The Economics of Cryptocurrency
Cryptocurrencies claim to be the future of money and payments, the lifelines of any business. An informed evaluation requires understanding both the economics and the computer science behind the technology. Designed for an MBA elective on money and banking, this technical note guides students through the building blocks of cryptocurrencies using the one that launched them all: Bitcoin. To provide a logically consistent framework for interpreting future innovations, the technical note digs deeper into the technological ingredients of Bitcoin than is typical in economics, while also connecting the technology back to a core set of economic principles, all in an accessible way.