Bitcoin: Main Trends and Perspectives

Abstract

Background: Methodological ground for Bitcoin (BTC) as a variation of private money was settled by F. von Hayek (Denationalization of Money: An Analysis of the Theory and Practice of Concurrent Currencies - London Institute of Economic Affairs, 1976). Article takes a point of view on BTC as a modern example of private money based on IT - technology and principles of cryptocurrency exchange. Aims: We aimed to define BTC specifics as a competitive alternative currency and to establish its main trends and perspectives. Study Design: Analytical review. Place and Duration of Study: CEMI Russian Academy of Sciences, 2013-2015. Methodology: Methodology is based on complex approach which includes retrospective analysis of historical events, predating the appearance of BTC, formally logical look on main problems for BTC user likely to encounter; and an IT-leading exert evaluation method to forecast its main trends and perspectives. Results: We have established a set of mathematical equations to reflect main source of income for BTC-user; covered potential perspectives of BTC (based on this set), in case of different development scenarios (different types of government regulations on BTC) including low purchasing capacities during imposed restriction. Conclusion: BTC is an important innovation in a financial exchange. Very fact of it emergence reflects todays main modern trend towards "information society". Exchange systems like BTC (improved, revised, upgraded) should take it rightful place in everyday life.