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Bitcoin is a digital currency that is decentralized and was created in 2009. The identity of

an individual that created the currency is still unknown and the currency offers the advantage of

lowering the transaction fees in comparison to the traditional online payment methods, the

currency is also operated by decentralized authority(Frankkenfield, 2021). All the bitcoins

transactions are verified by a huge amount of computing power through a mining process.

According to Frankkenfield (2021), for this reasons bitcoin has been accepted by some

organizations while others have rejected it. Unicef became the furst organization to receive, hold

and redistribute bitcoin in 2019. Others include the rainforest foundation, Save the Children and

Tor project. This paper focusses on such organization and give reasons why they opted for

Bitcoin while others are still hesitant.

Pseudonymity (near Anonymity)

Transaction of goods and services using digital currencies happens online and doesn’t

demand disclosure of identities. Nonetheless, a mutual fallacy about cryptocurrencies is that it

completes assures anonymous transactions, but in a real sense it only guarantees pseudonymity.

Data security has become a sensitive topic in the current century, and digital currency gives

consumers a platform to complete do online business without revealing their personal

information to the organization. Cryptocurrency gives the client advantages in situations of

identity theft and privacy, which are common in an online transaction.

Peer-to-peer purchasing

Organizations have been incurring high costs through financial institution intermediaries.

bitcoin has evaded the intermediaries hence lowering the transaction costs. For organizations, the

dearth of a middleman lowers the cost of the transaction. According to Bunjaku, Gjorgieva-

Trajkovska, and MitevaKacarski, ( n.d ), for customers, there is an advantage to the users in the
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event the is hacking in the financial system. For the sake of comparison, the traditional system

allows the banks to rely on backups in the event of damage or a hack in the database, on the

other hand, for digital currencies, the remaining portion of the transaction would continue to

confirm a transaction, if one portion is compromised (Bunjaku, F., Gjorgieva-Trajkovska, and

MitevaKacarski, n.d).

Protection from inflation

Many organizations have suffered from inflation, inflation causes traditional currencies’

value to decline with time. With digital currency, it’s always launched with a fixed amount that

is specified in the source code for instance there are 21 million Bitcoins launched in the world

today. Therefore as the demand for the currency increases, the value will also increase this will

hod the market and prevent inflation (Sion, 2010). Therefore organizations that embrace bitcoin

are looking for a stable currency that would not be affected by common economic factors like

inflation.

Self-governed and managed

Through its self-governance and maintenance nature, cryptocurrencies unlike the

traditional currencies are stored by miners/developers on their hardware, and they get the

transaction fee. Considering that the miners earn from it, they ensure that they keep the records

up to date, ensuring the currency’s integrity is maintained and the records decentralized

(Bunjaku, F., Gjorgieva-Trajkovska, and MitevaKacarski, n.d).

A fast way to transfer funds

Cryptocurrency is the optimal remedy for transactions, be it domestic or international

transactions, the technology gives a way of fund transfer at a lightning speed. This is because the

verification needs little time to process and there are limited barriers to cross
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On the other hand, hesitant organizations and some which have refused to embrace the

technology have done it for the following reasons (Bunjaku, F., Gjorgieva-Trajkovska, and

MitevaKacarski, n.d).

Digital currencies can be used for illegal transactions

Considering the security and privacy of bitcoin transactions are high, it’s hard for the

state authority to trace any user by their wallet address and keep track of their data. for this

reason, Bitcoin has been used as a mode of exchange for many illegal deals in the past.

Organizations would want transparency and would not want to use the same model used by

criminals. therefore this factor has prevented many organizations from using the currency

(Bunjaku, F., Gjorgieva-Trajkovska, and MitevaKacarski, n.d).

Data losses can lead to financial losses

The initial idea of the cryptocurrencies developers was to create a currency with

untraceable source code, impenetrable verification protocols, and strong hacking defense. This

was to make it safer and to put money on digital currencies than the traditional modes.

Nonetheless, if an organization loses the private key of their wallet, there is no reversal, the

wallet will remain locked and this may lead to huge financial losses for the organization

(Bunjaku, F., Gjorgieva-Trajkovska, and MitevaKacarski, n.d).

Decentralized yet still run by some organization

Cryptocurrencies are known for their nature of being decentralized. However, the amount

and the flow of some currencies in the market are still managed by their creators or some

organization (Bunjaku, F., Gjorgieva-Trajkovska, and MitevaKacarski, n.d).

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This means the developers have the power of manipulating the coin for large swings.

This makes it dangerous for organizations.

Conclusion

In conclusion, there are some concrete reasons why organizations are not integrating

bitcoin in their business, the change will be inevitable and gradually most organizations will

embrace it. Data security and privacy are key to any organization and cryptocurrencies somehow

guarantee it. Many organizations are researching digital currencies which is a positive sign that

the currency is there to stay.

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References

Bunjaku, F., Gjorgieva-Trajkovska, O. and MitevaKacarski, E., n.d. CRYPTOCURRENCIES –

ADVANTAGES AND DISADVANTAGES. [online] Eprints.ugd.edu.mk. Available at:

<https://eprints.ugd.edu.mk/18707/1/Cryptocurrencies.pdf> [Accessed 13 March 2022].

FC 2010, & Sion, R. (2010). Financial cryptography and data security: 14th international

conference, FC 2010, Tenerife, Canary Islands, Spain, January 25-28, 2010: revised

selected papers. Berlin: Springer.

Frankkenfield, J. (2021). Bitcoin Definition: How Does Bitcoin Work?. Retrieved 13 March

2022, from https://www.investopedia.com/terms/b/bitcoin.asp