Handbook of Digital Currency

Bitcoin, Innovation, Financial Instruments, and Big Data

2nd Edition - July 2, 2024
Editor: David Lee Kuo Chuen
Language: English
Paperback ISBN:
9 7 8 - 0 - 3 2 3 - 9 8 9 7 3 - 2
eBook ISBN:
9 7 8 - 0 - 3 2 3 - 9 8 9 7 4 - 9

Handbook of Digital Currency: Bitcoin, Innovation, Financial Instruments, and Big Data, Second Edition offers readers new ways to learn about subjects outside their specia… Read more

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Handbook of Digital Currency: Bitcoin, Innovation, Financial Instruments, and Big Data, Second Edition offers readers new ways to learn about subjects outside their specialties and provides authoritative background and tools for those whose primary source of information is journal articles. Encompassing currencies, payment methods, and computer communication protocols, digital currencies are growing in use and importance. The book's comprehensive view of the field covers history, technical, IT, finance, economics, legal, tax, and the regulatory environment. For those coming from different backgrounds with different questions in mind, this new edition is an essential starting point.

Cover image
Title page
Table of Contents
Copyright
Contributors
Foreword
Preface
Part 1. Digital currency and bitcoin
Chapter 1. Introduction to Bitcoin
1.1. The next generation of money and payments
1.2. Digital currency as alternative currency
1.3. Cryptocurrency
1.4. General features of bitcoin
1.5. Benefits and risks
1.6. Impact of the digital currency revolution
1.7. Conditions for a successful cryptocurrency
1.8. Future prospects and conclusion
Chapter 2. Is Bitcoin a Real Currency? An Economic Appraisal
2.1. Introduction
2.2. History and background of bitcoin
2.3. Bitcoin's weaknesses as a currency
2.4. Conclusion: Obstacles faced by bitcoin
Chapter 3. Bitcoin Mining Technology
3.1. Introduction
3.2. Technology behind bitcoin
3.3. Mining process
3.4. Mining possibilities
3.5. Mining pools
3.6. Threats to mining
3.7. Relocation of mining facilities
3.8. Recent advancements
3.9. Conclusion
Chapter 4. National Cryptocurrencies
4.1. The first wave
4.2. The future of national cryptocurrency
4.3. Conclusion
Chapter 5. Evaluating the Potential of Alternative Cryptocurrencies
5.1. Introduction
5.2. Different types of altcoins
5.3. Launching an altcoin
5.4. Data collection and altcoin evaluation strategy
5.5. Altcoin evaluation results
5.6. Empirical research using social network data
5.7. Empirical analysis using time series and cross-section data
5.8. Conclusion
Appendix empirical analysis of bitcoin and altcoins
Appendix
Chapter 6. The Effect of Payment Reversibility on E-Commerce and Postal Quality
6.1. Introduction
6.2. The model
6.3. Basic case
6.4. Results with postal quality
6.5. Conclusion
Chapter 7. Blockchain and Digital Payments: An Institutionalist Analysis of Cryptocurrencies
7.1. Introduction
7.2. Definition
7.3. The structure and the incentives behind the supply and demand of cryptocurrencies
7.4. Understanding institutional change
7.5. The ceremonial encapsulation of cryptocurrencies in the established model of regulation for digital payments
7.6. Cryptocurrencies as mature payment technologies: Challenges in the near future
7.7. Conclusions
Chapter 8. Counterfeiting in Cryptocurrency: An Emerging Problem
8.1. Chapter overview
8.2. Introduction: Cryptocurrency has virtually evolved from hard currency
8.3. The basic function of currency: A medium of exchange
8.4. Counterfeiting: Methods, motivation, and opportunities
8.5. The global anticounterfeiting initiative
8.6. Deterring counterfeiting in the future
8.7. Summary
Chapter 9. Emergence, Growth, and Sustainability of Bitcoin: The Network Economics Perspective
9.1. Network economics and cryptocurrencies
9.2. Sustainability of a cryptocurrency network
9.3. Discussion/conclusion
Chapter 10. Cryptocurrencies as Distributed Community Experiments
10.1. Introduction
10.2. From Bitcoin as single cryptocurrency to an ecosystem of cryptocurrencies
10.3. Altcoins as evolutionary problem solving and “proof of concepts”
10.4. Overview of the main critique and discourse on cryptocurrencies
10.5. The future of the blockchain
10.6. Conclusion
Chapter 11. Extracting Market-Implied Bitcoin's Risk-Free Interest Rate
11.1. Introduction
11.2. A model for the determination of bitcoin's risk-free interest rate
11.3. Application to US$ and euro data
11.4. Perspective on bitcoin interest rate
11.5. Conclusion
Chapter 12. A Microeconomic Analysis of Bitcoin and Illegal Activities
12.1. Introduction
12.2. The baseline model
12.3. Market equilibrium
12.4. Demand for bitcoins
12.5. Extensions
12.6. Concluding remarks
Chapter 13. Legal Issues in Cryptocurrency
13.1. Introduction
13.2. Legality versus illegal
13.3. Global regulatory movement
13.4. Conclusion
Chapter 14. Cryptocurrency and Virtual Currency: Corruption and Money Laundering/Terrorism Financing Risks?
14.1. Corruption: A social evil
14.2. Review of financial action task force on money laundering compliance on PEPs
14.3. Cryptocurrencies and virtual currencies and their potential to be misused for money laundering
14.4. The way forward: A conceptual intelligence-led AML/CTF strategy
Chapter 15. A Light Touch of Regulation for Virtual Currencies
15.1. Introduction
15.2. Legitimate uses
15.3. Potentially regulated risks
15.4. Survey of regulatory approaches in tackling these risks
15.5. Highlight on US regulation
15.6. Toward a light-touch approach to regulation
Chapter 16. Real Regulation of Virtual Currencies
16.1. Introduction
16.2. Background
16.3. Bitcoin prosecutions
16.4. FinCEN regulation of virtual currencies
16.5. SEC regulation of virtual currencies
16.6. CFTC regulation of virtual currencies
16.7. IRS treatment of virtual currencies
16.8. FINRA concerns regarding virtual currencies
16.9. Congressional concerns regarding virtual currencies
16.10. Conclusions
Chapter 17. A Facilitative Model for Cryptocurrency Regulation in Singapore
17.1. Introduction
17.2. Background to cryptocurrencies
17.3. Clear and targeted regulation
17.4. A self-regulatory framework
17.5. International coordination and harmonization
17.6. Conclusion
Chapter 18. Advancingz Egalitarianism
18.1. Introduction
18.2. Development of centrally controlled money systems
18.3. A new paradigm: Decentralization of authorities
18.4. Practicalities
18.5. The future of blockchain-based systems
18.6. Conclusion
Chapter 19. How Digital Currencies Will Cascade up to a Global Stable Currency: The Fundamental Framework for the Money of the Future
19.1. Introduction
19.2. Commodity backed digital mint
19.3. Derived commodities
19.4. Cascading
19.5. Outlook
Chapter 20. Bitcoin-Like Protocols and Innovations
20.1. The bitcoin system and the element of trust
20.2. A new digital commodity
20.3. Pseudonymous ownership and trades
20.4. An open and decentralized ledger system
20.5. Blockchain, mining, block time, and forks
20.6. Validation of transaction over a peer-to-peer network
20.7. Operation via open-source protocols
20.8. The anatomy of bitcoin
20.9. Bitcoin ecosystem
20.10. Benefits of bitcoin: An assessment
20.11. Future-proofing bitcoin: Addressing key risks
20.12. Potential demand drivers for bitcoin
20.13. Conclusions: The new vistas opened up by bitcoin
Chapter 21. Blockchain Electronic Vote
21.1. The problem with proprietary voting systems
21.2. Open-source, free software electronic transaction and voting systems
21.3. Conclusion
Chapter 22. Translating Commons-Based Peer Production Values Into Metrics: Toward Commons-Based Cryptocurrencies
22.1. Introduction
22.2. Commons-based peer production
22.3. Value metrics
22.4. Complementary currencies
22.5. Conclusion
Chapter 23. The Confluence of Bitcoin and the Global Sharing Economy
23.1. 2008 stimulus
23.2. Confluence of bitcoin and the global sharing economy
23.3. Sharing economy
23.4. Resource ownership versus access
23.5. Mental accounting
23.6. Bitcoin
23.7. Distributed network
23.8. Token lifecycle
23.9. Device-level resources
Chapter 24. What Does Cryptocurrency Mean for the New Economy?
24.1. Introduction
24.2. Bitcoin
24.3. A money narrative
24.4. Beyond money
24.5. Conclusions
Chapter 25. Bitcoin: A Look at the Past and the Future
25.1. Reasons for success and failure
25.2. A numismatic approach
25.3. The end of money
25.4. The role of the government
25.5. The role of banks
25.6. Future possibilities
Chapter 26. Bitcoin Initial Public Offering, Exchange-Traded Fund, and Crowdfunding
26.1. Introduction
26.2. Initial public offering: Digital CC
26.3. Exchange-traded fund: Winklevoss Bitcoin Trust
26.4. Crowdfunding
26.5. Conclusion
Chapter 27. Bitcoin Exchanges
27.1. Introduction
27.2. Bitcoin exchanges
27.3. Exposure to risk of exchange failure
27.4. Survival time of an exchange
27.5. Discussion
27.6. Conclusion
Chapter 28. Understanding the Evolution of the Internet: Web 1.0 to Web3.0, Web3, and Web 3+
28.1. Introduction
28.2. The evolution of the internet: Web1.0-Web2.0-Web3.0
28.3. Why Web3+?
28.4. Web3 use case
28.5. Web3 risks and limitations
28.6. Web3 future outlook
28.7. Conclusion
Chapter 29. Historical Experience of Money and Future Expectations on Digital Money, Cross-border Payments, and the International Monetary System
29.1. Three major transitions of money
29.2. Experience gained from history and the enlightenment for the central bank digital currencies
29.3. Evolution history of the international monetary system
29.4. Some considerations and enlightenment
Chapter 30. Introduction to Central Bank Digital Currency and Key Considerations
30.1. Introduction
30.2. Motivation of issuing CBDC
30.3. Design choice of CBDC
30.4. Conclusion
Chapter 31. Tokenization and Enterprise Blockchain
31.1. Blockchain systems and tokenization
31.2. Enterprise developments and consortium blockchain
31.3. Enterprise adoption and tokenization
31.4. Appendix A comparison of consortium platforms
31.5. Appendix B comparison of selected Chinese enterprise projects
Chapter 32. Stablecoins
32.1. Introduction
32.2. Taxonomy of stablecoins
32.3. Current stablecoin market
32.4. Roles of stablecoins in DeFi
32.5. Recent developments
32.6. Research
32.7. Conclusions
Index

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Handbook of Digital Currency

Bitcoin, Innovation, Financial Instruments, and Big Data

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David Lee Kuo Chuen