European Journal of Economics and Business Studies, vol.4, no.3, pp.1-7, 2018 (Peer-Reviewed Journal)
As world economy evolved over years, barter which is a primitive transaction system left its place to money
system. Commodity and bimetallic systems of money resolved the problems, especially the requirement of
double coincidence of wants and eased the trade within parties. Chronologically, paper system of money
followed the commodity system and implemented via two methods. In the first method, convertible paper money
is converted into gold and silver by the authority that issued paper money. In the second method that is still valid
today, fiat money is accepted by parties because of its being a legal tender. Money supply definitions keep
changing as new liquid assets emerge day by day. Especially after the post global financial crisis, central banks
have a more critical function for the world economies. Keeping all these developments aside, surrounded by
fintech trends, financial system has confronted with a new instrument bitcoin that is first introduced in 2009.
Though there are still too many consideration about this new financial instrument, number of bitcoins has
growing since 2009 and has reached almost 17 million as of September 2018. Some economists consider bitcoin
and other cryptocurrencies as a threat especially for central banks’ emission power. In this study we try to shed
light to bitcoin, other cryptocurrencies and blockchain technology with regard to their evolvement and whether
they pose a threat or provide an opportunity to the financial system.