Abstract

In recent years, the world has been introduced to digital currencies, cryptocurrency. Due to the growth of technology globally, cryptocurrency growth has skyrocketed to a higher height beyond the standard banking system we all know about. One fundamental and crucial reason for the development of cryptocurrency is the acceptance and adoption of digital currency in most significant corporations in their transactions. Therefore, I will be discussing the evolution of cryptocurrencies, different kinds of cryptocurrencies. I will explore the most common form of cryptocurrencies like Bitcoin, Ethereum, Ripple, among other upcoming digital currencies, has been in use, especially in the United States America. Furthermore, I will describe in depth about the block chain technology, crypto currency as a commodity, traditional banking, various demerits and benefits of using the crypto as a means of money exchange. Finally, the paper will check on the risks posed by the cryptocurrency developments.

Keywords: anonymity, block chain, crypto, commodity, decentralized finance, digital currency, international payment, international business, pyramid, traditional banks, trading

How are Cryptocurrencies Shaping the Future of the Financial Market?

Introduction

Cryptocurrency has been defined as a digital currency that can be utilized to purchase goods and services over the network and internet. The entire phenomenon makes use of an online ledger that is designed to have very firm cryptography mechanisms that ensure safety and protected business transactions over the internet. Furthermore, cryptocurrency security has increased the confidence among people compared to the traditional methods where one had to carry visa cards and a considerable amount of money in their pockets, putting them at more risk of being robbed. Also, cryptocurrency has been making free from centralized banking systems to decentralized ones making it accessed through many more channels, which are even safer than the centralized banking systems. The world economy and money market are currently forecasting the power of cryptocurrencies, which is universal across all countries. Thus, financial institutions need to reconsider endorsing cryptocurrencies in their transactions to bring the world's required changes about money. (KUMAR, 2020)

The evolution of cryptocurrency has followed a well-defined route since the introduction in 2009. According to the world economic data, cryptocurrency has already built a smooth ecosystem that allows more and more forms of crypto to be introduced in the world's future finances. For instance, in the year 2017, more than 1000 different cryptocurrencies were listed in the world financial market, which was already participating in the daily transactions. The number has risen; we have more than 5000 other cryptocurrencies that are operational. Besides, the transactions which take place over the crypto network, especially Bitcoin, have been on the rise with about 60 percent each year for the last five years. Due to its nature, infographic keeps on unpacking across the world of cryptocurrencies, encouraging the stakeholders among other key players across the finance sector to continue growing its significance to the world. (Neufeld, 2020)

Furthermore, various key players have been involved in the development and advocacy of cryptocurrency around the world. To begin with, the sector has been at the forefront to advocate and structure cryptocurrency. To give an illustration, Institutional investors such as Harvard Endowment Fund and Crypto Hedge Funds are found within the world of cryptocurrency. According to Neufeld (2020), the technology giants such as IBM and Microsoft Corporation are participating in transactions that are channeled through crypto. Moreover, in the private sector, financial institutions and banks are now taking part in digital currency. Surprisingly, some of the countries are also involved in cryptocurrency. For instance, Venezuela is on the list which is involved in crypto businesses. Other central banks from China and Saudi Arabia have also invested in digital currency to enhance their economies.

Overview of current block chain technology

Block chain is a promising and revolutionary technology since it has been helping in reduction and risks, eliminates fraud and brings transparency in a measurable way for millions of users.

For cryptocurrency to function according to its cryptographic mechanism, it has an underlying technology that uses block chain technology. Block chain technology can be defined as is a configuration that can store financial transaction records from the public in various databases via a network that is interconnected in a peer-to-peer manner. The fascinating fact about block chain is that it resembles the typical kind of database. It stores data in blocks that are then chained together, forming a long chain of data arranged in chronological order. Once one block reaches its maximum, it is immediately connected to the previous block, and a new block is added until it is fully occupied. In cryptocurrency, block chain technology is used to decentralize ledger records so that no single-use has control over the information. (CONWAY, 2020)

Block chain is the backbone of cryptography as it allows transaction records to be entered in a very secure and memorable way. For instance, all the information recorded in the decentralized blocks is exclusively immutable in the manner that it cannot be undone once registered. For example, once a Bitcoin transaction has been submitted, it is visible to every user in the block chain, and the transaction history is permanent. Due to this feature, block chain is a way to store information transparently. Furthermore, the one benefit block chain offers is the security. It cannot be altered thus, keeping the blocks secure. Another attribute of block chain is that it is on away kind of information transactions. Currently, several block chain-based projects wish to implement block chain to help society other than just recording transactions. (CONWAY, 2020)

Due to its popularity and effectiveness, this technology was initially developed for financial transactions only, but block chain can be used in various fields. For instance, the healthcare sector is in the process of adopting block chain technology that will enhance the adequate storage of patient records in a safer manner (Kuo et al., 2019). However, block chain technology, just like other kinds of upcoming inventions, especially in the financial market, is faced with security concerns such as scalability. For instance, the number of transactions on a single block of data may have overwhelming information, which may hinder the entire block chain’s proper function in a given data center. Although, this problem can be solved in two primary methods. Storage optimization of block chain can be used to eradicate the storage issue associated with the size of the block chain. In the future, block chain technology may be redesigned to have a crucial block for the ledger and a micro block to store transaction records only. (Zheng et al., 2017)

Furthermore, cryptocurrency is faced with privacy leaks due to the underlying block chain technology of transparency. Once a miner has initiated a transaction with another miner, the block chain private and public keys can only have an only certain level of privacy. To both parties, their actual balances will be visible to everyone, which from the recent research poses some privacy issues because this can be used to get other crucial information about the client involved in cryptocurrency transactions. However, even with these threats on the block chain and cryptocurrency clients, the problem can be solved with the mixing method aspect, which ensures that anonymity in transferring funds from source to destination. Digital assets can be send using multiple input addresses and received using multiple output addresses to create the desired anonymity. Another way to reduce privacy leak is by ensuring complete anonymous transactions whereby payments are separated from transactions to eliminate transaction graph analysis. (Zheng et al., 2017)

In conclusion, block chain has a large number of applications in almost every industry. Ledger technology can be used to track financial fraud, securely share medical records among health care professionals and even act as an effective means of tracking intellectual property in business and music rights for artists.

Crypto - Currency or Commodity

An engaging and never-ending debate shall go on this topic because our traditional knowledge is limited to define what actually a currency or commodity means for the buyers and sellers. Similar to the situation raised a few years back when gold and silver was used as an exchange for goods and services, Bitcoin and other cryptocurrencies have landed under the same questionable circle.

Since the introduction of cryptocurrency in the world financial market, there have been various attempts to make cryptocurrencies commodities just like other physical common commodities which are traded. For instance, gold and crude have been in the foreign exchange market for more than five decades. Due to the value gauged against the most popular cryptocurrencies such as Bitcoin, Ethereum among others, it has been considered commodities by some of the world's power commodity regulators. Therefore, considering Lucking & Aravind (2020), Commodity Futures Trading Commission (CFTC) which resides in the United States, has been involved in regulating and mandated oversight of tangible commodities marketplaces some time in history. As technology keeps on advancing, more cryptic commodities coming on board in the market, such as futures (deliverables) and other intangible commodities such as cryptocurrencies transacted over the counter, have been deemed commodities.

In 2015 CFTC, the first form of cryptocurrency, Bitcoin, was declared a commodity under the CEA in an implementation exploit. Since then, Bitcoin has been in the world market, especially in forex and other financial exchange forms where individuals invest for various reasons. This has created a platform where cryptocurrencies can be compared and traded against different types of commodities such as gold and crude oil, which have almost the same value as that of Bitcoin, for that case. In 2019, CFTC declared that the evaluation of other cryptocurrencies such as Ether which are doing well in the world financial market, be included in the commodity lists as it was done for Bitcoin. Ethereum is the second-largest cryptocurrency by market capitalization, closely following Bitcoin in digital assets. From the recent study, cryptocurrencies have been accepted in the commodity market, which shows the world economy's growth day by day. (Lucking & Aravind, 2020)

Figure 1 : Comparison of Cryptocurrencies by Market Cap and the changes of Bitcoin value over time

There are two main types of crypto, one for the purchase of goods and services and those that allow for the creation of smart contracts. Bitcoin and Ethereum comprise a large part of the cryptocurrency market as shown above however there is growth and growth. For example, there are over 1000 currencies currently in existence. More than 600 have a market capitalization of more than $ 100,000. (MAZER 2018)

Some of the problem with cryptocurrency identification lies in the fact that bitcoin was originally considered a payment method, but now rarely carries the characteristics of dollars, euros or pounds. It is of little use as a valuable store because of its volatility, and is restricted as a way to exchange its slow network with high transfer costs. The growing bitcoin lending market gives clues to its behavior. Bitcoin lending provides credit lines for crypto companies that make money in currencies, such as payment processors or miners, looking to earn traditional money by paying for expenses. (Wilson, 2020)

Also, traders who do not want to sell their ownership of bitcoin use it as collateral to borrow money for algorithmic or high-frequency trading use. For those who lend money, high yields are an attractive proposal in the era of the lowest rates. Key features of this market, such as the discovery of market-driven pricing and liquidity incentives, reflect that of product leasing, according to market players and economists. Thus, crypto has a currency and a commodity value. (Wilson, 2020)

Finally, a wide range of secure transactions, currency exchanges, and unauthorized access, cryptocurrency has lifted barriers facing large and small industries who have struggled to hunt down investors for the project and their views. Coin by definition, means something used as a means of exchanging goods and services. On the other hand, the product is defined as a material that can be purchased and sold as well.

Utilization of cryptocurrencies in the international business

Crypto keeps on to drawing a lot of attention from investors, entrepreneurs, fund managers and the general public. Many recent public debates on currency exchanges have resulted in significant changes in their prices, claiming that the currency market is a bubble without any underlying guarantees, as well as concerns about the evasion of legal and regulatory oversight.

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Figure 2 : Investment Spike in blockchain related companies

Investors are get early access to the technology, and they can use it as they see fit. Startups have the potential to raise money without solicitation from private investors or project capitalists. In addition, chain-related projects have raised more than $ 1.6 billion through ICOs to date, while project capitalists have provided only $ 550 million to cryptocurrency companies for more than 120 contracts. (MAZER 2018)

For so long, the entire world has relied on banking systems in transferring money and other commodities. Besides, international businesses have depended on the standard bank transaction to complete a deal on the table. Due to network connectivity with the involved international banks involved in the money transfer, the process becomes too slowly causing uncountable inconveniences to the receiving banks. According to Coppola (2021), to eliminate this menace, there came a technological improvement that made use of SWIFT messaging, which eliminated the delayed international payments that replaced the old postal and fax communications. Even after this critical improvement in global business payment procedures, there are still significant tradeoffs that are yet experienced in most international business transactions. For instance, the time spent making payments and the cost involved is always higher, hindering economic growth. With the introduction of cryptocurrencies in the forex market, international business payments have drastically changed.

Currently, cryptocurrency has already by-passed the traditional banking systems whereby the transactions of funds across the world, central banks, and private banks have been made easier for businesses in the world as a whole. For to happen, technological developments have been deliberated, which has ensured the businesses funds have been secured from any kind of insecurity while in transit from one account to the other over a secure connection. The aspect of block chain and cryptography is also used to hide the parties involved in fund transfers. Furthermore, cryptocurrencies do not require any form of centralization. As with central banks, the transaction expenses are entirely very low as paralleled to central bank RTGS fees. International businesses should embrace the cryptocurrency digital currency to ease sending and receiving money across the world. If the companies are running different currency accounts, it is possible to run the same cryptocurrency account to facilitate the transaction delays and procedures. (Coppola, 2021)

As of now, the most widely used kind of cryptocurrency in international business transfers is Bitcoin. Bitcoin has given rise to other cryptocurrencies such as Dash, Litecoin, Monero, and Ethereum, whereby each uses a different mechanism while engaging in international payment. For instance, Bitcoin and Ethereum make clones, Bitcoin Cash and Ethereum Classic, respectively. For the case of Ripple, it makes use of universal digital payments protocol as its innate cryptocurrency. Another essential fact about cryptocurrency and international business payments is that they can be used in cross-currency payments anywhere in the world. According to Coppola (2021), the amount of fee involved in forex market exchanging between crosses and cryptocurrency can reduce the expenses involved so long parties have agreed to use Bitcoin or any other cryptocurrency for that matter. Hence, cryptocurrencies have come to reduce the amount of money spent transferring funds from one international business account to the other.

Consequently, international businesses are faced with numerous risks that the technology of block chain and cryptocurrency is yet to overcome. Firstly, the exchangeability challenge. Most cryptocurrencies will only allow exchanges with just the most popular currencies, such as the USD, GPB, and JYP, which are always at the top of the world market. Due to this phenomenon, the most minor used currencies lack the option of engaging in cryptocurrencies, especially in the developing countries where investors are willing to make transfers using any of the cryptocurrency mediums. As a result, most investors in these countries entirely rely on the traditional model of paying international business partners. Secondly, the rate at which cryptocurrencies volatiles may put the entire business into a standstill because of immeasurable losses incurred in no time. Usually, only a limited business will benefit from cryptocurrencies while making exchanges with international business partners. (Coppola, 2021)

The traditional role of banks

The goal of the banking system is to provide security and confidence in the economy. If banks were allowed to go bankrupt and consumers lose savings; it would cause great financial fear and many consumers would withdraw their savings and keep cash. If there was a withdrawal of money it could lead to a shortage of lending funds. This is why the central bank acts as the final solution lender.

Traditional banking systems have been there for centuries now, whereby they all offer the same kind of survives to their customer across the globe. The most common function of all traditional banks, which all banks universally adopt, is accepting deposits from customers and giving loans. Commercial banks are primarily involved in obtaining funds from their customer, channeled into various account types based on their preferences. For instance, customers may have fixed accounts, current accounts, and joint saving accounts. Moreover, banks offer loan services to customers, which act as the primary income source to most traditional banks. Once a customer has been granted a loan, he/she must return the money with some added interest from which that bank can run its daily business. Most banks offer various kinds of loans such, cash credit, short-terms, and demands. Gjelsvik, M. (2017).

If the account owner does not have enough money in his account, the bank may decide to give an overdraft to the customer on request. Traditional banking systems offer these services whereby the account owner who has been over-drafted is needed to pay extra interest, unlike the one who was granted a loan. Also, banks give overdrafts in the form of salary advances if the customer has shown the possibility of security in future engagements. Besides, Gjelsvik, M. (2017) states that traditional banks have been involved in offering discounts to customers upon exchange bills. Business owners and small-scale traders are granted loan advances based on the number of bills of exchange given be way before the time of maturity.

Additionally, banks do offer investment funds depending on the business proposal one is willing to start. For instance, if one is will to invest in real estate, the bank will partner with him or her and finance all of the projects until their completion. Once it's over and commissioned, the bank will take back its funding and the number of agreed interests.

The operation of traditional banks does affect the economy in various ways. During monetary intermediation, the bank can transform multiple assets and liabilities thus, participating in economic growth. For instance, fixed saving accounts are owned by individuals who already have a surplus in their financial circulation. The moment they keep the money in the bank, money borrowers who do not have enough money to set-up an enterprise are enabled when the bank accepts to lend them money. In the process, the economy keeps on growing to facilitate infrastructural development. Besides, the bank and the borrower will have to pay taxes to the national government, which is used to offer better services to the public and other investments. The traditional banks are used as an intermediary between the surplus money in the public domain and the economy in general, browsers, and the government. (Guru, 2021)

In addition, traditional banking keeps on encouraging the public and investors to keep on saving on their money in that, in the future, they will be able to borrow more money from the same financial institutions if they wish to expand their businesses. From this, the government can correct more taxes, the bank earns more interest, and the business grows, having more profits. The business owner will need more labor force from the community around his/her business enterprise who will liquidate their money. In such a scenario, the economy is in a position to thrive better. More so, the bank has been on the front line in promoting the trade in investment and production by reassuring and encouraging the public to save by organizing assets in the public domain. Traditional banks have been helping to upsurge the collective percentage of investment in the economy (Guru, 2021)

In summary, traditional banking systems has been there even before the introduction of cryptocurrencies. More improved systems and procedures need to be put in place to support the advancement in cryptocurrency.

The advantages and disadvantages of using cryptocurrencies in an international payment

Advantages

Since the introduction of cryptocurrency in the world market in 2009, the world has enjoyed various benefits of having the unique kind of digital currency, which has taken to the sky due to its popularity and incredible value over other standard forms money. Firstly, cryptocurrency is fully supported by block chain technology, which uses cryptography mechanisms to safely guide the information and transaction details of the parties involved in the transaction. Cryptocurrency guarantees clients privacy. The anonymity deal with these mediums of exchange has increased the popularity of Bitcoin among other cryptocurrencies. According to the number of people who do not have the required documents to be allowed to own a bank account that is close to 1.7 billion people, crypto has made it easy for such persons. Especially in some of the marginalized countries, access to bank account is prohibited. With cryptocurrency, such people in our society now can have access to this form of exchange. (Neufeld, 2021)

Additionally, the kind of efficiency has also advocated for the cryptocurrency to most of the business people. Crypto has reduced amount financial settlement as compared with the type of currency available in the forex and other money markets. It is believed that cryptocurrency choosing to transaction cryptocurrency instead of other currency forms enables customers to save up to 16 billion dollars in a single year. Besides, cryptocurrency has one of the most sophisticated security forms that will allow the clients to send an irreversible transaction that is fully traceable and transparent to the entire cryptocurrency network. Furthermore, the intelligent contract aspect, which is associated with programmable digital currency, has considerably cheapened the manual administration of work. Finally, smart contracts have now been utilized in the automation of government responsibilities, for instance, when pulling together taxes, giving out permits, forfeiting subsidizations, and managing local or nationwide elections by various government agencies across the world. ("10 benefits of paying with cryptocurrencies | Mobisun International", 2019)

Disadvantages

A great deal of time has been spent developing and advocating for cryptocurrency and block chain technology in the money market. Apart from the benefits to international businesses, it also has drawbacks. As one of the cardinal and digital currencies, cryptocurrencies are also susceptible to underlying cybersecurity threats affecting other kinds of coins globally. For instance, hackers gain access to some of the clients using cryptocurrency and take advantage of the vulnerability. For the evidence recorded in recent future, numerous ICOs security has been broken and costing investors that lead to loss of millions of dollars to the affected cryptocurrency.

Additionally, the digital currency does lack a better price instability controller. As a result, cryptocurrencies are forced to lack a better inherent value regulated according to overall money values. However, adoption should of the crypto upsurge customer assurance and reduce irregular volatility. (Boukhalfa, 2019)

Furthermore, cryptocurrencies are currently facing the challenge of scalability. According to the rate at which digital monies are being and adoption by the money market. The amount of transaction which is received in every second has been affecting the effectiveness of international businesses. Additionally, the turnaround time for a single transaction involving cryptocurrency is relatively slow compared to other forms of payment methods. For example, MasterCard and VISA have one of the most real-time transaction turnaround times in the world. Until the substructure conveying this expertise is enormously mounted, the issues will not be solved as required. Therefore, such regression is multifaceted and problematic to do effortlessly to the international business. Other apprehensions that do interfere with cryptocurrency technology are varying procedures. These practices have been made necessary because they take place whenever technology is being upgraded. Depending on the amount of time it will take, the international business procedures get affected. (Boukhalfa, 2019)

Until recently, a 51% attack on bitcoin seemed unlikely. Increasingly, however, the attack, which involves hackers gaining control of multiple systems on the bitcoin network and changing operations on its blockchain chain, is becoming a reality. The latest proof of this comes from bitcoin gold, a bitcoin fork that started trading in exchange last year. According to a post on one of the currency exchange forums, the hacker is targeting an exchange that trades bitcoin gold. Thus, a thief may try to double the stolen money from an exchange by converting it into a fiat or other crypto currency and using the same coins from his wallet to buy more crypto. Thus, it is believed that the thief stole $ 18 million worth of gold. (SHARMA, 2018)

Impact of the broader use of cryptocurrencies in international business and on the future of financial markets

Since the introduction of cryptocurrency, the world has introduced new ways of conducting business across different corporation situated worldwide. Future market places will have more methods of transferring and converting currency from one place to the other in a simpler manner.

According to the statistic on the global market, the inspiration of cryptocurrencies on the International Monetary Marketplace yet remains relatively small compared to other kinds of commodities that have been participating in the world market for a longer time than that of cryptocurrencies. Having that in mind, it is still essential to understand the route that cryptocurrency has taken on the global world market and international businesses. Currently, cryptocurrencies have impacted international business from a much broader perspective, proven by the various international business players in the worldwide market. These key contributors include the standalone financiers worldwide, several worldwide corporations, and the governments globally that are entirely striving to begin better policies that concern cryptocurrencies. It has been noted that all three stakeholders work independently, but at the end of the day, they come together to facilitate economic growth. (Simonovsky, 2018)

Based on standalone financiers' work, the introduction of cryptocurrency has so far shown how it has been used for two main commitments. Firstly, cryptocurrencies are currently put together to expand selections either as a means of conjecture or as a border that is contrasted with a large-scale fiscal predicament. This technique has been usually used while trading some of the high-valued commodities such as gold and crude oil. Nowadays, cryptocurrencies do not directly interact with consolidated currencies traded in the old-fashioned stock exchanges. For instance, some professionals have articulated apprehensions that volatile cryptocurrencies' insertion into differentiated assortments discloses international marketplaces to more significant dangers in the incident that cryptocurrency prices smash. As of today, cryptocurrencies have remained a small portion of the world's financial assets, which are believed they cannot affect the worldwide financial market even if they fall apart. (Simonovsky, 2018)

Secondly, cryptocurrencies have impacted changes in the adoption whereby companies are currently openly trading stocks. The positive thing about this is that the global market is giving the best benefits to these companies. Therefore, cryptocurrencies are have already been considered by most of the people in the world as one of the most cutting-edge technologies that are demanded by most of the forward-looking corporations that want to prosper together with cryptocurrency. So, the financial market in the world has been impacted companies and their involvement in cryptocurrency. Thirdly, the effect of cryptocurrencies on worldwide financial markets has been affected by how the governments across the world based on how they have been reacting. Furthermore, different nation-state worldwide has been showing concerns about the cumulative significance of cryptocurrency rejecting or adopting combined technology into their identifiable financial systems. (Simonovsky, 2018)

In international business transactions, XRP is used in transferring of currency from one bank to the other in settlement between banks networks in the world. XRP make use of Ripple network while performing such transactions. For instance, most banks convert the currency first in US dollars since it us the common currency for exchange in the world but it takes not less than three days before money arrives to the desired bank. For XRP, one is required to convert currency in XRP before transferring whereby exchange fee is eliminated and money is received within minutes. Thus, XPR simplify transfers of money between different currencies. (Marr, 2020)

Stellar Lumens (XLM) network is one of the cryptocurrency technology which is powered by block chain technology systems that provides the platform that sustain execution of instantaneous payments. XLM Operates on DLT that make it to be independent from underlying banking regulations across the global. But the current banking systems eliminate instantaneous transactions in the present financial structure is due to disintegration. Therefore, Stellar network currently revolutionizing traditional financial payments across counties. Also, Lumens transaction fees have continues to be a fixed price of $0.00001 XLM and the transaction process takes place within seconds which has encouraged people to opt for cryptocurrency during transfers. (Lokhava at el., 2019)

Furthermore, New Economy Movement block chain is powered by XEM cryptocurrency that required one to verify currency transfer using unique protocol known as proof-of-importance (POI) algorithm. The advantage of NEM is that it make use of Two-tier architecture the connection to the rest of the block chain network thus speeding up the transactions speeds. (Mason, 2021). On the contrary, ENJ is a sequence block chain gaming platform that focuses on the creation of digital collection objects that are user-owned. The platform provides ways to create digital assets called ERC1155 signals for use in a variety of Video Games. Their use includes the art of collecting or even store coupons. Gaming chain allows players to have real ownership of their game items and sell them for value. The ENJ platform uses Block chain technology because of a wide range of technologies that include Real Product Ownership, Easy Exchange of Value, Savings Value, and One Wallet for all items. In addition, the ERC-1155 signal level is the purchase of many shipping activities and services that save on costs. (Michael, 2021)

VetChain is a block chain platform designed to improve business processes. It aims to simplify the processes and flow of information on multi-supply management through the use of distributed ledger technology. In addition, VeChain is a business blockchain platform that aims to provide full corporate feedback by separating information from data storages. Currently, VetChain plans to be a leading platform for the issuance of native currencies (ICOs) as well as operational activities between the Internet of Things (IoT) connected devices. In addition, VetChain's goals are to create an ecosystem that will be trusted to facilitate open flow of information, real interactions, and rapid rate transfer. (FRANKENFIELD, 2021)

Chainlink VRF recently went live on Ethereum's mainnet, and the PoolTogether game is the first project to adopt it. A proven track record is very important, and it is important for the development of many programs because it serves as a predictor to create predictions. As a result, Randomness is a key factor in game play and security usage and difficult and unpredictable environments, and giving unpredictable player awards like looting drops. It also creates a fair distribution of tariffs and resources, such as providing judges for cases or auditors with the companies under investigation. This solution can provide increased levels of reliability and transparency in basic process processes, which even developers cannot change. (Brown, 2020)

Chainlink is an underrated oracle network that provides real-world data for good deals on block chain. Smart contracts are the aforementioned agreements in a block chain that automatically evaluates information and implements when certain conditions are met. LINK signals are a digital asset symbol used to pay for services on the Internet. This process, along with more secure equipment, eliminates reliability issues that may arise if you use only one source. The process starts on a block chain enabled by a good contract when a good contract requires data. Such a good contract provides an information request.

("What Is Chainlink? Oracles, Nodes and LINK Tokens | Gemini", 2021)

Tron block chain technology is a promising block chain platform dedicated to a dedicated web and its infrastructure. In addition, it works with the TRON protocol, which they claim to be the largest chain operating system in the world. The key factors that drive TRON are its support for high-quality, high-level, high-level access, and support for TRON's rational language validity agreement in (Ethereum). TRON has slowly grown its platform infrastructure making it easier and better for developers. Some of the benefits of Tron chain technology enable the creation and deployment of imported software, and their web site TRON assists in making the process easier. RON has continued to promote the environment and has attracted more developers and users. TRON has 500 million smart contracts and over 2 million user accounts. Their system of development has also changed. Only time will tell if they will take on existing players. ("Tron Blockchain Technology - An Overview of Tron Smart Contracts", 2019)

In conclusion, future business transactions will heavy rely on the upcoming methods of transferring currency from one form to the other which will contribute to the global economy.

Risk of Cryptocurrency

Cryptocurrency is faced with various challenges which has been crippling its utilization. Due to the advancement in technology, cyber criminals has found another area where they can keep on experimenting their ill motive practices.

Crimes

Just like any other financial products and services which have been in the market for cryptocurrency and block chain technologies has featured the possibility of posing risks that may be used in propagating crime activities that mess up the entire world if not controlled and stopped with immediate effect. For instance, some money laundering activities have been confirmed to be fueled the cryptocurrency technology, which is hard to trace the source of the illegal transaction of money. Also, due to the anonymity nature of cryptocurrency transactions, terrorist financing has been shifted to this. The financier can send colossal amount money in the form of cryptocurrency without being detected, and there receiving terrorist withdraws the money in privacy. Unlike in the traditional banking system, where one is asked to the source, intentions of the money one wishes to transfer. (KEATINGE et al., 2018)

Furthermore, cryptocurrency has been involved in criminal activity. The recent one is the use of Bitcoin among other cryptocurrencies, having attracted monetary controllers, policymakers, and the general public to social media platforms' power. It has been noted that the sophistication associated with block chain and cryptocurrency, especially pseudonymous and the aspect of distribution of digital currencies, has been found to have some loopholes which need to be rectified before more damage happens. For instance, the subsequent struggle of mapping out payments has been confirmed to facilitate criminal bustle, which includes but is not limited to terrorist financing, money laundering and cybercrime, and other illegitimate manipulation. (Teichmann & Falker, 2020). Due to technological advancement in this digital currency sector, a criminal has gotten an edge whereby they can take part in underhand ways to wash out their illegally obtained money since most of the money does not need to be in the bank or near the regulatory bodies.

Crypto, a possible type of financial pyramid scheme.

There have been allegations pointing out that cryptocurrency is based on a pyramid scheme. The pyramid scheme is a business organization whereby top-level members going down the hierarchy level of monetary pyramids earn profit directly from members under them. For instance, the topmost member in the pyramid will get the largest share of the finances contributed by the new members who have joined the scheme. The pyramid is that it acts as a syndicate that does not offer any services or product, making it completely irrelevant. For instance, as more and more people join the crypto market, the prices get higher, only benefiting those at the topmost and those who pioneered the crypto. According to statistics, about 1,000 individuals currently have about 40 % of the whole Bitcoin market. Therefore, for cryptocurrency, there have been similarities that resemble those of the pyramid scheme. ("Is Cryptocurrency Just a Big Pyramid Scheme? 2021)

This phenomenon has been brought about by the behavior of those who have already associated themselves with cryptocurrency, such as Bitcoin; Ethereum encourages others to join the market through a link that is connected to their accounts. According to cryptocurrency reports, there used to be Crypto Offerings in the cryptocurrency market, no longer available to the clients. The entire market lead by the best crypto, Bitcoin, Ripple, and Ethereum, has reduced the offering by 50 percent, making it look like it is a scam. Most of the digital coinages in circulation have lost most customers due to the implications and lack of transparency. Additionally, there are massive swings in the world market where cryptocurrency is being traded. Only the hedges have the power to control the market and have the advantage over small and new traders. ("Is Cryptocurrency Just a Big Pyramid Scheme? 2021)

Consumption of energy

Since the rise of cryptocurrency (Bitcoin) from marginal technology, the current widespread cryptocurrencies, the world has experienced tremendous benefits from technological improvements on secure transactions to clients' engagement on contracts. As a result, an international and individual business owner has made histrionic wealth, with most taking home millions of dollars across the entire world. At the center of the cryptocurrency, a multi-billion-dollar industry has been commissioned, which was inspired by its revolutionary distributed technology. However, the industry has caused the world to suffer due to the effects of the amount of energy used by the underlying computer networks.

(MAZER 2018)

Miners compete to ensure continuous and profitable operations, using special equipment and cheap electricity. This competition helps to ensure the integrity of the activities in the money market

For instance, at a single model, the amount of energy required to operate the entire cryptocurrency and the block chain technology can be used to power the whole of Argentina. According to Cuthbertson (2021), analysis from the University of Cambridge shows that Bitcoin alone requires no less than121 terawatt-hours (TWh) per year to power all its networks.

Therefore, more need to be done on the risks which has been caused by introduction of cryptocurrency in the world. All key stakeholders need to take part in figuring out the most appropriate ways to methods to reduce the risks with cryptocurrencies.

Conclusion

Block chain has a large number of applications in almost every industry. Ledger technology can be used to track financial fraud, securely share medical records among health care professionals and even act as an effective means of tracking intellectual property in business and music rights for artists. While traditional banking systems has been there even before the introduction of cryptocurrencies can revolutionize the whole global financial industry as they are democratized and decentralized currencies that are not controlled by any government leader, nor subjected to sovereign borders or taxation control. It can be especially beneficial for nations like Africa, who do not have stable fiat currencies. Cryptocurrency allow the clients to send a secure and irreversible transaction that is fully traceable and transparent to the entire cryptocurrency network while significantly reducing the traditional financial settlement charges. Future business transactions will heavily rely on the upcoming methods of transferring currency from one form in the global economy. With all that said, cryptocurrency is a double edge sword. Measures will need to manage the down side like money laundering, terrorist financing, massive amount of energy consumption from mining activities. At the point of this writing, cryptocurrencies are highly unstable with high pricing volatility ranging from 10 to 50% daily, and very often manipulated or schemed by hedge funds or even by the creators themselves. Cryptocurrency’s future is very much uncertain at this point of time. Even while there are limitless potential and already proven strong application use cases where cryptocurrency is a viable and revolutionary option, much depends on individual governments’ willingness to embrace it, taking into account of its own sovereignty interest.

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