Searching for the roots of cryptocurrency throughout history: An analysis of bitcoin

Abstract

Barter tries to create a fair exchange of goods and services which is applied even today. Money before coin is typically a coin or object which is accepted by the community. Commodities such as cacao seed, salt, and tobacco were used as a medium of exchange. Coins are standard in weight and value which stems from Lydia and brought a rapid civilization to the World. In gold standard and silver standard the value of money was pegged to the value of the metal. Although European Monetary Union is a recent and well-known attempt for countries to accept a single currency, there were earlier attempts such as Latin Monetary Union. There are criticisms on EMU however, leading to ongoing problems such as Brexit. The end of Soviet Union and Yugoslavia are also interesting to analyze monetary consequences. This is an attempt to create a world currency which creates advantages in trade. Under bimetallic standard, money was pegged to the price of gold and silver. Paper money which is inconvertible created inflationary problems. Bretton Woods is an attempt to peg the currency into US Dollar. Currency wars still exist today, which also benefits some countries in trade. Dollarization is the use of US Dollar outside of USA. De-dollarization attempts to trade in currencies other than US Dollar. Banks are important in the use of modern money; however, the issues in money transfer created some alternatives. Digital wallets are less costly and faster when it comes to money transfer. Cryptocurrencies are also available with the help of Blockchain technology. Bitcoin as the most frequently used cryptocurrency is analyzed in this chapter to test its dynamics. © Peter Lang AG 2020.