Cryptocurrency is a modern decentralized medium of exchange that offers unique inflationary protection. Using traditional microeconomic tools, a new utility function of three goods - cryptocurrency, cash, and traditional assets is selected. Income effects, price effects, and consumer preference effects are then investigated through endogenous shifts in parameters and values. Consumer preferences based on perceptions of asset characteristics yielded the largest shifts in the price of cryptocurrency. Particularly, regulatory bodies should further investigate these markets to quell speculative trading and fraud.

• This report represents the work of one or more WPI undergraduate students submitted to the faculty as evidence of completion of a degree requirement. WPI routinely publishes these reports on its website without editorial or peer review.

Creator

• Peterson, Cole

Subject

• Industry

Publisher

• Worcester Polytechnic Institute

Identifier

• 50211
• E-project-030822-153237

Keyword

• Cryptocurrency
• Stocks
• Cash
• Behavioral economics
• Microeconomics

Advisor

• Smith, Alexander D.

Year

• 2022

Date created

• 2022-03-08

Resource type

• Major Qualifying Project

Major

• Mathematical Sciences

Rights statement

• In Copyright

License

• Creative Commons BY Attribution 4.0 International