Report on Digital Currency's Impact on the UK Financial System

This report analyzes the impact of digital currency on the UK financial system, utilizing quantitative data analysis with a focus on frequency distribution. The research explores various facets, including awareness of digital currency, its role in simplifying transactions and influencing investment returns, and its effects on price stability. Findings indicate that while digital currency offers benefits like faster payments and increased transparency, it also presents challenges such as cybersecurity risks and data breaches. The study concludes that digital currency significantly impacts the UK financial system, necessitating careful management and regulatory considerations to mitigate potential risks and leverage its advantages. Desklib provides access to this and other solved assignments for students.

Chapter 4: Analysis and
Findings

Contents
CHAPTER 4 DATA ANALYSIS AND FINDINGS......................................................................1
FINDINGS.......................................................................................................................................7
REFERENCES................................................................................................................................8

CHAPTER 4 DATA ANALYSIS AND FINDINGS
Data analysis is one of the effective process by which researchers modify and make changes in
collected data with the main aim of accomplishing goals, improving study and making better
decision. Accuracy of data is the key of research study and when researcher collect accurate
information then it can improve their image in the market. It can boost their confidence and they
may find easier in conducting research studies in the future with effectiveness. For this research
study, researcher has selected quantitative data analysis tool because this study is quantitative
and researcher has collected information in numerical or statistical form. Under quantitative data
analysis tools, frequency distribution method has been selected .
Questionnaires
Q1. Do have any idea about the term the concept of digital currency?
Yes
NO
Q2. What is the role of digital currency on UK financial system?
Simplifies the records of the transactions
Accessing the investment return
Helps the management to take appropriate decisions
Q3. What is the impact of digital currency on UK financial system?
Fluctuation in the prices
Unstable system
Leads to a decrease in the value
Q4. As per your view point, Does digital currency have positive impacts upon UK financial system?
True
False
Q5. As per your view point, Does digital currency have negative impacts upon UK financial system?
True
False
Q 6. What are the different benefits of digital currency on UK financial system?
Faster payments
Greater transparency
Discrete & Confidential
Q7. What are the different challenges faced by UK financial system due to digital currency?
Cyber security attack,
Account and data breaches
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Counterfeiting
Q8. What are the various types of digital currencies??
Cardano
Bitcoin
Q9. Any suggestion.
FREQUENCY DISTRIBUTION TABLE
Q1. Do have any idea about the term the digital currency? Frequency
Yes 15
NO 5
Q2. What is the role of digital currency on UK financial system? Frequency
Simplifies the records of the transactions 14
Accessing the investment return 4
Helps the management to take appropriate decisions 2
Q3. What is the impact of digital currency on UK financial system? Frequency
Fluctuation in the prices 10
Unstable system 10
Q4. As per your view point, Does digital currency have positive impacts upon UK financial
system?
Frequency
True 13
False 7
Q5. As per your view point, Does digital currency have negative impacts upon UK financial
system?
Frequency
True 11
False 9
Q 6. What are the different benefits of digital currency on UK financial system? Frequency
Faster payments 12
Greater transparency 4
Discrete & Confidential 4
Q7. What are the different challenges faced by UK financial system due to digital currency? Frequency
Cyber security attack, 5
Account and data breaches 10
Counterfeiting 5
Q8. What are the various types of digital currencies?? Frequency
Cardano 10
2

Bitcoin 10
Q9. Any suggestion.
INTERPRETATION
Theme 1: Any idea about the term the digital currency.
Q1. Do have any idea about the term the digital currency? Frequency
Yes 15
NO 5
Interpretation: As per the above graph, it has been interpreted that out of 20 respondents, 15 are
in favour of yes and rest 5 of them are saying no. So, this states that most of the respondents
have idea about the Digital currency. It type of currency which is available only in electronic and
digital form. In addition to this, it is also known as electronic money that is only accessible with
mobile phones or computers as it only exists in electronic form.
Theme 2: The role of digital currency on UK financial system.
Q2. What is the role of digital currency on UK financial system? Frequency
Simplifies the records of the transactions 14
Accessing the investment return 4
Helps the management to take appropriate decisions 2
Interpretation: The digital currency plays various essential role on UK financial system such as
simplifies the records of the transactions, accessing the investment return, helps the management
to take appropriate decisions and many others. So, as per the above graph, it has been interpreted
that out of 20 respondents, 14 are in favour of simplifies the records of the transactions, 4 are
responding towards accessing the investment return, and rest 5 of them are saying helps the
management to take decisions. This states that simplifying the records of transaction is key role
of digital currency upon UK financial system. Also, The firm also invests in the digital medium
of the currency which assists the enterprise in accessing the investment return by including it in
the financial statement. Evaluating, helps the management to take appropriate decisions. These
are implied by the medium of central banks. It simplifies the records of the transactions which
are done through the technology.
Theme 3: The impact of digital currency on UK financial system.
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Q3. What is the impact of digital currency on UK financial system? Frequency
Fluctuation in the prices 10
Unstable system 10
Interpretation: The various impact of digital currency on UK financial system are fluctuations in
prices, unstable system and so on. So, As per the above graph, it has been interpreted that out of
20 respondents, 10 are in favour of fluctuations in prices and rest 10 of them are saying Unstable
system. This states that digital currency has direct impact on and for this it is vital for companies
to maintain a record of every transaction so that it can manage funds properly. digital currency is
not volatile, it changes rapidly. This leads to the fluctuation in the prices and is an issue for the
companies who invest in these types of currencies. It is an unstable system. It leads to a decrease
in the value of other digital currencies, and the companies have suffered losses due to this.
Theme 4: Digital currency have positive impacts upon UK financial system.
Q4. As per your view point, Does digital currency have positive impacts upon UK financial
system?
Frequency
True 13
False 7
Interpretation: As per the above graph, it has been interpreted that out of 20 respondents, 13 are
in favour of true and rest 5 of them are saying false. So, it states that digital currency have
positive impacts upon UK financial system as this provides various benefits such as Faster
payments, Discrete & Confidential and many others.
Theme 5: Digital currency have negative impacts upon UK financial system.
Q5. As per your view point, Does digital currency have negative impacts upon UK financial
system?
Frequency
True 11
False 9
Interpretation: As per the above graph, it has been interpreted that out of 20 respondents, 11 are
in favour of true and rest 9 of them are saying false. So, this states that most of the respondents
knows that Digital currency have negative impacts upon UK financial system as they have to
faces some challenges due to this. Some of them are cyber security attack, account and data
breaches, counterfeiting and many more.
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Theme 6: The different benefits of digital currency on UK financial system.
Q 6. What are the different benefits of digital currency on UK financial system? Frequency
Faster payments 12
Greater transparency 4
Discrete & Confidential 4
Interpretation: There are different benefits of digital currency on UK financial system. Some of
them are faster payments, greater transparency, discrete & confidential and many others.
So, As per the above graph, it has been interpreted that out of 20 respondents, 12 are in favour of
faster payments, 4 are responding towards greater transparency, and rest 4 of them are saying
discrete & confidential. This states that faster payments is one of the key benefits of digital
currencies on UK financial system.
Theme 7: The different challenges faced by UK financial system due to digital currency.
Q7. What are the different challenges faced by UK financial system due to digital currency? Frequency
Cyber security attack, 5
Account and data breaches 10
Counterfeiting 5
Interpretation: There are different challenges faced by UK financial system due to digital
currency. Some of them are cyber security attack, account and data breaches, counterfeiting and
many more. So, as per the above graph, it has been interpreted that out of 20 respondents, 5 are
in favour of cyber security attack, 10 are responding towards Account and data breaches, and rest
5 of them are saying counterfeiting. This states that the account and data breach is one of the
essential challenge which can be faced by UK financial system due to digital currency.
Theme 8: The various types of digital currencies.
Q8. What are the various types of digital currencies? Frequency
Cardano 10
Bitcoin 10
Interpretation: There are various types of digital currencies that are used by UK government.
Some of them are CBDC, BITCOIN, CARDANO and others. So, as per the above graph, it has
been interpreted that out of 20 respondents, 10 are in favour of Cardano, 10 are responding
5

towards Bitcoin. This states that various forms of digital currencies are used by UK government
in equal manner.
Theme 9: Any suggestion.
Q9. Any suggestion.
Interpretation: As per the above, it has been suggested that digital currency plays various essential role on UK
financial system. Additionally, this is the type of currency which is available only in electronic and digital form. In
addition to this, it is also known as electronic money that is only accessible with mobile phones or computers as it
only exists in electronic form. So, it have various benefits and challenges as well. In addition to this, UK financial
system have to apply the anti-money laundering regulations in exchange of digital currency as it help them to
prevent from criminal uses.
FINDINGS
Based upon the above analysis, it have been identified that The digital currency plays
various essential role on UK financial system such as simplifies the records of the transactions,
accessing the investment return, helps the management to take appropriate decisions and many
others. But simplifying the records of transaction is key role of digital currency upon UK
financial system. Digital currency is the type of currency which is available only in electronic
and digital form. In addition to this, it is also known as electronic money that is only accessible
with mobile phones or computers as it only exists in electronic form. In addition to this, it has
been also identified that. Also, The firm also invests in the digital medium of the currency which
assists the enterprise in accessing the investment return by including it in the financial statement.
Evaluating, helps the management to take appropriate decisions. These are implied by the
medium of central banks. It simplifies the records of the transactions which are done through the
technology. Additionally, The various impact of digital currency on UK financial system are
fluctuations in prices, unstable system and so on. digital currency has direct impact on and for
this it is vital for companies to maintain a record of every transaction so that it can manage funds
properly. Digital currency is not volatile, it changes rapidly. This leads to the fluctuation in the
prices and is an issue for the companies who invest in these types of currencies. It is an unstable
system. It leads to a decrease in the value of other digital currencies, and the companies have
suffered losses due to this.
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REFERENCES
Books and Journal
Bindseil, U., 2019. Central bank digital currency: Financial system implications and
control. International Journal of Political Economy, 48(4), pp.303-335.
Bindseil, U., 2020. Tiered CBDC and the financial system. Available at SSRN 3513422.
Kregel, J.A. and Savona, P., 2020. The impact of technological innovations on money and
financial markets (No. 150). Public Policy Brief.
Nabilou, H., 2019. Central bank digital currencies: Preliminary legal observations. Journal of
Banking Regulation.
Nabilou, H., 2020. Testing the waters of the Rubicon: the European Central Bank and central
bank digital currencies. Journal of Banking Regulation, 21(4), pp.299-314.
Pichler, P., Summer, M. and Weber, B., 2019. Does digitalization require central bank digital
currencies for the general public. OeNB Monetary Policy & The Economy Q, 4, pp.40-56.
Viñuela, C., Sapena, J. and Wandosell, G., 2020. The future of money and the central bank
digital currency dilemma. Sustainability, 12(22), p.9697.
Ward, O. and Rochemont, S., 2019. Understanding Central Bank Digital Currencies
(CBDC). Institute and Faculty of Actuaries.
Carney, M., 2019, August. The growing challenges for monetary policy in the current
international monetary and financial system. In Remarks at the Jackson Hole
Symposium (Vol. 23).
Náñez Alonso, S.L., Echarte Fernández, M.Á., Sanz Bas, D. and Kaczmarek, J., 2020. Reasons
fostering or discouraging the implementation of central bank-backed digital currency: A
review. Economies, 8(2), p.41.
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