PHD E-Commerce Proposal Sample

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Introduction

Financial inclusion is emphasized as a strategy for relieving poverty in the 2030 Agenda for Sustainable Development. Recently, the empirical argument for the effectiveness of supporting larger development goals through financial inclusion has grown stronger (Arner et al., 2020). Robust studies demonstrating an influence on poverty reduction are emerging: Individuals and enterprises who are financially included have access to appropriate and cheap financial goods and services that fit their requirements – exchanges, purchases, investments, lending, and insurance – that are offered in a socially and environmentally responsible manner (Inoue 2019; Omar and Inaba 2020; Williams, Adegoke and Dare 2017).

This term incorporates a wide range of essential financial services. Cryptocurrencies, in principle, provide trade, transaction, and value storage services. However, transaction fees and price fluctuations differ from application to application. Blockchain technology can transform interest-bearing savings accounts, loans and credit ratings, and insurance (Vincent and Evans 2019). Smart contracts are a crucial tool for programming such systems. Furthermore, blockchain technology can potentially change identity-management plans, removing a significant barrier to financial inclusion (Wang et al. 2019).

Access to a financial institution is essential for financial inclusion since it allows for the storage of money and the sending and receiving payments and acts as a portal to other financial products (Williams, Adegoke and Dare 2017). According to World Bank estimates, 2.5 billion individuals did not have an account in 2010.

By 2015, financial inclusion has significantly risen, bringing the total to 2 billion individuals. The introduction of mobile banking aided this accomplishment, notably in Sub-Saharan Africa, where 13% of individuals have mobile payment accounts. 46% of digital payment account users in the region did not have a bank and financial facility profile.

Hence their sole financial inclusion was through digital payments. And access to generally recognized and secure crypto money might be a valuable substitute for accessing a transaction account. Payments would be possible, as would the ability to hold money, and it might also serve as a portal to other financial services (Arner, et al. 2020).

Although there are no legal access limits for cryptocurrencies, user-friendliness should be enhanced. It may also raise adoption rates, perhaps the most significant impediment to realizing decentralized ledgers’ game-changing potential. Nonetheless, blockchain technology has a home edge in terms of both domestic and international remittances.

Essential financial services are (i) reasonably easy to supply using current blockchain systems and (ii) an essential component of financial intermediation. Furthermore, the developing blockchain technology and hyper ledger are often regarded as the most significant universal developments since the internet’s inception.

The potential of blockchain for enhancing land records is also examined to demonstrate a non-financial application of the technology. Although the link between land registries and financial inclusion may not be apparent, formally registered property is a significant type of collateral. As a result, improved land registries may help to improve loan availability (Williams, Adegoke and Dare 2017).

Research Significance

Practical Significance

Cryptocurrencies, particularly Bitcoin, the most well-known, are currently a prevalent issue. In the wake of the closure of the biggest and most popular Bitcoin exchange, Magdas (2014), and the loss of an estimated US$ 500 million in Bitcoins, it’s vital to revisit digital currencies, their risks, and their importance for financial inclusion. Many laud cryptocurrencies as the most significant monetary invention of modern time, while others dismiss them as little more than “revolutionary optimism.”

They demonstrate the possibility for financial transactions, particularly international transactions, to shift from currency to digital form. As someone who works in financial inclusion, she ponders if cryptocurrencies may play a part in the critical road toward more integration, which eventually demands less reliance on cash for low-income customers.

Other cryptocurrencies exist, including XRP, ADA, and SOL, but Bitcoin, which debuted in 2009, is the first decentralized mainstream Peer to peer payment network and digital money. Unrelated to tangible, government-backed fiat currencies, Bitcoin is a web, software-dependent, inflation-resistant money that may be acquired with cash and traded for services or products with businesses that recognize it.

The market supply of Bitcoin is set at 21 million, which means that once 21 million “coins” exist, the monetary value will be decided entirely by consumption (Berentsen and Schär 2019). Bitcoin’s popularity in developed economies has grown significantly in the last four years, not necessarily because it is a more convenient medium of exchange.

But because it is new, fascinating, a source of income for Bitcoin miners and hedge funds, it reduces the costs retailers incur from embracing credit card transactions (Aysan, Demirtaş and Saraç 2021). Therefore, this research is essential in finding more empirically robust evidence for the role of cryptocurrency in financial inclusion.

Theoretical Significance

Furthermore, as previously said, BTC and other notable cryptocurrencies have received much attention in recent years. This cryptocurrency, also known as a digital coin or virtual currency, is obtained and sold over the blockchain system (Aysan, Demirtaş and Saraç 2021). The use of blockchain technology in cryptocurrencies has aroused suspicions in the financial industry, government, stakeholders, and private investors.

Since the introduction of BTC in this decade, the emergence of cryptocurrency has taken the market by storm. Cryptocurrency is expected to be the future currency that will eventually replace paper money across the world. While the interest has piqued consumers’ curiosity, many are unaware of the potential, downsides, and problems ahead (Mohania and Singh 2020).

Cryptocurrency research is still limited and in its early stages. This article will explore the potential in cryptocurrencies, such as the security of its technology, cheap transaction cost, and high investment return, to provide meaningful guidance and point of view to the academic field and users. This research will conduct a thorough examination of cryptocurrency’s future endeavors and applications. Therefore, it will present comparative ideas of various field experts, showing different dimensions of the research covering the opinions in favor and against the use of cryptocurrency. It will help future researchers to build on these dimensions.

Literature Review

According to Vincent and Evans (2019), their study uses fully modified ordinary least squares (FM-OLS) and causation analysis to explore the relation between cryptocurrencies like bitcoin, the internet, cellular phones, digital payments, and banking sector development in Asia and Africa from 2010 to 2018. According to the empirical evidence, cryptocurrency, internet activity, and cellphone subscription services have a significant positive relationship with financial inclusion and banking sector development.

Implying that countries with higher levels of crypto assets, internet activity, and cellphone subscription services have higher levels of financial inclusion and banking sector development. This conclusion is supported further by a causality test, which demonstrates that bitcoin, internet usage, and cell subscription lead to financial inclusion of the economy in both regions. Gomez et al. (2019) took it one step ahead and analyzed the importance of blockchain in omitting financial intermediaries.

To summarise, economic theory has seen cryptocurrency as an institutional technology thus far. To some extent, it is, but we were more concerned with whether it is a new and perhaps superior middleman. They discovered that it performs some intermediate jobs effectively, but not others. In some instances, blockchain requires mediators to operate.

For example, while the blockchain can transform collaborating, all agreements remain imperfect; compliance is trivial once regulations consent. However, the existence of the blockchain is dependent to some extent on contract law, and disagreements may emerge that require external verdict and compliance. From a policy perspective, their analysis suggests the need for regulation. It also means that code should continue to encourage the decentralized development of technology. It reflects the nature of blockchain: it is a partially transformative technology, requiring perhaps a moderate regulatory approach.

Similarly, Norta, Leiding, and Lane (2019) found moving funds and obtaining credit across international boundaries remains difficult, time-consuming, and costly. Long waits, exchange rate fluctuations, counter-party risks, bureaucracy, and significant paperwork also plague existing money transfer methods. 2 billion individuals are expected to be unbanked and have no or limited access to financial services. Providing viable financial assistance to this demographic is frequently cited as a critical step toward eradicating global poverty and reviving local economies.

Everex aims to solve the problem of financial inclusion by utilizing blockchains for cross-border transfers, online purchases, currency trading, and micro-financing without the volatility concerns associated with existing, non-stablecoin cryptocurrencies. This research paper bridges a technological gap by offering a blockchain-based capital transfer system to minimize financial inclusion obstacles and deliver financial services to the underbanked. They discussed the system’s benefits, the program’s objectives and aims, and the design of the Everex financial eco-system. Furthermore, they presented the findings of an Everex remittance system case study involving over 150 Burmese immigrant workers.

On the other hand, Mohania and Singh (2020) went deep into this area by highlighting challenges faced by cryptocurrency. According to them, BTC is the first virtual money with independence, privacy, and double-spending prevention characteristics. Bitcoin first appeared in 2009, and  Satoshi Nakomoto established it. It accounts for about half of the cryptocurrency market capitalization.

And with cryptocurrency still in its early stages of research and use to upgrade payment infrastructures, savings and efficiency issues associated with its use remain significant obstacles. Price volatility and scalability limitations also raise doubts regarding virtual currencies’ viability as efficient and effective payment tools, particularly in developing countries.

The study is based on secondary data gathered from many publications, papers, and websites, among other sources. The research concluded that while cryptocurrencies have significant shortcomings in substituting physical currency. This Blockchain technology underpins their architecture can be used in world commerce, trade finance, and cross-border payment processing transfers, in addition to plugging leakages in social benefit transfers in low-income countries.

At the same time, it can be used in various economic applications in developing countries, such as developing virtual land records, financial inclusion, and reimbursement transfers to low-income families. The significant challenges remain in terms of internet communication, higher transaction costs, electricity distribution shortfalls, and the low issue of economic education.

Similarly, according to Ohnesorge (2018), since US soap operas’ days, cryptocurrencies have garnered a growing amount of media interest. Bitcoin price surges have been a recurring phenomenon throughout the years. The situation has also been referred to as a BTC bubble, which warns against the notion that prices would continue to rise indefinitely.

The media’s coverage also has a significant impact on Bitcoin’s short-term price fluctuations. In the long run, essential elements such as Bitcoin’s velocity, equity market indexes, and exchange rates are determining factors. The exchange rate of BTC has surged from USD 1 in 2010 to more than USD 60,000 in 2021 due to both short-term and long-term causes.

This surge in value was accompanied by extremely high – but gradually reducing – levels of volatility. At the time of publication, Bitcoin’s 120-day fluctuations against the US dollar were still hovering around 50%. The majority of other cryptocurrencies are also experiencing severe fluctuation.

Nonetheless, according to Berentsen and Schär (2019), it concentrates on BTC since its fluctuation has been studied more fully in the literature than in any other cryptocurrency. Bitcoin’s high level of volatility severely limits its functioning as a currency. Although excessive volatility impedes functions two and three, it may also indirectly affect function one.

Risk-averse customers will try to limit their access to a volatile currency, which means they will have to buy Bitcoin right away before using it to buy something. It raises transaction fees and reduces BTC’s use as a medium of exchange. However, there are fiat-pegged cryptocurrencies that nearly entirely avoid fluctuation.

Tether, which supports its cryptocurrency version of the dollar (USDT) 100 percent with US dollars, offers perhaps the most straightforward answer to this problem. One USDT can always be swapped for one USD. Furthermore, the central banks of Australia and China are investigating the introduction of crypto versions of their respective legal currencies.

Furthermore, distributed ledger-based payment systems such as Ripple and Stellar enable users to transmit fiat IOUs directly. Thus, a high level of volatility does not apply to all cryptocurrencies. Therefore, these problems of instability cast doubt on the positive role of cryptocurrency in financial inclusion.

Research Questions

This study will address the following questions:

• What is the role of Cryptocurrecny in financial inclusion?
• What are the advantages and disadvantages of using Cryptocurrecny for financial transactions?
• What do financial and technical experts around the world think about the role of Cryptocurrecny in financial inclusion?
• What changes does, according to the experts’ cryptocurrency require for a place in the modern financial world?

Proposed Research Methodology

It will be mixed research based on primary. For primary data, it will use two instruments. The financial and technical experts will be asked questions through online questionnaires made on Google forms. And for further insights, the experts will be interviewed (Due to Covid-19, if it isn’t possible, then it will rely on questionnaires).

The data collected through questionnaires will be analyzed quantitatively through statistical methods such as descriptive statistics and regression analysis. And the qualitative analysis will be done on the interview transcripts. The population for this research will be financial and technical experts working in financial institutions or academia.

And for inclusion criteria, the people with a minimum of 5 years of experience will be questioned because they would’ve spent a fair deal of their time in their fields. Therefore, it will increase the validity of the research. And lastly, for sampling, judgment sampling will be used because it will help minimize the false observations.

Bibliography

Arner, D.W, R.P Buckley, D.A Zetzsche, and V Robin. 2020. “Sustainability, FinTech and financial inclusion. .” European Business Organization Law Review 21 (1): 7-35.

Aysan, A.F, H.B Demirtaş, and M Saraç. 2021. “The Ascent of Bitcoin: Bibliometric Analysis of Bitcoin Research.” Journal of Risk and Financial Management 14 (9): 427.

Berentsen, A, and F Schär. 2019. “Stablecoins: The quest for a low-volatility cryptocurrency.” The economics of Fintech and digital currencies 65-75.

Gomez, M, P Bustamante, M.B Weiss, I Murtazashvili, M.J Madison, W Law, T Mylovanov, H Bodon, and P Krishnamurthy. 2019. “Is Blockchain the Next Step in the Evolution Chain of [Market] Intermediaries?”

Inoue, T. 2019. “Financial inclusion and poverty reduction in India.” Journal of Financial Economic Policy.

Magdas, Adriana. 2014. Cryptocurrencies and Financial Inclusion – Why I Am a Skeptic… For Now at Least. https://www.centerforfinancialinclusion.org/cryptocurrencies-and-financial-inclusion-why-i-am-a-skeptic-for-now-at-least.

Mohania, S, and S Singh. 2020. “An analysis of cryptocurrency and its challenges.” EPRA International Journal of Multidisciplinary Research (IJMR) 104.

Norta, A, B Leiding, and A Lane. 2019. “Lowering financial inclusion barriers with a blockchain-based capital transfer system. In.” IEEE INFOCOM 2019-IEEE Conference on Computer Communications Workshops (INFOCOM WKSHPS) (IEEE) 319-324.

Ohnesorge, J. 2018. “A primer on blockchain technology and its potential for financial inclusion (No. 2/2018). Discussion Paper.”

Omar, M.A, and K Inaba. 2020. “Does financial inclusion reduce poverty and income inequality in developing countries? A panel data analysis.” Journal of Economic Structures 9 (1): 1-25.

Vincent, O, and O Evans. 2019. “Can cryptocurrency, mobile phones, and internet herald sustainable financial sector development in emerging markets?” Journal of Transnational Management 24 (3): 259-279.

Wang, S, L Ouyang, Y Yuan, X Ni, X. Han, and F.Y Wang. 2019. “Blockchain-enabled smart contracts: architecture, applications, and future trends.” IEEE Transactions on Systems, Man, and Cybernetics: Systems 49 (11): 2266-2277.

Williams, H.T, A.J Adegoke, and A Dare. 2017. “Role of financial inclusion in economic growth and poverty reduction in a developing economy.” Internal Journal of Research in Economics and Social Sciences (IJRESS) 7 (5): 265-271.