Application of Cryptocurrencies Using Blockchain for E-Commerce Online Payment

Abstract

Owing to the distinctive properties of the blockchain, which is the decentralized and distributed ledger that is used to record transactions done, cryptocurrencies are being used as an online payment source in transactions. The cryptocurrencies, attributable to their notable characteristics, such as decentralized consensus, anonymity, distributed and shared ledger, immutability, and autonomy, are best managed with the blockchain. However, similar to other payment sources, the blockchain and cryptocurrencies are also prone to security attacks. The blockchain technology itself faces abuses, such as links to child abuse content, money laundering, tax evasion, financing illegal activities such as sex and drugs, and terrorism. In this chapter, the practical reach of cryptocurrencies to people and their use as an investment option are studied by getting responses from people through a questionnaire. To understand the real-time security threats that people have of cryptocurrencies and the prospects of cryptocurrency as a potential investment, a questionnaire on cryptocurrencies and its applications, potential risks seen by people, and its likelihood as an investment option is administered to a sample of 100 educated professionals. Analysis of responses shows that people are skeptical to adopt cryptocurrencies as an online payment medium owing to the security risks posed by it. The major security issues reported with cryptocurrencies are attacks on cryptocurrency wallet, time jacking, 51% attack, double spending, selfish mining, and fork issues. These issues are addressed by applying appropriate resolution techniques. Lack of common international governance and regulation has been found to be the primary cause of abuses of blockchain technology. This mandates that the world community come together and lay regulations and policies for preventing abuses on blockchain technology.