The importance of cryptocurrencies and their impact on international financial markets based on the evolution of bitcoin

Abstract

This article collects the results of an investigation carried out with the aim of determining the impact of cryptocurrencies, in general, and of bitcoin, in particular, on the international financial system. To this end, it is based on the origin of the cryptocurrency, its main characteristics, as well as its evolution during the period of 2019-2021. In the same way, the various applications that the cryptocurrency has, as an investment asset, and the Blockchain, as a payment system, are determined. This will serve as a basis to delve into the quantitative relationship that exists between the cryptocurrency market and the financial markets. To do this, it is modeled using a Vector Autoregressive (VAR) methodology in order to determine the possible impact. The conclusions show that the development and deepening of the cryptocurrency market has been possible given its greater use as an investment asset; but they also point out that local regulations, as well as their risk profile, limit their use. In addition, the effect that traditional market indicators have on bitcoin is significant at a mathematical level, so the behaviors and volatility characteristic of conventional markets have had an impact on the stability of cryptocurrencies in the period analyzed.

Realidad Empresarial No. 14, 2022: 10-25.