Analysis of cryptocurrency’s characteristics in four perspectives

Abstract

Purpose -The innovation of cryptography technique and blockchain has made cryptocurrency an alternative medium of exchange due to its safety, transparency and cost effectiveness. But its main feature cannot be separated from the users who use cryptocurrency for their illegal transactions. There are several arguments related to the legality of cryptocurrency. The purpose of this paper is to analyze the nature of cryptocurrency based on characteristics of money, legal perspective, economic perspective and Sharia perspective. Design/methodology/approach -In this study, the methodology used is descriptive with a qualitative approach. The object of this research is cryptocurrency. The data are secondary data obtained from peer-reviewed journal articles, conference papers review, working paper and Sharia consultant reports addressing the legality of cryptocurrency. The literature review analysis includes the following steps: material collection, descriptive analysis, discussion with people in Sharia competency and intuitive-subjective material evaluation. Findings -Regarding the characteristic of money, cryptocurrency is acceptable. But in terms of the legal perspectives, cryptocurrency does not meet the criteria as currency. From the economic perspective, cryptocurrency does not fully meet the characteristic currency due to high price volatility, and from the Sharia perspective, cryptocurrency can be considered property (mal) but not as a monetary value (thamanniyah).

Digital Currency Perception: Preliminary Evidence From Malaysia

“…Because the mining processes and transactions are not completely secured, it may cause colluding users to take advantage of these defects process to perform unethical activities (Clare & Ben, 2015), for example services that provide customers with facilities for online digital wallets may be targeted by hackers. Users of digital currency may exploit its feature for illegal activities (Yuneline, 2019).…”

“…Hence, its users need to look at to which extent that the digital currency program can be developed to handle a greater number of transactions (Clare & Ben, 2015). Digital currencies suffer from financial stability risk because it is not guaranteed with any assets, and there is also a lack of consumer protection because there is no regulatory authorities backing it (Yuneline, 2019). Table 4 presents the effective actions taken to stop terrorism financing to protect the integrity of financial structure and increase transparency of digital currencies dealings (Bank Negara Malaysia, 2018).…”

Time-Varying Nexus between Investor Sentiment and Cryptocurrency Market: New Insights from a Wavelet Coherence Framework

“…Strong coherencies between the corresponding variables, where the Sentix index is driven, are mostly localized at the middle and low frequencies, indicating that there is a long-term relationship between Bitcoin and the investor sentiment index. The main feature of Bitcoin is that it is considered an asset rather than a virtual currency (Yuneline 2019). Created in 2009, Bitcoin is the most widely used currency with the highest market capitalization value as well as the number of daily transactions.…”

“…According to this author, it is worth indicating that three combined characteristics can be attributed to CC; we recognize anonymity, independency of central authority and protection from double-spending assault. Likewise, Yuneline (2019) qualitatively investigated the nature of CC based on four characteristics sentiment and events effect on CC market efficiency. The authors revealed that news-based sentiment may not be a significant predictor to predict CC market efficiency.…”

Linearity extensions of the market model: a case of the top 10 cryptocurrency prices during the pre-COVID-19 and COVID-19 periods

“…Nakamoto ( 2008 ) was the first to document Bitcoin as the most well-known and prominent decentralized digital cryptocurrency based on blockchain technology. Bitcoin currently has the largest market capitalization among cryptocurrencies and has been widely used as a means of electronic payment in recent years due to the anonymity, safety, transparency, and cost effectiveness that it offers (Yermack 2013 ; Kim 2017 ; Yuneline 2019 ). The increasing popularity of Bitcoin has led researchers to develop other digital cryptocurrencies, such as Ethereum, XRP, and CRO.…”