Respond to a group member that has an opposite view to yours and provide one specific insight that may help them come around to your view.
Classmate answers: (A is where we didn’t agree about the passing fad or future) I’ve attached my responses
a) Is cryptocurrency a passing fad or significant future trend?
Due to globalization and technology, no one can agree that cryptocurrency is a passing fashion. Most investors have money but lack time to train, and the best area to invest their resources is a digital currency. Since it has grown to the market share of one trillion dollars, it continually attracts new investors who are looking for a safe place to invest their resources. Additionally, the industry is attracting new technologies meaning it will be a great player in the futures economic and financial sector.
Currently, cryptocurrency has become a global phenomenon besides being a new invention. Most people are worried about its potential of interrupting traditional financial methods. Since cryptocurrency is less regulated with any governmental policies, the governments can later form laws that can interrupt its functions in specific locations. As, such some people consider it as trust less as all since the growing companies in the industry depend on the existing ones such as Bitcoin, which is located in China. Therefore, when the Government of China decides to impose additional regulation on Bitcoin, then the future of other companies may remain to be unknown.
b) Is bitcoin a currency?
Bitcoin is a currency because it allows buying and selling goods and services and exchanges to other currencies. On its own, it a digital currency, which can only be used on online platforms. It is a unique currency in that it can be transferred from one person to the next without a single administrator or a central bank.
c) Assume you are the CFO of a fortune 500 company. Would you hold any firm cash reserves in bitcoin?
As a CFO of a Fortune 500 Company, I would not like any firm cash reserve in bitcoin for many reasons. First, Bitcoin is not regulated by the government, therefore, it is prone to illegal transactions. Therefore, any country can shut down its application leading to serious losses of the involved companies. Criminals are working day in and out to get through their system, and many computer criminals have invested in the industry. According to Kethineni, Cao, and Dodge (2018), 21 million users use bitcoin for criminal acts and activities across the world. Thus, the company is at serious risk of hacking, fraud, and theft. As such, cash reserves in bitcoin for a firm can be lost anytime, which can result in volatility of bitcoin’s price, making my company realize losses.
d) If you were the CFO of a fortune 500 company would you accept bitcoin as payment?
As a CFO of a Fortune 500 company, I would accept bitcoin for payment. This is because bitcoin is a digital currency, which can be exchanged for other currencies. However, as the top decision-maker of my company, I will either exchange it with other currencies such as US dollars or Euros, or I will use it to buy other assets.
e) Assume you have opened a Coinbase account for your personal use. Which of the three leading digital currencies (Bitcoin, Ethereum and Litecoin) would you buy first? Why?
When I opened a Coin base, I will buy Bitcoin because it is the leading cryptocurrency digital currency. My company would allow people to sell and buy currencies without going to the bank. Due to that, Bitcoin already has a larger share of $62,000 and overs 43 users (Allyn, 2021). As the Bitcoin currency continues to go higher, it will be effective for me to build my Coin base. Additionally, Bitcoin will allow me to compete effectively with the existing players in the industry, such as Ethereum, Litecoin, and Ether since I will have a greater market share than them.