ABSTRACT The document consist of detail study of Bitcoin’s marketing strategy which states the complete market summary of Bitcoin and ultimately helps
it to get recognized and legitimized by the central bank
BITCOINS MARKETING
Created By: Abhishek Kumar Singh Abhishek Singh Akshaya Bhardwaj
STRATEGY To get legitimized by Central Banks
Harsh Vardhan Shilpi Goyal Sravan Kumar
Contents
2.1.
Market Summary: ............................................................................................................................................................. 2
2.2.
SWOT Analysis .................................................................................................................................................................. 4
2.3.
Competition Analysis: ...................... .................................. ....................... ...................... ...................... ...................... ...................... ...................... ...................... ...................... ...................... ...................... .................. ....... 7
2.4.
Product/ Service offering ..................... ................................ ...................... ...................... ....................... ....................... ...................... ...................... ...................... ...................... ...................... ...................... .............. ... 8
3.1.
Mission: ............................................................................................................................................................................ 8
3.2.
Marketing objectives: ...................... .................................. ....................... ...................... ...................... ...................... ...................... ...................... ...................... ...................... ...................... ...................... .................. ....... 8
3.3.
Financial objectives:...................... ................................. ...................... ...................... ...................... ...................... ...................... ...................... ...................... ...................... ....................... ....................... ................... ........ 10
3.4.
STP .................................................................................................................................................................................. 10
3.5.
Product/ Service Mix ..................... ................................. ....................... ...................... ...................... ...................... ...................... ...................... ...................... ...................... ....................... ....................... ................. ...... 14
3.6.
Marketing research ......................................................................................................................................................... 15
4.1.
Investment and Sales forecast ..................... ................................ ...................... ...................... ...................... ...................... ...................... ...................... ...................... ...................... ...................... ................ ..... 16
4.2.
Expenditure forecast...................... .................................. ....................... ...................... ...................... ...................... ...................... ...................... ...................... ...................... ....................... ....................... ................. ...... 18
4.3.
Break even analysis................. analysis............................ ....................... ....................... ...................... ...................... ...................... ...................... ...................... ...................... ...................... ...................... ...................... .............. ... 18
4.4.
Linking expenses to strategy & tactics ...................... ................................. ...................... ...................... ...................... ...................... ...................... ...................... ...................... ...................... .............. ... 18
5.1.
Implementation .............................................................................................................................................................. 20
5.2.
Contingency Planning ...................... .................................. ....................... ...................... ...................... ...................... ...................... ...................... ...................... ...................... ...................... ...................... ................ ..... 20
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1. Executive summary In less than a decade, bitcoin has gone from being a doubtful interest to a household name. Its value has risen with ups and downs from a few cents per coin to over $4,000. In this report we are focusing on marketing strategies of the bitcoin and how it can be positioned in the market to make it legitimized from the central bank worldwide. Global central banks must think seriously about their approach to the growing cryptocurrency markets. In a World Economic Forum report released in September, states that by the year 2025, 10% of global gross domestic product will be stored on block chain technology. However, the current market capitalization of Bitcoin is around $6 billion as of press time, 0.008% of global GDP of $78 trillion.
2. Situation analysis The current market capitalization of Bitcoin is around $6 billion which is 0.008% of global GDP of $78 trillion and it is widely expected to grow in the coming years. Awareness and interest in Bitcoin, and in particular Block chain, is undergoing fish market. In the global scheme, it is a technology that is still new. Currently bitcoin transactions per day on average 300,000 transactions. When compared with Visa. Visa transactions reached approximately 150,000 transactions per day. This suggests the adoption of digital currency more widely and can be used as money in the future, thus, marketing efforts and education is very important for the progress of digital currency. Efforts made bitcoin companies like Decentralized Marketing Network is working to raise awareness of Bitcoin and technology Block chain. Traditional currencies are managed by the central bank, while bitcoins are not regulated by any authority; instead, they are maintained by an online community. Since bitcoin is not a country specific currency, international payments can be carried out more efficiently & economically. Bitcoins can be transferred digitally among people using mobile apps on smartphones or computers. Bitcoins are stored in a digital wallet that may exist on cloud or physical storage.
2.1. Market Summary: Before starting out with planning we have conducted marketing campaign where we need to understand who will be our target audience. In broad-spectrum we like to split Bitcoin prospects into 2 major groups: Newbie and Savvy. The Newbies require a diverse approach than the Savvies as they need more clarifications and they speak a different language. Depending on the business people need to first decide who will be their primary target audience is. 2
Target market: Bitcoin is a universal currency, so the target audience is not only one group or type of
person. But the primary mainstream users would be people who value privacy, globalization, and decentralization. It started out being popular with libertarian and rebel types but has expanded to a more diverse audience as more people get interested in it, and it becomes easier to use. Following are the list of target consumer:
a) Casino b) Business c) Tourists d) Regulators e) Investors f) Merchants g) Miners h) University Students Geography: Bitcoin was developed in the United
States and gained pervasive currency in North America. About 53% of Bitcoin players live in Canada and the USA, nearly 30% of players are from Israel and the lasting 20% are from European countries and other Asian, Africa, South America. Thus, Bitcoin is virtual currency of the Western countries along with the most highly developed countries.
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Demographics Age Group:
The average user is a 32.7 year old libertarian male.
Top motivators for new users are curiosity, profit, and politics.
Bitcointalk.org is the dominant community platform.
Far more people have used Bitcoin to make donations than to buy narcotics.
39% of users do not drink, smoke, gamble, or take drugs.
Market Growth: Bitcoin’s user base has grown from 120,000 users in 2013 to 6.5 mln users in four
years. 2017 is not over yet and the number might soar even higher. One of the most optimistic predictions is that by 2030, Bitcoin’s price will reach $500,000 and, judging by past levels of growth, the number of users can increase to 400 million.
2.2.SWOT Analysis Strengths:
The Bitcoin market has risen a long way since it’s windy but then dramatic rise in 2013, where it peaked at $266 in Q2 and then hit its all-time highest price of $1242 in Q4 before making its descent to the $400 range. The Bitcoin Volatility Index depicts the downward trend that should inspire confidence in Bitcoin as a currency. While the price has stabilized, the network security continues to improve by professional mining operations across the globe. Currently Bitcoin transactions are secured by a staggering 1.4 billion giga hash per second and this continues to grow at an exponential rate as can been seen below. This makes Bitcoin by far the largest and most secure production blockchain in the world. By comparison with Ethereum only has 2000 giga hash per second securing Ether transactions. This market maturity extends to the amount and variety of services that we are seeing developed as well as the overall Bitcoin adoption. On average there are about 200.000 transactions on the Bitcoin blockchain every day and the numbers of wallet users now exceeds 6.75 million users on Blockchain alone where 4
the total users is estimated to be in the excess of 10 million users. All the data confirms that the overall adoption is growing at an exponential rate and that the future of cryptocurrencies looks bright. However, there are obstacles in Bitcoin’s way threatening its pole position.
Weaknesses:
Bitcoin was designed as a digital cash system. As such it has limitations that other cryptocurrencies, so-called altcoins, identified as market opportunities. In light of Bitcoin’s scalability issues (more about that below) the altcoin market took off where the total market capitalization now sits at $1.34B compared to Bitcoin’s $6.55B capturing 16.96% of the total cryptocurrency market. The growth of the altcoin market was led by Ethereum, a smart contract platform that uses its cryptocurrency Ether as tokens on their block chain to enable smart contracts. And although Ether has not been introduced as a cryptocurrency per se, it has the same capabilities as Bitcoin with some different characteristics: a different inflation rate, a different confirmation time per block, an anticipated different security model called Proof-of-Stake and a different governance model to name a few. With Ethereum reaching a $1B market capitalization in March it became a contender for Bitcoin’s pole position that Bitcoin has maintained since its genesis block was solved in 2009. Bitcoin has become too popular. Its blocks that make up the block chain and that contain the transactions are becoming full. The recent price surge of Ethers could be an indication that this is already happening. To solve this issue there are different proposals, some more elegant than others.
Opportunities
Cryptocurrencies are in a great macroeconomic spot. Statements from central banks and regulators serve as catalysts for adoption and we are clearly seeing a shift in attitude from the financial institutions. As a prime example of this Barclays announced that it accepted Bitcoin Company Circle last week as a customer. This is after the FCA in the UK granted the company an e-money license, which on itself is a major breakthrough. This marks the first time a tier 1 bank opens accounts for a Bitcoin business. The other side of the opportunity lies in block chain technology. Much has been said, little has been done. Most of the projects revolve around experimentations and small scale proof-of-concepts. There is however a world of possibilities when it comes to block chain technology and we are only scratching the surface of its long term implications on industries, governments and society as a whole.
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Threats
As far as threats go between Bitcoin and the altcoin market, we see Bitcoin’s resilience in companies emulating the early success of some of the proposed innovations by altcoins. As an example, where Ethereum is creating a dedicated smart contract platform, Bitcoin Company Rootstock is attempting to do the same on the Bitcoin block chain. Where scalability is an issue, Bitcoin Company Block stream proposes sidechain technology to scale Bitcoin’s block chain. Where instant transactions are impossible, we see the introduction of services like Bitgo Instant taking the clearing risk. Long term it remains to be seen whether the market gravitates towards the security of Bitcoin’s block chain with these technology solutions or whether altcoins will fill these gaps. So far the network effect favored Bitcoin, going forward this may change. Regardless Bitcoin will likely continue to serve as a store of value digital gold, even if more advanced cryptocurrencies and block chain use cases move elsewhere. And as we are seeing with the emergency of services like Shapeshift.io, interoperability will be key for any of them to be successful. To the cryptocurrency market as a whole there are mostly regulatory threats. Just like the Internet is censored in parts of the world, cryptocurrencies will face regulatory pressure there where they threaten local currencies and governments. This is not to say that they can be stopped or controlled, it’s more to say that the interactions between cryptocurrencies and the fiat currencies could be throttled to extent that it renders them useless. On the positive, the global regulatory landscape views Bitcoin favorably with only four countries outright banning cryptocurrencies. And a parallel economy may remove the reliance on the fiat currency economy altogether if the network growth persists. In Europe specifically the European Commission has already expressed the need to apply AML legislation to cryptocurrency businesses.
As for block chain, it’s currently on top of the Hype Cycle where too few use cases are going into production. This potentially emulates the early days of the renewable energy sector where significant funding and government grants were spent prematurely. Or it could remind us of the Internet bubble where an abundance in funding lead to businesses that scaled too early, were ahead of what the technology could deliver or had no valid business case at all. For block chain this may cause delay for wider implementation and it could hurt those businesses that are requiring growth now, having raised significant sums of funding too early. At the same time we are seeing a booming Fintech sector that is putting pressure on the financial industry to innovate aggressively where block chain is part of their agenda to turn the tide. 6
2.3.Competition Analysis: Bitcoin has four major following competitors:
Ethereum (ETH): Launched was in 2015, Ethereum is a decentralized software platform that
provide Distributed Applications to be built and run without any downtime, fraud, control or interference from a third party. During 2014, Ethereum had launched a pre-sale for ether which had received an overwhelming response. The applications on Ethereum are run on its platformspecific cryptographic token, ether. Bitcoin and Ethereum are not much different substantially in purpose and capability. The Bitcoin blockchain is used to track ownership of digital currency (bitcoins), the Ethereum blockchain focuses on running the programming code of any decentralized application. Ethereum is second cryptocurrency which is running world wide and litecoin working on the negative side ie launched with $50 and now at the current price is $48.
Litecoin: It was launched in the year 2011, was among the initial cryptocurrencies following
bitcoin and was often referred to as ‘silver to Bitcoin’s gold.’ It is based on an open source global payment network that is not controlled by any central authority and uses "script" as a proof of work, which can be decoded with the help of CPUs of consumer grade. Although Litecoin is like Bitcoin in many ways, it has a faster block generation rate and hence offers a faster transaction confirmation. Other than developers, there are a growing number of merchants who accept Litecoin.
Zcash: It is a decentralized and open-source cryptocurrency launched was in the 2016, looks
promising. “If Bitcoin is like http for money, Zcash is https," is how Zcash defines itself. Zcash offers privacy and selective transparency of transactions. Thus, like https, Zcash claims to provide extra security or privacy where all transactions are recorded and published on a blockchain, but details such as the sender, recipient, and amount remain private. Zcash offers its users the choice of ‘shielded’ transactions, which allow for content to be encrypted using advanced cryptographic technique or zero-knowledge proof construction called a zk-SNARK developed by its team.
Dash: Originally known as Darkcoin, it is a more secretive version of Bitcoin. Dash offers more
anonymity as it works on a decentralized mastercode network that makes transactions almost 7
untraceably. Launched in January 2014, Dash experienced an increasing fan following in a short span of time. This cryptocurrency was created and developed by Evan Duffield In March 2015, ‘Darkcoin’ was rebranded to Dash, which stands for Digital Cash and operates under the ticker – DASH. The rebranding didn't change any of its technological features such as Darksend, InstantX.
2.4.Product/ Service offering
Bitcoin has launched the Asset management service with the Swiss bank FALCON Group. As a client of Bitcoin they are also going to open the ATM for the Bitcoin members. This has been declared in July 2017.
Wallet service has been launched by LUNO for the Bitcoin in Singapore as they are targeting to raise $9m from it. They are planning to launch this service to the 35 countries in Europe and after that they are targeting to double in three years.
Bitcoin is also giving Bitpay this card is accepted worldwide by this card any one can make or receive the payments. That card is easily can be used anywhere in retail stores, Bill Payments and for donations. By this Bitpay any one can convert the Bitcoins into dollars very easily. Bitpay also going to start its payment wallet.
Payza also a payment gateway now accepting the Bitcoins for the payment, they have made their decision as they are now moving towards crypto currency. Payza serves 13 million customers over 190 countries. Their main objective is to provide secure payment of crypto currencies over the internet.
3. Marketing Strategy 3.1.Mission: The Bitcoin Foundation co-ordinates the efforts of the members in the Bitcoin community, helping to create awareness of the benefits of Bitcoin, how to use it and its related technology requirements, for technologists, regulators, the media and everyone globally.
3.2.Marketing objectives: The promotion strategy of a Bitcoin company comes with some degree of responsibility for educating the entire market. This poses both a challenge and opportunity to associate one’s brand with the entire 8
market. For instance, a company that is focused around Bitcoin ATM machines may need a promotional strategy that educates the market around the specific brand of machines that they provide. Currently Bitcoin transactions per day on average are 300,000 transactions. When compared with Visa, this figure is higher than Visa transaction per day. Visa transactions reached approximately 150,000 transactions per day. This suggests the adoption of digital currency more widely and can be used as money in the future, thus, marketing efforts and education is very important for the progress of digital currency. Efforts made by Bitcoin companies like Decentralized Marketing Network is working to raise awareness of Bitcoin.
CEO Genitrust, who heads the trade crypto-currency peer-to-peer platform Wall of Coin, the marketing objective, is essential for building trust.
Robert Genito said that the marketing strategy is important to get the image of the public trust in the service.
Amanda B. Johnson, pant from Dash video views, with full operation explained that the goal of a strong marketing more than selling a service rather educate potential users.
Amanda B. Johnson educate about the benefits of the Dash. In addition, to explain why the excess so that it can continue to exist and how the number of competitors is increasing. If all this was done in a friendly and easy to understand, people really appreciate that you have done so much work for them. It provides links to resources to learn more about and you can provide a valuable service to busy people.
“While efficient marketing objectives pioneered by companies or people behind the technology can help educate and convince new users, word of mouth marketing can distinguish between artificial and technological sensation solid truth. According to Rijk Plasman, founder of the digital currency is based in the Netherlands Gulden; the most effective marketing is the direct experience of satisfied customers. The only marketing strategies that work at this stage is from word of mouth marketing for digital currency is not easy to use, but it comes with a challenge. So you want to be notified about digital currency by someone you trust. " According Genito, cooperation and collaboration is a component that is lacking in the world cryptocurrency, and that the focus on working together and not in conflict, will solve many of the problems the larger field.
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3.3.Financial objectives: The financial modelling associated with the Bitcoin industry depends in part on the external market adoption rates and saturation levels. Unlike mature industries where the financial performance is shared around the specific business model and competition, substantial changes in the specific currency will have a direct impact on the failure or success of the company. The amount of profit or loss produced by one component of a business. With large companies, just knowing the gross margin for the entire business is not always enough. Knowing the segment margins for each division of the company that generates both expenses and revenues provides a more accurate picture of where the company is creating the most value and where its strengths and weaknesses lie.
3.4.STP
Segmentation, targeting, and positioning together comprise a three stage process.
Determine which kinds of customers exist
Select which ones we are best off trying to serve and, finally
Implement our segmentation by optimizing our products/services for that segment and communicating that we have made the choice to distinguish ourselves that way.
Bitcoin majorly segmented its market based on different parameters. It segmented them on age group, loyal customers buying Bitcoin from a long time, demographically.
Young, pale, techie and male. This has been the makeup of Bitcoin's core community since the cryptocurrency began, at least if media reports and Internet chatter are to be believed.
A complete profile of the average Bitcoin user by age, gender, location and background.
Detailed consumer spending data – how are people acquiring and using their Bitcoin?
Tips for companies expanding Bitcoin's technology to emerging markets and underrepresented groups.
Expert insight on Bitcoin's "branding problem" and why improving accessibility is critical.
The following are the ways which define how the segmentation was done by Bitcoin:
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Age: As per analysis, 60% of people were under the age of 35 years.
Gender: Despite a growing number of initiatives such as Bitcoin Women's Day, women using Bitcoin
are still a minority, with approx 90% of Bitcoin users identifying as male.
Income: While these figures reinforce the young, white, male stereotype, other findings – such as
average income – are more surprising. The question of average earnings providing a very even split across all earning brackets. People earning $50,000 – $100,000 were the major targets for Bitcoins as depicted below:
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Geography: A large no of buyers were from America. So, the Americans who lived in the North were
targeted the most. In terms of the location, 49.85% were based in North America, followed by 32.99% in Europe and 9.36% in Asia.
The following methods explain the targeting strategy for Bitcoin:
Bitcoin is conquering gambling market step by step - every year utilization rate of the crypto-currency as major one in online gaming houses all over the world grows. Due to a number of features Bitcoin is considered to be almost perfect payment unit. Realizing the benefits of working with virtual currency many operators create Bitcoin projects, providing their customers with such benefits as anonymity, high speed of transactions, absence of governmental control of any country, independence, security.
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It is these advantages that attract players from around the world. Bitcoin players are progressive and modern people straining after innovations. Before starting a Bitcoin project, operator should carefully study the target audience, since this group of people has their own features an d requirements. If operator doesn’t meet their demands, the favor of the customers will not be won.
Geography
Bitcoin was developed in the United States and gained widespread currency in North America. About 50% of Bitcoin players live in Canada and the USA; nearly 30% of players are from European countries and the remaining 20% are people from Asia, Africa, South America and the CIS. Thus, Bitcoin is virtual currency of the West and most highly developed countries. As for the languages that are used in Bitcoin, percentage ratio is as following: English – 38% Russian – 26% Spanish 5% Portuguese – 3% Welfare Bitcoin players are people with high income, and it is a huge advantage for the operator, since it guarantees stable revenue. In order to have bitcoins people should h ave certain funds, that is why target audience of the casino has medium income or higher. Age
According to the research Bitcoin casino players are young people between 25 and 34 years, predominantly male (more than 80%); although in recent years there is a tendency of the female audience growth. Age group of the target audience is also expands: Older people begin to trust Bitcoins and actively use them in their everyday life. It can be assumed that in the near future, even conservative and mature audience of online casinos will appreciate the advantages of the crypto-currency of the future. Interest and Activities
The range of Bitcoin users' interests is quite wide, but several main areas may be distinguished: innovation technology, financial markets and the world of entertainment in all its forms. Young people with good income have university degree; they are computer programmers, IT specialists and financial officers. Often Bitcoin players are well versed in the cr ypto-currency system; they are technically savvy 13
and have some experience. Therefore the requirements of such audience will be high and operators should take it into account while creating the project. Knowing the target audience of Bitcoin casino, as well as its detailed analysis will help operators to get maximum profit, meeting the needs of the customers and understanding their psychology.
How Bitcoins positions into the Market:
Bitcoin majorly focuses on opening platform where people can Bitcoins online. There is portal created to purchase the crypto-currency online.
Nowadays, it is very much in demand and a lot of people have started buying this. Because of which the demand for Bitcoins has increased at an exponential rate.
Individuals who invest in share market have an opportunity to buy more of these Bitcoins.
The major strategy behind positioning is by making the currency online. This makes it easier for the mass to buy the crypto-currency from the website in some very simple steps.
3.5.Product/ Service Mix Bitcoin is a cryptocurrency and was introduced in 2009. Since then Bitcoin has grown tremendously in its popularity and its coverage. Users have a bitcoin wallet on their phones or computers and with simple click of button bitcoins are exchanged for goods and services With increasing popularity, many prominent names across several industries are accepting Bitcoin as mode of payments. Few of them are:
WordPress.com
Subway
Microsoft
Reddit
Zynga
Bloomberg.com
Polish Airlines
With big names accepting Bitcoins, the confidence in the currency has increased with millions of people across the globe using it on a daily basis recording around 270,000 – 300,000 transactions per day, no wonder it has reached a market cap of $40 billion in no time.
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3.6.Marketing research On one hand where we see industries and countries adopting bitcoin, there are also few countries which have banned the use of bitcoins because the government regulators see it as a threat to the economy. Acceptance across the globe:
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Setbacks:
Although the price of bitcoin has gone up by 250% since last year, there is a decline in the acceptance of the cryptocurrency as a form of payment. One reason for the decline might be the unwillingness of the owners of bitcoin to use it for payment of goods because the appreciation of bitcoin till date has been very good. They rather see bitcoin as an investment vehicle and not a fiat currency that can be used for payment of goods.
4. Financials 4.1.Investment and Sales forecast Now a day any one can buy Bitcoin, it is no longer difficult to park your money with Bitcoin. There are multiple firms involved globally which are buying and selling Bitcoins. How it works?
Bitcoin is not directly related to a bank or government. There are multiple ways to invest in Bitcoins. First, these coins can be mined by individuals. Second, It can be bought on exchange. Individuals can also participate in funds which invest in Bitcoins. Bitcoins be bought and sold on designated exchange, therefor it provides liquidity to investors. Investment
Bitcoins have intrinsic value like gold, however there is huge risk of it acceptance by most of central banks in the world. There is another problem of its convertibility with formal currencies of different countries, inspite of all odds, this has a better future for a long term investor. Here is a reason, why it will become a good investment option for long term investor. 16
Despite of RBI (reserve bank of India) caution on buying this virtual currency, there are close to 2500 users are adding on daily basis in the list of Bitcoins. Sales Forecast
Based on an analysis done by one of the CNBC analyst, it expected that prices of Bitcoins can touch $100,000 in next 10 years, which will add close to 3500 percent growth in its prices. Saxo Bank published its annual report called "Outrageous Predictions" with one of the forecasts calling for bitcoin to hit $2,000 in 2017. When this report was written, bitcoin was trading at around $754, and today it has reached $4000, which is a rise of 430 percent. Current Trend in the prices of Bitcoins
Future expected price forecast of Bitcoins
Based on CNBC report, 10 year down the line there will be $5 Trillion dollar Average daily volume (ADV) in the world economy out of which ten percent will be taken over by cr yptocurrencies, which is 17
$500 billion dollar, and Bitcoin will have 35 percent market share, that will be $175 billion of $500 dollar. This means the daily trade of $175 billion
4.2.Expenditure forecast In order to invest in Bitcoins, individuals need to spend money on advance hardware and software so that they can mine this currency. Earlier, it was not very difficult to do so, however it has become very difficult now as number of miners are increasing on daily basis. This will also lead to higher cost of expenditure on hardware and software side going ahead.
4.3.Break even analysis What is the cost of Bitcoin mining hardware? According to some ecommerce site, a Bitcoin mining card will cost you $2000 and will require 350 W of power to run. Based these parameters, it seems that there are two kinds of cost associated with Bitcoins Mining. First, it is fixed, and second one is variable cost with will depend on number of hours spent. It is very difficult to suggest any break-even point for Bitcoins miners, as it depends on individuals, how well , he knows the entire system and what amount of effort he puts.
4.4.Linking expenses to strategy & tactics
Bitcoins are highly volatile as their value keeps fluctuating
There is high risk involved for companies who are accepting this as mode of payment
Below are the hourly and daily charts showing the volatile nature of bitcoins: Hour chart:
A bearish symmetrical triangle breakdown
A drop in the volumes over the last few hours
Rising trend line support at $4,700
A "symmetrical triangle" is a chart pattern characterized by converging top and bottom, and is formed when there is indecision in the marketplace. It may be both a reversal and a continuation chart pattern. A downside break, as seen on the chart above, shows potential for a pullback
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Daily Chart:
Volumes rose above the 30-day average on Monday, adding credence to the rally.
The 14-day RSI is rising and well short of the overbought territory (which would be above 70.00).
Both 5-day moving average and 10-day moving average are sloping upwards, indicating pullbacks are likely to be short-lived.
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5. Controls 5.1.Implementation Bitcoin has evolved to allow its powerful mining network, which is essentially a gigantic validation engine, to validate and record external non-Bitcoin transactions. The value of these services, a system of 'trustless trust' can prove much more valuable that Bitcoin itself as a digital currency. The entire financial, legal, and record-keeping industries can be disrupted using this decentralized, secure, and inexpensive method. Even if only a securities exchange application is brought online, the real-world value could be on the order of billions of dollars each and every year. Why would Bitcoin miners do all this validation work for 'free'? Because they are mining to earn new bitcoins. It is plausible that the value of Bitcoins earned in the future will embody some value commensurate with the validation work being performed. If that is the case, the dollar price of Bitcoins could rise as a result. Either way, Bitcoin 2.0 applications leveraging block chain technology will prove to be a powerful technology that is already starting to be implemented.
5.2.Contingency Planning A contingency plan is simply a proposed implementation plan that is triggered by some event, emergency or new information. The event or emergency may or may not happen but is liable to create significant business problems, potential or real liabilities if not dealt with quickly. Every business plan is based upon specific assumptions that you believe are true such as certain facts, projections and market trends. Your contingency plan simply outlines in advance what you will do in the case that a significant event, market shift or other major assumption changes. There are so many problems occurred after implementing the BITCOIN some contingency measure have been taken to avoid those problems as mentioned below:
Centralization of Bitcoin: Although bitcoin was built with good intentions in mind, a ltruistic systems
are often exploited. And this is what has happened to the bitcoin network, The problem is that there is little incentive to run a node anymore. That’s because powerful machines built specifically for bitcoin’s SHA-256 proof-of-work algorithm have changed its decentralized and more open nature.
Reactionary regulation: A number of countries taking a stance against digital currencies appear to be
more reactionary in their behavior than seems justified, In China, the major operators there are talking about upcoming periods of hardship as the government cracks down on bitcoin activities.Furthermore, amid rumors of a ban on virtual currencies in Russia, organizers recently felt impelled to cancelled a bitcoin conference that was planned to be held there. These actions perhaps reflect more about the 20
banking systems of those countries than anything a government official says. It reveals that many financial systems don’t want to compete with bitcoin; they would rather regulate it out of existence.
This is especially true since international borders simply cannot restrict bitcoin, the decentralized nature of which makes it impossible to bank. A better approach could be a wait-and-see attitude towards this new technology, since its advantages could end up befitting everyone. Countries currently taking this kind of approach include Canada and Israel.
Impact of Fork or network Splits: In software engineering, a project fork happens when developers
take a copy of source code from one software package and start independent development on it, creating a distinct and separate piece of software.
Plan to overcome: BITCOIN build in strong two-way replay protection. Failure to do so will impede our ability to preserve customers from these type of fork problems. Block chains also introduced for solving these type of software problems.
Blocks blocked by any HACKER: To overcome this problem BitCoin started Alerting users to stop
accepting payments, as an attacker clearly has too much control over the network. The network will be unusable for weeks or more while the issue is straightened out.
Secure Hash Algorithm: when any algorithm is attached then it will be tough for users to do
transactions because transaction blocks will be blocked and no alert message system will be work.
Plan to overcome: Users will be notified to shut down their clients. Note that the attacker may be able
to send valid alerts, which could disrupt notification efforts. OP_CHECKSIG will be changed to use some other hash outside of old blocks. All addresses in the version-1 chain that have a known public key and at least one unspent output will have their public keys hardcoded into the client. When a version2 transaction spends one of these version-1 outputs, the hardcoded public key will be used instead of the hash. The version-1 chain will be securely hashed into a hash tree. At least the root of the version-1 tree will be hardcoded into the client. All hashing Bitcoin does will use the new hashing algorithm. Still there are so many problems which BITCOIN is facing globally with both private players and the regulators of banking system around the world. There are so many ways that they have implemented to resolve the problems in each part of the globe but still not such a success technology where it is accepted by all over the world. As of now Canada and Israel are taking this type of approach in their economies. Therefore we can say that it will take some more time to become more active all over the world by solving all problems serially in away. 21
6. Conclusion The foundation of virtual currencies like Bitcoins as an intermediate of payments is not authorized by any monetary authority & central bank. “No regulatory approval, registration or authorization is stated to have been obtained by the entities concerned for carrying on such activities”. In less than a decade, bitcoin has gone from being a doubtful entity to a household name. Its value has risen - with ups and downs - from a few cents per coin to over $4,000. For the time being, hundreds of other cryptocurrencies equaling bitcoin in market value have emerged. With our marketing plan, implementation techniques and increase in the demand of the bitcoin will definitely going to make its way in to centrally accepted currency and with advancement in technology the security issue related to the crypto currency will tracked and tackled easily.
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