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Finance - Final Project

The document is a report submitted by Aneeqa Dar and Hassaan Rasool to Nizam Feroze on Bitcoin for a final project on Introduction to Business Finance. It summarizes that Bitcoin is a decentralized digital currency created in 2008 by an unknown person under the name Satoshi Nakamoto. Bitcoins exist online and are divisible up to 8 decimal places. Transactions are recorded on a peer-to-peer network with no central authority. While Bitcoin currently has a small impact on the US economy, its growing market cap and increasing regulation mean it could significantly influence global finance in the future.

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Aneeqa dar
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148 views4 pages

Finance - Final Project

The document is a report submitted by Aneeqa Dar and Hassaan Rasool to Nizam Feroze on Bitcoin for a final project on Introduction to Business Finance. It summarizes that Bitcoin is a decentralized digital currency created in 2008 by an unknown person under the name Satoshi Nakamoto. Bitcoins exist online and are divisible up to 8 decimal places. Transactions are recorded on a peer-to-peer network with no central authority. While Bitcoin currently has a small impact on the US economy, its growing market cap and increasing regulation mean it could significantly influence global finance in the future.

Uploaded by

Aneeqa dar
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Submitted to:

Nizam Feroze

Submitted by:

Aneeqa Dar ( L1f15BBAM0403 )

Hassaan Rasool ( L1F15BBAM04 )

Final Project

Introduction to Business Finance

Section – E

UNIVERSITY OF CENTRAL PUNJAB Page 1


Bitcoin

What is Bitcoin?
Bitcoin is a decentralized digital currency. Decentralized means not produced by any
government. Digital means it exists online only. As a currency, it can be used a medium of
exchange for buying goods and services, the same way you do it with dollars.

Bitcoins are the unit of currency of the bitcoin system. In the United States, we have a
dollar ( symbol $ ). The dollar is divisible to two decimal points — or $1.00. Bitcoins, on the
other hand, are referred to as BTC, and the currency is divisible to eight decimal places; so
0.00000001 BTC is the least denomination that can be used in a transaction. Bitcoins are like an
electronic form of cash. It is an innovative payment network and a latest form of money.

It uses P2P network to operate with no central authority or banks; controlling transactions
and the issuing of bitcoins is carried out collectively by the network.  Through many of its
distinguishing properties, Bitcoin allows pretty exciting uses that cannot be covered by any
earlier payment method.Using Bitcoin to pay and get paid is simple and accessible to everyone.
It makes the Bitcoin network, a financial network or the “ Internet for Money”.

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money/

Who created Bitcoin?


In 2008, bitcoin was developed by software programmers, using the pseudonym “Satoshi
Nakamoto.” The actual identity of the creator is unknown. Newsweek said it recognized the
creator, but he has strongly denied the allegation. The first 50 bitcoins were issued on Jan. 3,
2009. Bitcoin is a digital currency, created online, through a process called “mining.” Imagine
the process of gold mining: we dig a hole in the ground looking for the metal. Similarly, Satoshi
Nakamoto hid bitcoins on the Internet; one can find them by writing an algorithm that solves a
certain mathematical problem. They are created by the transactions between the buyers and the
sellers. Each transaction has to be approved by the “Miner”.

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https://www.slideshare.net/dcarro11/bitcoin-powerpoint

UNIVERSITY OF CENTRAL PUNJAB Page 2


How does Bitcoin work?
. Bitcoin is cost effective and flexible and perhaps the best thing about bitcoin is that the
payor (the one sending the funds) can voluntarily set the transaction fee and can also decide to
have no fee at all.

One can start working with Bitcoin without understanding all the technical details. Once
you have installed a Bitcoin wallet on your computer or smartphone, it will create your first
Bitcoin address and you can generate more whenever you want one. You can share your
addresses with your friends so that they can pay you or vice versa. In fact, this is quite similar to
how email works, except for that Bitcoin addresses should only be used once.

Transaction has to be approved by the “miner” and once confirmed transactions are
included in the block chain. In this way, Bitcoin wallets can compute their balances and new
transactions can be verified as bitcoins that are actually owned by the payer. Mining is a
technique used to approve the waiting transactions by inserting them in the block chain.

https://bitcoin.org/en/how-it-works

https://www.slideshare.net/dcarro11/bitcoin-powerpoint

Impact of Bitcoin on US Financial System


The USA economy plays a major role in the global financial world. In spite of Bitcoin
transactions making up only the smallest proportion of the US economy, the potential of the
cryptocurrency growing should not be understated. As a rising digital asset with a market cap of
around $4,150,000,000, Bitcoin is so far making a massive impact on global finance but there are
a number of exciting developments to oversee the upcoming months and years.

Bitcoin was conceptually unique when it first emerged as a digital asset. There are a
number of services training the less technical skilled users, thus trying to bring Bitcoin and its
technology into a position developed for greater usage. The comparatively minute size of the
present Bitcoin market limits the influence it can have on the huge economy in the USA.
However, the introduction of the Bitlicense regulatory structure in New York is an obvious
indicator that Bitcoin is now firmly on the radar. Regulation is expected to be a hot topic over the
upcoming years, so the Bitcoin community must remain firm with those that desire to regulate
the industry. It will be exciting to see how approaches vary between the UK and US; last year
UK Chancellor George Osbourne expressed an obvious interest in “digital currencies” and the

UNIVERSITY OF CENTRAL PUNJAB Page 3


Bank of England noted its desires to explore blockchain technology, but we are yet to see any
obvious regulatory decisions from the British powers that be.

Within the US, Bitcoin-centric trade activities seem to be focused in California, New
York and, to a minor level Texas. The “Silicon Valley” has seen an unpredictable flow of
awareness towards cryptocurrency and blockchain technology.

http://www.financemagnates.com/cryptocurrency/bloggers/how-bitcoin-
influences-the-us-economy/

UNIVERSITY OF CENTRAL PUNJAB Page 4

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