Features and potential of crypto currencies – with special review on Bitcoin- magazine Economy and Business

 

author: Dejan Graorkovski

During the first few months of 2021, just as in the past year, the entire world and the domestic public witnessed the extreme price growth of the largest crypto currencies relative to their market capitalization. The oldest and most popular crypto currency (Bitcoin) reached growth of 600% in year 2020, and only at the beginning of this year its value was increased by another 80%. In addition, the value of the other most traded crypto currencies, as are Ethereum, Litecoin and XRP, has grown by 1.010%, 350% and 230%, respectively.

As a result of this vertiginous price growth, market capitalization of crypto currencies reached amount of 1,6 trillion USD, whereby the Bitcoin contributes with 68%. Such figures have not left unmoved even the strongest critics of Crypto Market.

Having in mind these developments, at the beginning of the text we shall try to explain the features of the crypto currencies and purpose for their creation. In addition, further in the text, we shall analyze the potential and future perspectives of this market segment, aiming to get clearer picture of the direction it might move to.

A crypto currency may be defined as a form of digital ownership used as an asset for exchange of goods and services. The method of providing security of transactions is enabled by use of technology named blockchain. At the same time, a control is carried out over the creation of additional monetary units through this technology, as well as confirmation for the currency transfer. Most famous and most valued currency, measured by the market capitalization, is the “Bitcoin”.

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Presidential elections in the USA and consequences over change of value of the US Dollar- magazine Economy and Business

 

author: Jovan Kiprijanov

At the beginning of November 2020, presidential elections should take place in the United States of America, where Donald Tramp, as representative of the Republican Party and Joe Biden, as representative of the Democratic Party would confront as presidential candidates. Uncertain is the victory of any of these candidates at the elections and the outcome of it would have mayor impact over the financial markets in the world.

Usually the elections have positive impact over the USA economy, but this time the circumstances are different due to the newly occurred situation with the Corona virus pandemic. Therefore, the US Dollar may be noted as the most affected from all the other currencies, which largely depends on the developments in the USA economy.

At the beginning of Corona virus pandemic, the US dollar became safe haven currency for investing in the world (together with the Japanese Yen), so the currency pair EUR/USD at mid-March 2020 reached the highest level relative to the EUR (1, 0658), i.e. the April level of 2017, as a consequence of increased demand for US dollars and need for liquidity in this currency. Unlike this period, for the past three months the pair registered the lowest level in the past two years (1.1941), which is an indication of high currency volatility in period of mayor changes and movements at the world markets. An index of US Dollar was reduced by almost 7% for the last quarter, although for the first three months of the year it grew continuously. Having in mind the economic recovery of Europe from the Corona virus pandemic, as well as the manner of dealing with, the introduction of restrictions and relaxation of measures compared to the one of USA, it is concluded that it has contributed to a weaker USD relative to the EUR. Continue reading “Presidential elections in the USA and consequences over change of value of the US Dollar- magazine Economy and Business”

COVID-19: Economic consequences over the world economy and their buffering- magazine Economy and Business

 

author: Dejan Graorkovski

In the past month, at global level, we were witnessing major declines and volatilities at stock markets and financial markets as noted for the last time during the big financial crisis 2008-09.  While back at those times, the largest “culprits” for the occurred crisis were the financial institutions, this time the mayor factor is quite untypical. The newly occurred situation is a result of the high exponential spreading of the respiratory Corona virus (aka COVID 19) from China to Europe, and eventually in the USA. At the moment, infected are residents of around 150 countries around the world. Currently, its spreading is the highest threat for the world economy and global financial markets.

Because of such development of the situation, the WHO reached a decision to declare a state of global pandemic.

With the virus COVID19, which was detected for a first time at the beginning of January in the city of Wuhan (part of the prefecture Hubei) in China, until March 11, 2020 infected were 81.250 Chinese, and 3.253 passed away (mainly citizens of Wuhan). Right when at the end of February, the Chinese authorities managed to localize the virus spreading, it begun to spread massively through Europe, mostly in Italy and Spain, while at the moment USA and Italy are exceeding China per number of infected citizens. The statistics from Italy are terrifying, where the number of the deceased reached extreme 10.779, and almost identical is the situation in Spain. Neither the Balkan Peninsula, including our state, remained immune to this virus. Still, the number of the affected and deceased is quite smaller than the above mentioned regions.

Due to the extreme and rapid spread of the virus, for which there is still no appropriate vaccine or medicine, the state governments were forced to undertake rigorous measures aimed at preventing further expansion. Continue reading “COVID-19: Economic consequences over the world economy and their buffering- magazine Economy and Business”