**Bitcoin and the World of Digital Currencies**

**Bitcoin and the World of Digital Currencies**

Asma Salman and Muthanna G. Abdul Razzaq Additional information is available at the end of the chapter

Asma Salman and Muthanna G. Abdul Razzaq

Additional information is available at the end of the chapter

http://dx.doi.org/10.5772/intechopen.71294

#### **Abstract**

[9] Copeland L. Exchange Rates and International Finance. 4th ed. Pearson: England; 2005. p.

[10] Dornbusch R. Exchange rate expectations and monetary policy. Journal of International

[11] Frenkel JA. A monetary approach to the exchange rate: Doctrinal aspects and empirical

[12] Wang P. The Economics of Foreign Exchange and Global Finance. 1st ed. Germany:

[13] Frenkel JA. On the mark: A theory of floating exchange rates based on real interest

[14] Pilbeam K. International Finance. 3rd ed. New York: Palgrave Mcmillan; 2006. p. 497

[15] Jha R. Macroeconomics for Developing Countries. 2nd ed. USA: Routledge; 2003. p. 496 [16] Frankel JA. No Single Currency Regime Is Right for all Countries or at all Times. NBER

[17] Calvo GA, Reinhart CM. Fear of floating. Quarterly Journal of Economics. 2002;107(2):

[18] Krueger AO. Exchange Rate Determination. 1st ed. New York: Cambridge University;

[19] Barro RJ. A stochastic equilibrium model of an open economy under flexible exchange

[20] Calvo G, Rodriguez C. A model of exchange rate determination under currency substitu-

[21] Dornbusch R. Open Economy Macroeconomics. 1st ed. USA: Basic Books; 1980. p. 293

[22] Agenor PR, Montiel PJ. Development Macroeconomics. 2nd ed. New Jersey: Princeton

[23] Mutluay AH, Turaboglu TT. The effects of exchange rate fluctuations on corporations and

[24] Akalin G, Uzgoren E. The impact of reel exchange movements on firm performance: An empirical study on Turkish firms. Cankiri Karatekin Universitesi IIBF Dergisi;6(1):449-469

tion and rational expectations. Journal of Political Economy. 1977;85:617-625

evidence. Scandinavian Journal of Economics. 1976;78(1):200-224

differentials. Journal of International Economics. 1979;69(4):610-622

500

379-408

1983. p. 218

University; 1990. p. 871

Economics. 1976;6(1):231-244

268 Financial Management from an Emerging Market Perspective

Working Paper 73381999; September. p. 49

rates. Quarterly Journal of Economics. 1978;92:149-164

evidence from Turkey. BDDK. 2013;2(1):59-78

Springer; 2005. p. 351

A peer-to-peer system of blockchain, originally started for a cryptocurrency Bitcoin, has caused major disruptions in the stock market. It has affected many businesses if not all, but its significance in the financial world is magnanimous. Historical data (daily rates) for the past 23 months are analyzed to understand the market size, market capitalization and price volatility for Bitcoin. Time series data and financial model are applied to realize the shocks. Monte Carlo simulation is applied to assess the dynamic structure of Bitcoin. With greater volume and activity, the banks and financial intermediaries may become outdated, and the middleman will have no place. It seems like a distant thought, but the facts are pointing toward its reality.

DOI: 10.5772/intechopen.71294

**Keywords:** finance, stock market, cryptocurrencies, Monte Carlo, ADF
