Bitcoin As A Real Money : Statistical Approach

Added on - 21 Jul 2020

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BITCOIN AS A REAL MONEY: ASTATISTICAL APPROACH
ACKNOWLEDGEMENTI am grateful to all people who gave me huge support and suggestions in respect to completion ofresearch study which is based on factors affecting Bitcoin price. I am thankful to my mentor whoteach me lots of ways by following which disseration can be prepared in better way. Withoutsupport of mentor it was not possible for me to carry out this research study to final stage.Finally, I am greateful to all those that support me in completion of my work.
ABSTRACTCurrent research study is based on Bitcoin which is one of well known crypto currency and isused at wide level. Present research is focusing on identifying various variables that have impacton Bitcoin in terms of price. It is identified on analysis of results that price of Bitcoin is affectedby value of USD. Number of vendors, people doing trasactions and inflation also have impacton Bitcoin. Thus, after considering number of factors investment must be made in Bitcoin. It isalso identified that in upcoming time period demand of Bitcoin will increase and along with this,number of mining firms will enhanced. Thus, it can be said that more and more use of Bitcoinwill takes place for making transactions.
TABLE OF CONTENTSACKNOWLEDGEMENT...............................................................................................................2ABSTRACT....................................................................................................................................3CHAPTER1:INTRODUCTION......................................................................................................11.1 Background of study..............................................................................................................11.2 Problem statement.................................................................................................................21.3 Research questions.................................................................................................................21.4 Research aims and objectives................................................................................................31.5 Rationale of study..................................................................................................................31.6 Significence of research study...............................................................................................41.7 Strcuture of report..................................................................................................................5CHAPTER 2: LITERATURE REVIEW.........................................................................................72.1Theoritical framework............................................................................................................72.2.2 List of cyptocurrencies introduced...................................................................................102.2.3 To identify trends in number of transaction of Bitcoin which will reflect number ofmining firms increase or decrease across the globe...................................................................132.2.4 Relationship between price of bitcoin and vendors..........................................................172.2.5 Inflation and bitcoin price.................................................................................................18CHAPTER 3:RESEARCH METHODOLOGY............................................................................263.1 Research introduction..........................................................................................................263.2 Research design...................................................................................................................263.3 Research approach...............................................................................................................273.4 Research philosophy............................................................................................................273.5 Data collection.....................................................................................................................283.6 Data analysis........................................................................................................................28
3.7 Research limitation..............................................................................................................293.8 Ethical considerations..........................................................................................................30CHAPTER 4: DATA ANALYSIS SECTION..............................................................................31To identify relationship between Bitcoin and USD...................................................................31Identifying number of cryptocurrencies introducted.................................................................37To identify number of transaction of Bitcoin which will reflect number of mining firms........38To identify relationship between inflation and price of Bitcoin................................................40CHAPTER 5: DISCUSSION........................................................................................................43CHAPTER 6: CONCLUSION......................................................................................................47REFERENCES..............................................................................................................................50
CHAPTER1:INTRODUCTION1.1 Background of studyTechnology is evolving at rapid pace across the globe. In past few years lots of work is done on development of technology.Bitcoin is one of the electrtonic currency that is used at wide scale across the globe. Before going in to deep research on Bitcon it isnecessary to develop broad understanding about same. Under this electronic mode of payment online currency is issued that remainin our account. Online payments are made by the business firm and currency is not related to specific government or central bank.Under electronic mode of payment that is done through Bitcoin there are some entities like miners (Simser, 2015). These are thoseentitiesd that enter in to network and try to develop block of bitcoin . In this regard they needs do tough job. They need to develophash below threshold limit that is commonly determined for all miners that are operating in the network of bitcoin. When hashvalue is less then threshold value one can successfully build a block and add same to the block chain. Block basically refers to thevector which contains list of the current transactions that are done by the people through Bitcoin (What is Crypto currencyeverything you need to know, 2017). Miners verify the transactions that are covered in block and in return receive bitcoin’s andtransaction fee which is their income. This is the entire process that is going on while transaction happened through bitcoin. Like bankaccount each holder of bitcoin have some unique number that is encrypted and linked to specific algorithm ( Reynolds and Angela,Irwin., 2017). Algorithms are basically set of instructions that execute specific thing on execution of command. When anyone enterkey in respect to account through algorithm verification is done and it is ensured that data will remain safe and no one can stealsame easily. Thus, it can be said that payment through bitcoin is safe. In the current report , different aspects of bitcoin are covered.In the report detail analysis of importance and relevance of bitcoin as payment method is done. Apart from this, application ofbitcoin technology is analyzed in terms of its use that is done by the people and number of countries that are accepting bitcoin formaking and receiving payment. Apart from this, in the report it will be identified whether regulation related to bitcoin is developed. Itcan be said that scope of the present research study is very wide in nature and in future lots of new things can be observed in respectto bitocoin (Ram, Maroun and Garnett, 2016). Inflation is the factor that to great extent affects the nation and economic growth as1|P a g e
well as currency exchange rate. Thus, in the research study an attempt will be made to identify the impact that inflation rate have onthe bitcoin. USD also affects the currency value and in the present research study an attempt will be made to identify the relationshipbetween bitcoin value and currency. It can be said that there is significent importance of bitcoin for the business firms. There arelots of things that can be covered in research about bitcoin. With passage of time use of Bitcoin is increasing across the nations. Nowmore and more vendors are accepting payments in the mentioned currency. Due to this reason demand for same increased in themarket (Coins,2017). It can be said that time will come when more and more payments will be made and accepted in Bitcoin in themarket. With passage of time period it is very important that number of dealers that execute trade related to Bitcoin must be increase.This is because more will be dealers less will be control of same on the network which is very important in the current time period.This will prove good for the Bitcoin across the globe.1.2 Problem statementBitcoin is one of the most popular crypto currency in the world as its use is increasing at fast rate. Most of people does nothave strong knowledge of Bitcoin and due to this reason they think that it would not be better to make investment in mentioned cryptocurrency and they avoid making payment or accepting payment in Bitcoin. There are number of things about Bitcoin that people doesnot know and due to this reason they avoid making use of Bitcoin. This is the major problem that is associated with the Bitcoin and inresponse to this in the current research study different aspects of crypto currency are analyzed in the report. In this regard, relationshipbetween price of Bitcoin and USD is meaured and in this regard data is gathered and same is analyzed by using statistical tools. Rateat which transactions in Bitocoin increased are also analyzed and conclusion is prepared. Interlationship between price of Bitcoin andinflation is also explored. In this way, different aspects of Bitcoin are measured and problem is addressed.1.3 Research questionsWhat is the relationship between Bitcoin and USD?What is the rate at which ceypto currency are issued in the market?What are the trends in the market in respect to Bitcoin?2|P a g e
What is the relationship between price of Bitcoin and number of vendors?What is the relationship between inflation and price of Bitcoin?1.4 Research aims and objectivesAim: To developing broad understanding of Bitcoin and exploring trends related to crypto currency.Objectives:To identify relationship between Bitcoin and USD.To identify number of crypto currency introduced.To identify trends in number of transaction of Bitcoin which will reflect number of mining firms increase or decrease acrossthe globe.To identify relationship between price of Bitcoin and number of vendors.To identify relationship between inflation and price of Bitcoin.1.5 Rationale of studyIt is important to identify the reasons due to which research study must be carried out in the specific domain. As this reflect theimportance of the present research study. It was important to perform the current research study because bitcon is in market for morethen 5 years but today also it is not use as a popular medium for making a payment. Transaction cost is low and instant paymenthappened then also bitcoin does not achieve a huge success (S.M. Irwin. and Milad, 2016). Thus, it is very important identify andevaluate bitcoin on number of factors. This will reflect the reasons due to which bitcoin achieve success of failure in the market. Thereare lots of positive sides of the bitcoin as a a currency. Like it is a single currency that is accepted across the nations. Thus, one doesnot need to care or concern about exchange rates in the market. Then also it failed to achieve expected success in the market. Thus, itwas importnant to conduct the present research study because by doing so different aspects that are related to bitcoin can be coveredeasily add deep analysis of same can be done in systmeatic manner. Thus, it can be said that there is significent importance of thepresent research study for varied entities. In the current time period while doing trade with any nation companies have to consider3|P a g e
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