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    This document discusses cryptocurrency and its economics and impact. It begins with key terminology used in cryptocurrency. It then provides background on the development of cryptocurrency and analyzes the cryptocurrency market structure, which has transitioned from a monopoly to a more oligopolistic structure. The document also analyzes the supply and demand dynamics of Bitcoin and discusses the short-run and long-run supply and demand factors. Finally, it outlines some of the positive impacts of cryptocurrency as well as some potential negative consequences if the cryptocurrency market were to crash.

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    This document discusses cryptocurrency and its economics and impact. It begins with key terminology used in cryptocurrency. It then provides background on the development of cryptocurrency and analyzes the cryptocurrency market structure, which has transitioned from a monopoly to a more oligopolistic structure. The document also analyzes the supply and demand dynamics of Bitcoin and discusses the short-run and long-run supply and demand factors. Finally, it outlines some of the positive impacts of cryptocurrency as well as some potential negative consequences if the cryptocurrency market were to crash.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as pptx, pdf, or txt
    11 views13 pages

    The Economics and Impact of Cryptocurrency: Ally Dunn

    Uploaded by

    ally
    This document discusses cryptocurrency and its economics and impact. It begins with key terminology used in cryptocurrency. It then provides background on the development of cryptocurrency and analyzes the cryptocurrency market structure, which has transitioned from a monopoly to a more oligopolistic structure. The document also analyzes the supply and demand dynamics of Bitcoin and discusses the short-run and long-run supply and demand factors. Finally, it outlines some of the positive impacts of cryptocurrency as well as some potential negative consequences if the cryptocurrency market were to crash.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
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    Download as pptx, pdf, or txt
    of 13

    THE ECONOMICS

    AND IMPACT OF
    CRYPTOCURRENCY
    Ally Dunn
    The
    Blockchain The longest
    • Transaction chain rule
    ledger

    KEY
    TERMINOLOGY
    Non-
    fungible Miners
    tokens
    BACKGROUND OF
    CRYPTOCURRENCY
    THE CRYPTOCURRENCY MARKET

    Monopoly

    Oligopoly
    Major Cryptocurrencies by Share of Market
    MONOPOLY
    9%

    6%

    Single “seller”

    No Substitutes

    86%

    Bitcoin XRP Other


    Barriers to entry

    8/1/2015
    OLIGOPOLY
    Major Cryptocurrencies by Share of Market
    1%
    Few sellers

    33%
    Similar or identical products
    47%

    Interdependent

    19%

    Bitcoin Etherium Other XRP

    8/1/2021
    SUPPLY AND
    DEMAND: BITCOIN
    $P S

    Q
    SHORT-RUN SUPPLY

    17 MILLION TOKENS MINERS DETERMINE SHORT RUN INCENTIVES


    SHORT RUN SUPPLY & GAME THEORY
    LONG-RUN SUPPLY

    Fixed Supply 22 million tokens Perfectly Inelastic Decentralized nature


    Impossible to manipulate supply
    Elastic

    Changes with new


    information
    SHORT-RUN
    DEMAND Volatility

    Speculation
    LONG RUN DEMAND

    UNPREDICTABL EXPECTATIONS HIGH UTILITY MEDIUM OF


    E EXCHANGE
    POSITIVE IMPACTS OF
    CRYPTOCURRENCY ON THE ECONOMY

    Opportunities for financial success

    Competition

    Innovation

    Potential redistribution of wealth


    NEGATIVE IMPACTS & POTENTIAL
    CONSEQUENCES IF THE CRYPTO-MARKET
    CRASHES

    Increases in structural unemployment

    Decreases in wealth

    Consumption and Savings/Investment go down

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