Assignment Description

The context in that you need to provide a piece of advice is digital payment. Nowadays, many companies struggle with the decision to adopt new forms of digital payment (e.g., cryptocurrency).

A Summary of Bitcoin

Cryptocurrency refers to digital currency with encryption techniques to regulate the generation of each currency unit and verify the transfer funds. A form of cryptocurrency is Bitcoin (a peer-to-peer electronic cash system), which was created in 2009. Bitcoin transactions are verified by each computer in the network and recorded in a blockchain. As the first decentralized digital currency, Bitcoin was also the most popular one. In the meantime, hundreds of cryptocurrencies, including Ethereum, Ripple, and Litcoin, also emerged.

As an exchange medium, Bitcoin reduced the cost of transactions. With a decentralized peer-to-peer network, transactions are conducted directly between two parties, verified across the network, and do not need a third party for clearing and settlement. The absence of intermediaries means that transaction costs can be kept to a minimum. Encryption algorithms are used to mask users’ identity in the Bitcoin blockchain, which, along with the feature of immutability, have made Bitcoin more robust against hackers’ attacks. The greater transparency and enhanced traceability of Bitcoin also result in better accountability, as transactions are effectively achieved across the network and leave a digital trail. Blockchain allows users to mask their identity with numeric identifiers (also known as Bitcoin addresses, akin to one’s email address). Users mostly remain anonymous during transactions, which helps to protect their privacy online. However, law enforcement agencies have the ability to trace Bitcoin transactions by matching the numeric identifiers with user information.    

Now, please read the following article to get more information about this consultation session and also different forms of digital payments:

Beyond Bitcoin: What Blockchain and Distributed Ledger Technologies Mean for Firms (This article is available in the Coursepack link).

Scenario

The company is a leader in supplying low-voltage cables, connectivity products, infrastructures, and accessories. The managers have a number of options to handle financial transactions with their suppliers, distributors, and customers. For instance, currently, they accept the following:

Credit and debit cards

Paypal

Google Wallet

Amazon payments

Apple pay

• Recently, their most profitable customers adopted Bitcoin, and they desired to pay in Bitcoin largely. The managers of the company are not aware of Bitcoin’s characteristics, advantages, and disadvantages. Moreover, the other main competitors have yet to use Bitcoin in their financial transactions. The managers invited two consulting companies first to understand what Bitcoin is and then decide whether to adopt it or not!
• (I chose consultant 2 for this paper for you to discuss)
• – Consultant 2 believes that Bitcoin is still in its infancy, other competitors have not used it, its transactions are still risky, and the public awareness about digital currency (e.g., Bitcoin) is very low. (consultant 2: Against Bitcoin)
• – Consultant 2 has to present some reasoning, facts, analysis, statistics, industry trends, and justification to convince the company to reject Bitcoin.
• What to include in your report

The font should be Times New Roman 12pt and double-spaced

Format

Introduction – offers a brief, clear explanation of the scenario and identifies which position/consulting team you chose (Consultant 2)

Body – describes the advantages and disadvantages of adopting or rejecting Bitcoin from the perspective of your chosen consulting team, presenting facts, analysis, statistics, and industry trends.

Conclusion (two paragraphs) – offers convincing reasoning and justification for the company to follow your recommendation regarding adopting or rejecting Bitcoin.