The last several years are characterized by the rapid rise of Bitcoin. Its rates achieved the highest ranks and provoked a powerful reaction in the market of virtual currencies. Investors and coins owners acquired a potent tool to perform financial operations and guarantee particular stability. The given shift of priorities from traditional to innovative currencies also preconditioned the emergence of multiple debates regarding the future of this payment method and its use in deals. At the same time, the popularity and power of precious metals were doubted. However, the rise of Bitcoin was followed by its downfall as its price quickly became lower and created the ground for a new wave of discussions about the reliability of the coin and its ability to be used at the international level. For this reason, there is the need for in-depth research of the given aspect with the primary aim to determine its potency, nature, and correlation with alternatives such as precious metals. Nevertheless, bitcoin is not the only virtual currency that is used in the modern world. There are also Ethereum, Dash, Litecoin, and Monero that are characterized by the ability to accumulate money and serve as the promising investment to monitor the state of the market and play on forex rates. Therefore, at the moment, it is one of the most well-known coins because of the recent rise and shock caused by its blistering growth. However, precious metals trading has always been an alternative to innovative methods because of their traditionally high reliability and understandable character. Cogitating about the forces impacting both these options, researchers assume that they are vulnerable to similar processes happening within the market and stock. For this reason, the need for an in-depth investigation of the current situation along with the analysis of the perspectives and problems associated with these cryptocurrencies becomes obvious.
The research is needed to determine several factors. First, aspects impacting the demand for Bitcoin, Ethereum, Dash, Litecoin, and Monero, precious metals as the alternative, and fiat money should be investigated. Second, the peculiarities of their management and manufacturing should be discussed. Finally, these means of payment should be compared to understand the advantages and disadvantages and their potential (Morisse, 2015). The problem is complicated by the fact that there is no generally accepted methodology utilized to investigate all peculiarities of the currency. For this reason, there is also the need for the in-depth investigation of sources devoted to the issue with the primary aim to determine approaches the authors used to acquire credible data needed for the research. Only considering these elements an appropriate analysis can be made.
The blistering rise of multiple cryptocurrencies triggered various processes in the world. However, it endangers a traditionally potent position of precious metals which has been used as the central financial assets and objects of interest for investors. Moreover, the weakening of their position impacts fiat money that does not have intrinsic value but is opposed to those which has it. In such a way, differences in the position of Bitcoin affect the whole market and other financial tools that have a significant impact on the global market. There are multiple fears related to the nature of these coins. The use of cryptocurrency presupposes complete confidentiality and the absence of monitoring (Biryukov, Khovratovich, & Pustogarov, n.d.). It creates the basis for the emergence of multiple uncontrolled flows of money that will be used for transactions on the Internet. This tendency might have a pernicious impact on the governments ability to regulate inflation and introduce appropriate measures to attain its needed levels. Regarding these facts, oscillations in cryptocurrencies prices and their velocity might pose a significant threat to the traditional financial system, the market of precious metals, and fiat money. The increase of fiat risks can also trigger the development of various processes in countries where they are introduced (Biryukov et al., n.d.). At the same it, it can precondition the emergence of undesired changes in the global economy and financial crisis. For this reason, the investigation of the problem becomes critical for the creation of the appropriate solution.
Altogether, cryptocurrency can be considered an important tool in the modern financial sphere. Its central advantage is another approach to its manufacturing and the possibility to be used on the Internet that becomes the main platform for various deals. However, the rise of this payment method might threaten the position of precious metals and fiat money because of the emergence of a direct rival and numerous opportunities for new investments. For this reason, future research should be focused on the investigation of Bitcoins ability to become the central financial asset that will attract the attention of all potent players and replace other currencies that are not so innovative. The understanding of these mechanisms is fundamental for further analysis.