The Role of Bitcoin From E-Wallet in Development Financial Technology

(Fintech) As Electronic Payment

Rizal Mahendra Primadani
Fa’is Setiawan
Pramudya Anggar Kusuma

Abstract

Financial Technology (Fintech) is a financial innovation that may possible

making online transactions where can use anytime and anywhere, so make more
effective and efficient in the payment process. There are two kinds of payment in
fintech called payment gateway and e-wallet. Payment gateway allows customers
to choose the preferred payment method. In addition payment gateways, for more
example from fintech is electronic money and electronic wallets. Electronic money
is money that is packaged in digital where the money can be some tools of payment
for shop, pay bill and anything else, just with an application. For example of e-
wallet is bitcoin. Bitcoin is virtual money developed in 2009 by Satoshi Nakamoto
this money as well as Rupiah or Dollar. However, this money is only available in
the digital world. Bitcoin is stored in bitcoin wallet installed with PC / laptop, tablet
or smartphone. As a result, if the computer is damaged so the bitcoin will be lost.
So, bitcoin wallet must be backed up regularly to some devices. Bitcoin has several
advantages, for example like instant transfers because connected in every servers,
easy transfers, very small transfer fees, and very strong user identity security. But
the security of this user can lead to weaknesses, such as the difficulty of government
track and monitor various transactions made through bitcoin. As a result, these
bitcoins can be misused for terrorism, drug trafficking or money laundering.
Another disadvantage of using bitcoin is its easy hacked system (hacker),

Keywords: fintech, bitcoin, payment gateway, e-wallet, user, computer,

user.
A. INTRODUCTION
FinTech's concept where adapting technological developments combined
with the financial field is expected to bring a more practical, safe and modern
financial transaction process. There are many things that can be categorized into
FinTech field, including the process of payment, transfer, buy and sell of shares.
the process of borrowing money in peer to peer and much more. Based on research
conducted by Accenture, the overall investment in FinTech has begun to creep up
with a value of 3 times in the period 2008 until 2013. Even from 2010 until 2013,
the investment value in the realm of FinTech grows up to 4 times.
Bitcoin is a digital asset developed in 2009 by someone under the
pseudonym of Satoshi Nakamoto. This digital asset is like gold, but only available
in the digital world. The concept may sound like e-Gold, although it is actually
much different. Bitcoin developed with the idealism that a good digital asset is not
controlled by the government or central bank. Crisis Financial where have been
happing long-long time ago confirms that the government is always negligent in
maintaining economic stability. The government is always believed to be
dominated by corruptor and only works for personal gain, so financial decisions are
always on the side of a mere conglomerate. This concept appeals for people in the
world, especially geek or investors in the IT world’s. They start investing their
assets in bitcoin, while the world's economy is increasingly unstable as evidenced
by the banking crisis in America and Europe. Bitcoin is believed to be a digital asset
and a universal commodity so that prices will continue to soar.
The financial sector has been one of the biggest big data users in recent
years. Gartner said, 64% of financial companies use big data in 2013. The number
has been increasing for almost five years. Big data has transformed the industry in
a way that has never been done before. Maybe in Indonesia, there are still many
who hesitate to use big data on fintech companies because of various factors,
including cost and analytics competency big data.
However, not many people know that Indonesia has one big data analytics
named Paques. Paques is an analytical big data of Indonesian original creations that
features self-service analytic features, where users are not limited to IT divisions,
but also other divisions dealing directly with the fintech industry. This allows the
 company to make problem solving and gain insight more precisely on target. Big
Data transforms the financial industry, including fintech in many ways. Small
borrowers are able to get better support and are able to get funding easier than ever
before. This makes the industry more competitive, indirectly keeping rates low.

B. DISCUSSION
Using financial technology or that we know about FinTech has several
advantages in the world of IT-based payments. This is certainly the development of
the era will continue to bring changes in the development of world finance. The use
of FinTech can be analyzed by:
1. Use Big Data and Predictive Analytics to Make Better Actuarial
Decisions
One of the biggest implications is make the high formerly
consolidated industry more competitive. Fintech companies are able to
compete with large banks whose scale is much larger. Loan companies have
become heavily dependent on big data technologies in recent years. In fact,
big data has become one of the competitive advantages in an increasingly
crowded market.
The biggest advantage given to big data in Fintech companies is
predictive analytics. The lender can use the data to make decisions regarding
the client's risk profile. Using predictive analytics allows the brand to set a
more accurate borrowing requirement, which financially benefits clients
with low risk profiles. It also reduces the risk of unnecessary risky takings
taking without setting the right provisions.
2. Provide Better Value to Customers
Companies at every level use big data to offer better consumer
services. No exception to P2P lending industry. Many consumers expressed
their concerns about companies that have access to their data. However,
companies often use data to serve their customers better. Accenture claims
that consumers allow their data to be accessed by financial institutions if it
can improve the services they get, especially if consumers are looking for a
home loan or other loan.
3. Getting Funding
Big data is not only important because it provides value to
consumers. Since the Fintech companies need significant capital to flourish,
they have faced many challenges over the last decade. After the financial
crisis that hit the world in 2008, many financial institutions were hesitant to
offer the funding assistance that startups / startups needed to develop their
jobs. These new companies need to provide a good business plan to get the
attention of the investors.
Big data gives small borrowers the opportunity to demonstrate their
superiority in front of investors by making their data publicly available, so
investors can understand their investment returns, risks faced, or even force
companies to continue innovating because everyone can see the data it has.
Fintech as a new industry that emerged in the digital age growing, not least
in Indonesia. In Indonesia, Fintech is expanding in various sectors, from
startup purchasing, lending, financial planning (personal finance), retail
investment, crowdfunding, remittance, financial research, and so on. The
fintech phenomenon makes this field include hotspots for big data.
From that things it can be concluded that the use of FinTech is
necessary to be developed, but some aspects need to be considered again in
Indonesian. With the importance of financial technology, of course,
encourage the emergence of modern technology-based payment
instruments. We've heard that there is a sophisticated stock-based payment
tool that is Bitcoin actually there are some features of the use of bitcoin, as:
a. Instant transfer in peer to peer.

Peer-to-peer itself means Bitcoin runs without having acentral

server. The storage servers are decentralized and distributed divided into
various servers run by each user connected to the network.

b. Transfer to anywhere
Unlike gold, Bitcoin can be sent anywhere in seconds,whenever and
wherever you want. Shipping with Bitcoin can happen only with a
smartphone's capital and internet connection.
 c. Transfer fee is very small.

Shipping costs can be eliminated until free, but to speed up

transactions, your Bitcoin wallet will usually cost you around 500 - 3,000
rupiah, no matter how many bitcoins are shipped.

d. Transaction is irreversible, meaning once transferred can not be

canceled.

Bitcoin is given to someone else's hand, the transaction can not be

canceled unless the person is willing to send the Bitcoin back;

e. Bitcoin transactions are pseudonymous.

All transactions ever done at once Bitcoin balances possessed by

someone we can see, but we do not know who the owner of the Bitcoin
address if the owner does not tell it. Each Bitcoin user can actually choose
whether or not his name will appear, but even if the user wants to keep his
identity secret, all transactions are kept public and recorded.

f. Bitcoin is not controlled by any agency or government.

Bitcoin using the Blockchain database is not controlled by a party, but

is so open to the public that it is impossible for someone to forge transactions
in Blockchain. All transactions are recorded live, transparent, and spread over
millions of servers. Those who want to alter or falsify Bitcoin transaction data,
must hack millions of servers at the same time.

g. The number is limited

Bitcoin will only have 21 million Bitcoins worldwide. Bitcoin's

declining system of creation every four years resembles an economic system
based on deflation and with the increasing supply of bitcoin, bitcoin prices
tend to rise. You can transfer bitcoin to anywhere in the world as long as it is
connected to the internet. Bitcoin will be stored into the Bitcoin Wallet. This
wallet must be installed on both sides, can be with PC / laptop, tablet or
smartphone. After installing the wallet, you will get a Bitcoin Address. For
bitcoin transfer is very easy, open the wallet application, input Bitcoin
 Address of the transaction opponent and the amount of bitcoin you want to
transfer, then send

C. CONCLUSION

Financial Technologies fintech is very good to develop, but for bitcoin

applications is still debated by many parties, especially in Indonesia. The absence
of government regulation that regulates the application of bitcoin is also another
debate. So, in our opinion bitcoin is not appropriate if applied in Indonesia, it still
needs a lot of assessment. The open source bitcoin system allows a genius computer
to break into a bitcoin system and publish a number of bitcoins for itself. In fact this
system has been reviewed by various circles as flawless. Any past transaction data
is stored in all peers across the network, and should be in order. Each new
transaction will be verified by a number of newly declared valid peers.

You can get bitcoin by buying and mining. To buy bitcoin can be done in
exchanger. Secure, insecure bitcoin systems are users and money exchangers. Just
like internet banking passwords, hackers can easily steal some money from you if
the computer is infected with a virus. The bitcoin price can certainly be a
consideration in the financial investment in bitcoin. Besides as a means of payment
abroad, bitcoin can not be used in Indonesia related to some discrepancies in the
development of fintech with government regulations in Indonesia. But when viewed
from the development of media that explains bitcoin-related, that it causes the
enthusiasm for bitcoin everywhere will create a very high demand. Surely prices
will continue to soar many times over