This week we discussed Bitcoin Economics.  For this week’s research paper, you need to search the Internet and explain why some businesses are accepting and other businesses are rejecting the use of Bitcoins as a standard form of currency.  Your paper needs to identify two major companies that have adopted Bitcoin technology. Your paper should meet the following requirements: • Be approximately 3-5 pages in length, not including the required cover page and reference page. • Follow APA guidelines. Your paper should include an introduction, a body with fully developed content, and a conclusion. • Support your response with the readings from the course and at least five peer-reviewed articles or scholarly journals to support your positions, claims, and observations.  The UC Library is a great place to find resources. • Be clear with well-written, concise, using excellent grammar and style techniques. You are being graded in part on the quality of your writing. Purchase the answer to view it

Title: Adoption and Rejection of Bitcoin as a Standard Form of Currency by Businesses

Introduction:

Bitcoin is a decentralized digital currency that operates on the principles of cryptography, enabling peer-to-peer transactions without the involvement of a central authority. Its introduction in 2009 paved the way for a new era of financial technology, sparking debates about its viability as a standard form of currency for businesses. This research paper aims to explore the reasons behind businesses’ acceptance or rejection of Bitcoin and identify two major companies that have adopted Bitcoin technology. By examining these case studies, we can gain insights into the benefits and challenges associated with adopting Bitcoin as a means of payment.

Adoption of Bitcoin by Businesses:

Several businesses have embraced the use of Bitcoin as a standard form of currency due to the unique advantages it offers. One of the primary reasons for its adoption is the potential for reduced transaction costs. Traditional payment methods involve various intermediaries, such as banks and payment processors, which impose fees. Bitcoin transactions, on the other hand, eliminate the need for these intermediaries, resulting in lower costs.

Furthermore, Bitcoin provides businesses with global accessibility and enables cross-border transactions without the complexities associated with traditional currencies. It offers a seamless and efficient method of transferring funds, particularly in regions where traditional banking systems are inaccessible or unreliable.

Another significant aspect contributing to the adoption of Bitcoin is the transparency and security it offers. Blockchain technology, the underlying infrastructure of Bitcoin, provides an immutable ledger that records all transactions. This transparency enhances trust between businesses and customers, reducing the risk of fraud. Additionally, the cryptographic protocols used in Bitcoin ensure secure and tamper-proof transactions, making it an attractive alternative to traditional payment systems.

Case Study 1: Overstock.com

Overstock.com, an American online retailer specializing in furniture, bedding, and home decor, became one of the early adopters of Bitcoin. By implementing Bitcoin as a payment method, Overstock aimed to cater to tech-savvy customers and expand its customer base. The company cited reasons such as reduced transaction costs, higher payment security, and the ability to reach a global customer base as drivers for its adoption of Bitcoin.

Case Study 2: Microsoft

Microsoft, a multinational technology corporation, began accepting Bitcoin for select digital products and services in 2014. The company’s decision to adopt Bitcoin was driven by the desire to offer more flexible payment options to its customers. Moreover, Microsoft recognized the potential of Bitcoin to streamline micropayments and enable seamless international transactions.

Rejection of Bitcoin by Businesses:

Despite the benefits offered by Bitcoin, several businesses have chosen not to adopt it as a standard form of currency. One primary concern is the price volatility of Bitcoin. The cryptocurrency market is known for its significant fluctuations, which can create uncertainty for businesses’ revenues and profitability. This unpredictability makes it challenging for businesses to set prices and manage cash flows effectively.

Moreover, businesses operating within highly regulated industries may face hurdles in adopting Bitcoin due to legal and regulatory uncertainties. Governments worldwide are still grappling with the regulatory frameworks surrounding cryptocurrencies, which gives rise to compliance risks for businesses. The potential for money laundering and illicit activities associated with Bitcoin can lead to reputational damage, legal liabilities, and increased scrutiny from regulatory bodies.

Case Study 1: Amazon

Despite being a leading e-commerce giant, Amazon has not adopted Bitcoin as a payment option. The reasons behind this rejection stem from concerns around price volatility and regulatory uncertainties. Amazon’s cautious approach towards Bitcoin may be attributed to the need to align with regulatory frameworks and maintain a stable pricing structure.

Case Study 2: Walmart

Walmart, one of the world’s largest retailers, has also refrained from embracing Bitcoin. The company’s decision is likely influenced by similar concerns regarding price volatility, regulatory compliance, and risk mitigation. As a multinational corporation operating in various jurisdictions, Walmart must navigate complex legal and regulatory landscapes, which may deter its adoption of Bitcoin.

Conclusion:

In conclusion, the acceptance or rejection of Bitcoin as a standard form of currency by businesses depends on numerous factors, including the potential benefits and challenges it presents. While businesses like Overstock.com and Microsoft have embraced the cryptocurrency, others like Amazon and Walmart have chosen not to adopt it. The adoption of Bitcoin is driven by factors such as reduced transaction costs, global accessibility, enhanced security, and transparency. However, concerns around price volatility and regulatory uncertainties act as deterrents for some businesses. As the cryptocurrency landscape evolves and regulatory frameworks mature, businesses will continue to evaluate the potential of Bitcoin and other cryptocurrencies as viable payment options.