Research paper Blockchain and Stablecoin

Document Type:Research Paper

Subject Area:Economics

Document 1

In the event of one intending to acquire anything, there is always a standardized manner in which items and services are quoted for trading (Beate 2016). Trade refers to the exchange of goods and services. This exchange has been in existence for a very long period of time since humans cannot produce all that they need or aspired to have. They are therefore forced to perfect in a particular line of products or services then, later on, use the returns to acquire their other desired goods and services. In the past, the acquisition of products was solely controlled by the physical exchange of the goods. Subsequently, there is a decrease in the use of paper money which gives a projection of a possible elimination of the same in the future.

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The sprout of virtual currencies such as Bitcoin and Stablecoin is likely to eliminate the use of paper money owing to their convenience, versatility, and efficiency across the globe (Max and Yermack 2016). In the future, paper money can be replaced by virtual currency. I. Changes in Perception Regarding Virtual Currencies Humans have developed various currencies over the years all in the bid to ensure convenience and safety of traders and transactions. This is because there are various setbacks that come alongside this technological advancement just like most technological advances are known. These have affected the perceptions of some people towards embracing virtual currency. There is the issue of security of personal details and that has significantly contributed to the fear of the digital currency system (Jarrett et al.

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Hackers and other cybercriminals have perfected their trade of stealing details of clients from financial institutions such as the credit card firms. The information or stolen data is often used for malicious acts by certain agencies that buy them from hackers. They can no longer be easily hacked into as was the case in the previous years. One cannot access passwords even by stealing the hardware used for their storage. This gives a lot of assurance to people who previously doubted the electronic system of receiving and sending cash (Max and Yermack 2016). The change in perception has been tremendously positive since the primary issue was the security of the digital accounts. Other issues pertaining to calamities cannot be fully taken care of since they are unforeseen.

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These shipments are likely to be delayed in the event of a transfer of paper money for the items required. Virtual currency is steadily overwhelming the use of cash since many people are already using credit cards. They are secure and when stolen reports can be made to the service providers to have them blocked. Furthermore, the incorporation of fingerprints has really enhanced the security of personal details and identification. Fingerprints are unique to every individual and thus one’s card cannot be used by any other person other than the owner. The use of credit cards and account transfers have thus steadily risen with an utmost precision in the use of credit cards (Dong et al. These have gone a long way in even fastening the transactions between the providers and clients.

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This is practically due to the fact that the returning of balances is eliminated from the activities of operation. Furthermore, there are certain services that require one to have some loose change with them such as car parking services. The stress in carrying such cash around has been eliminated by the use of credit cards that automatically deduct the exact amount owed and records the transactions. The use of cash has tremendously reduced to this effect especially in transactions that involve large amounts of money. This clearly defines the essence of digital payment techniques. They are safer and convenient (Robleh et al. The reliability of cash payment is withstanding but then there are insecurities that water down the point. For instance, there is a great possibility of an individual issuing fake currency notes that might go undetected at times.

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The stablecoin emerges to stabilize value and thus problems of volatile prices is somehow solved. However, not all traders are beneficiaries depending on one’s position in the production and supply chain. The crucial aspect, however, remains the stability of value or the prices. The stablecoins are mostly pegged to assets such as gold, diamond or other valuables. This way a single coins value does not change regardless of the prevailing market conditions (Jarrett et al. People have embraced technology and use less of cash in the present day. Furthermore, the use of cryptocurrencies such as the stablecoins in valuing items alienates the old paper system of valuation. The digital currencies are taking over the world with a profound use of cards including the credit and debit cards.

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