Accounting and features of mathematical modeling of the system to forecast cryptocurrency exchange rate

Abstract

The objective of this paper is to determine the basic features of the use of mathematical modeling of the system to forecast cryptocurrency exchange rate. The study determines that cryptocurrency is the simplest investment asset being and, at the same time, the riskiest one. Advantages and disadvantages of cryptocurrency use are specified. Advantages include: code openness, anonymity, decentralization, emission, and reliability. Disadvantages include lack of guarantees, instability, risk of prohibition and possible loss. A model to forecast bitcoin cryptocurrency exchange rate is proposed and substantiated mathematically. The observations are the basis to develop a hypothesis: the faster the cryptocurrency (e.g. bitcoin) is mined, the more difficult it is to forecast bitcoin cryptocurrency exchange rate. Certain factors emphasize which may affect the cryptocurrency exchange rate: trade wars of the USA with other export-oriented world economies (China); advent of IEO as the alternative for ICO and new drivers connected with the interest in cryptocurrency; FATF recommendations for market control, the entry of world giants (e.g. Facebook) into the crypto-market and the development of the stablecoin market.

Analysis of Return and Risk of Cryptocurrency Bitcoin Asset as Investment Instrument

“…Use of the digital computing tools to process scientific, economic, and social information has changed the human capacity, considerably. Virtual space is being activated year over year being the result of efficient application of information resources [9].…”

Cryptocurrency as an Object in Accounting

“…Despite all the available scientific works, a problem of cryptocurrency accounting from the viewpoint of the International Accounting Standards (IAS) is still rather disputable [3]. On the one hand, the majority proposes to account it as a specific intangible asset as it meets the following conditions [4]:…”

Measuring the Value of Digital Assets for Accounting Purposes

“…For example, the exchange of Bitcoin Cash -Tether; Ethereum -WMZ. According to Part 2 of Article 715 of the Civil Code [4] and Part 2 of Article 293 of the Economic Code [4], the main participants in the contract (parties) are two sellers and two buyers at the same time. Since the first seller is the seller of a particular product and declares its value, and the other acts as a buyer who agrees with the declared value, but instead of money provides another product and declares such a value that satisfies him as the seller of the second product (buyer of first product) and another person of the buyer of the second product (seller of the first product).…”