). Cryptocurrency adoption: Current stage, opportunities, and open challenges. International Journal of Advanced Computer Research, 9(44), 293-307.
Vilkov, A., & Tian, G. (2019). Blockchain as a solution to the problem of illegal timber trade between Russia and China: SWOT analysis. International Forestry Review, 21(3), 385-400.
Wang, Y., Lucey, B., Vigne, S. A., & Yarovaya, L. (2022). An index of cryptocurrency environmental attention (ICEA). China Finance Review International, 34-51.
Wilson, C. (2019). Cryptocurrencies: The future of finance? In Contemporary Issues in International Political Economy (pp. 359-394). Palgrave Macmillan, Singapore.