Bitcoin and Arrival of Cryptocurrencies (Beyond Bitcoin, Chapter 4)

Beyond Bitcoin: The Economics of Digital Currencies and Blockchain Technologies, 2nd ed, forthcoming

33 Pages Posted: 9 Mar 2018 Last revised: 3 Sep 2021

See all articles by Hanna Halaburda

Hanna Halaburda

New York University (NYU) - Leonard N. Stern School of Business

Miklos Sarvary

Columbia Business School - Marketing

Guillaume Haeringer

CUNY Baruch College

Date Written: May 28, 2021

Abstract

In this chapter, we discuss Bitcoin’s mechanism. 4.1. The double spending problem. 4.2. A brief overview of Bitcoin’s design. 4.3. Not the first one -- predecessors of Bitcoin. 4.4. New challenges created by Bitcoin design. 4.4.1. Mining arms race and electricity consumption. 4.4.2. Mining pools and centralization propensity. 4.4.3. Threat of attacks. 4.4.4. Deflationary pressure. 4.4.5. Governance. 4.5. How do Bitcoin’s attributes compare to earlier money?

For Chapter 1 (Introduction), see https://ssrn.com/abstract=3135021.
For Chapter 2 (Means of Exchange: Ever-present Competition), see https://ssrn.com/abstract=3135028.
For Chapter 3 (Platform-based Currencies), see https://ssrn.com/abstract=3135030.
For Chapter 4 (Bitcoin and Emergence of Cryptocurrencies), see https://ssrn.com/abstract=3135043.
For Chapter 5 (The Rich Land of Crypto), see https://ssrn.com/abstract=3135057.
For Chapter 6 (Smart Contracts and Blockchain), see https://ssrn.com/abstract=3894110.
For Chapter 7 (Enterprise Blockchains), see https://ssrn.com/abstract=3894117.
For Chapter 8 (Conclusions: Future Full of Possibilities), see https://ssrn.com/abstract=3894118.

Keywords: Bitcoin, digital currencies, network effects, cryptocurrencies

JEL Classification: D8, E4, G2, O3, D83, D84, E42, G21, G23, O33

Suggested Citation

Halaburda, Hanna and Sarvary, Miklos and Haeringer, Guillaume, Bitcoin and Arrival of Cryptocurrencies (Beyond Bitcoin, Chapter 4) (May 28, 2021). Beyond Bitcoin: The Economics of Digital Currencies and Blockchain Technologies, 2nd ed, forthcoming, Available at SSRN: https://ssrn.com/abstract=3135043

Hanna Halaburda (Contact Author)

New York University (NYU) - Leonard N. Stern School of Business ( email )

44 West 4th Street
New York, NY NY 10012
United States

Miklos Sarvary

Columbia Business School - Marketing ( email )

New York, NY 10027
United States

Guillaume Haeringer

CUNY Baruch College ( email )

17 Lexington Avenue
New York, NY 10021
United States

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