A COMPARISON OF CRYPTOCURRENCIES AND TRADITIONAL CURRENCIES

Yousef Jahmani and Yonpae Park

Review of Business and Finance Studies, 2023, vol. 14, issue 1, 45-61

Abstract: This research comprehensively compares traditional currency systems and cryptocurrencies, exploring their advantages and disadvantages. Traditional currencies have enjoyed widespread acceptance due to their tangibility, simplicity, stability, and regulatory backing by governments and central banks. However, they are susceptible to inflation, counterfeiting, and high transaction fees. Cryptocurrencies offer decentralized, secure, anonymous transactions without intermediaries. However, they face challenges incybersecurity, scalability, illicit use, environmental impact, and regulatory oversight. The study further examines cryptocurrencies' potential benefits and risks, such as stability, cost-effectiveness, and financial inclusion, while cautioning against potential cybersecurity threats and illicit activities. It underscores the role of governments and regulatory bodies in addressing these challenges and fostering the coexistence of traditional currencies and cryptocurrencies. The research aims to shed light on the transformative potential of cryptocurrencies, emphasizing the importance of prudent decision-making by investors and policymakers in navigating this dynamic financial landscape. It encourages further exploration of innovative solutions to address the drawbacks while harnessing the advantages of both currency systems for a more inclusive and secure global economy.

Keywords: Cryptocurrency; Traditional Currency; Blockchain; Decentralization; Advantages; Disadvantages (search for similar items in EconPapers)
JEL-codes: M00 O10 (search for similar items in EconPapers)
Date: 2023
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