Sample Economics Case Study on Monetary Policy

Cryptocurrency is a digital currency created and managed through Blockchains involving a technique called cryptography. The creation of Bitcoin, in 2009, captured the attention of investors and established cryptocurrency as one of new currencies. Cryptocurrency will not be widely accepted in the future because of insecurity, unreliability, strict regulation by governments and promotion of illegal practices.

This day, cryptocurrencies are encountering criticisms about how a person’s wealth can be erased easily by a computer failure. When a computer fails there is likelihood of data loss.  Per Xin & Chong (2017), the ledger containing transactions is available to anyone within the network, meaning that people can view account balances for every participant. Regrettably, technological advances and increased knowledge by hackers will jeopardize the security of transactions. In light of the limitation, I believe cryptocurrencies will closely be monitored and regulated by different government agencies in the future. The close scrutiny will erode the freedom, authority and control participants in the Blockchain currently have (Salami, 2019).  In this manner, the intended regulation essentially erodes the key reason for the existence of cryptocurrencies.

The relative complexity associated with cryptocurrencies is likely to hinder its wide acceptability by consumers who are not technology savvy. Hayes (2017) asserts that usage of cryptocurrencies is common among merchants. In my view, merchants seem to be the minority users compared to ordinary consumers. I feel many people may not accept its usage considering that conventional currencies are easy to use. Further, I predict that cryptocurrency may be widely unaccepted because the decentralization revealed by New York Times (2018) may not safeguard and protect its users. The anonymous usage by participants is an avenue I believe will be used by merchants and businesses to steal data, evade tax and promote money laundering activities.

The possibility of widespread use of cryptocurrencies like Bitcoin in the future looks remote. A cryptocurrency aspiring to be mainstream in future must fulfill diverse criteria. These criteria include guarantee security of funds, enhance tax compliance and suppress illegal practices like money laundering.


Hayes, A. (2017). Cryptocurrency value formation: An empirical study leading to a cost of production model for valuing Bitcoin. Telematics and Informatics, 34(7), 1308-1321.

New York Times. (2018, April 2). How cryptocurrency works. YouTube. Retrieved from

Salami, I. (2019). Cryptocurrencies are finally going mainstream – the battle is on to bring them under global control. The Conversation. Retrieved from

Xin, L. & Chong, A. (2017). The technology and economic determinants of cryptocurrency exchange rates: The case of Bitcoin. Decision Support Systems, 95, 49-60.