Conscious consumer behavior in the world of cryptocurrency I Part

Introduction

With the increasing technological revolution, all the bureaus of human life including society, economy, politics, and environment are incorporated with the technology, whether it’s artificial intelligence, big data, data-driven databases, the internet of things, machine learning, cloud computing systems, robotics, and various other forms, have entirely changed the conventional methods used for executing various operations. This technology has primarily worked by replacing the older structural hierarchies and strategies with new techniques, that are more secure, transparent, automated, and efficient.

And since economic sustainability is directly associated with social development, political stability, and environmental advancement, therefore, it is considered critical, giving it the most important among all bureaus. That’s why technology has been mostly deployed to the mechanisms that are either directly or indirectly associated with economic development. Hence, as a result, new and digitalized methods of the economy have been introduced, which have largely influenced the systematic mechanism of the international, national, as well as organizational structures of finance, and monetary policy. And though there have been numerous new inventions in the economic world, a recent invention of cryptocurrency, a form of digital currency has entirely revolutionized economics (Dwyer, 2015).

Figure 1 Research Methodology

Figure 2 Data Collection Methods

1.1. Research Objectives:

• To evaluate cryptocurrency and the various properties of cryptocurrency including its types, implications, and regulatory methods, with an analysis of the market trends of cryptocurrency.
• To analyze the conscious consumer behavior in the world of cryptocurrency, by evaluating the perspective of consumers about cryptocurrency, and their inclination towards adoption of cryptocurrency as a medium of payment.
• To evaluate the advantages of the cryptocurrency and their resulting impact on the consumer behavior.
• To evaluate the disadvantages of the cryptocurrency and their resulting impact on the consumer behavior.

1.2. Research Questions:

• What is cryptocurrency and what are the various properties of cryptocurrency including its types, implications, and regulatory methods, with an analysis of the market trends of cryptocurrency?
• What is the conscious consumer behavior in the world of cryptocurrency, and what are the perspectives of consumers about cryptocurrency, and their inclination towards the adoption of cryptocurrency as a medium of payment?
• What are the advantages of the cryptocurrency and how these advantages affect consumer behavior?
• What are the disadvantages of the cryptocurrency how these advantages affect consumer behavior?

1.3. Significance of the Study:

The research is significant to analyze the implications of cryptocurrency, concerning the various parameters that affect the market of cryptocurrency, and influence consumer buying behaviour, including factors such as advantages, and disadvantages which predict changing behaviour of consumers in the market. Hence, the research is critical for economists and consumers, to analyze various facets pertaining to cryptocurrency, and for policymakers to make administrative policies as per the behaviour of consumers.

1.4. Problem Statement:

Conscious consumer behaviour in the world of cryptocurrency is highly critical, since it is pivotal for the success of the market, and for increasing the value of the currency, thereby mitigating the negative impacts of the currency.

1. Research Methodology:
1.1. Research Background:

This chapter includes the research methods on which our research will be based, including various research strategies and research paradigms, all collectively used for the assortment and analysis of data. Research methods are specifically defined as the various strategies and various techniques used for evaluating, analysing, and computing data, which is collected as per the research methods. When conducting research, the research method specifically allows a reader to comprehend and understand the primary objective of research, and analyze the major motives of the research incorporating research questions, research goals, research paradigms, and significance of the research, enabling the reader to understand the research critically. These research systems are primarily, as asserted by Baker et. al., a source-based articulation of a research problem, which is strategically resolved by using a set of research strategies, encompassing the study of literature, theoretical the assumption, a method to assort data, and a technique for analysing and computing this data.

It has been asserted by researchers that the principal difference between a successful research method and an unsuccessful research method is the validation of the research objectives and research questions. A successful research method clearly states the data, and evaluates it about the research objectives, whereas, an unsuccessful research method deviates from its research questions and fails to elaborate on research objectives. Furthermore, an effective research method effectively elaborates the various variables, including both dependent and independent, thereby evaluating the relationship between these variables and the research objectives.

Moreover, research methods are highly important as these enable the researcher to overcome various opera­tional and functional difficulties, which is a significant hurdle in devising data and providing the researcher with effective methods to analyze and elaborate data, leading to the formu­lation of an action plan that ensures successful execution and enactment of research.

1.2. Research paradigms:

Research paradigms are predominately the process that ensures that the research method, that is implemented for the execution of the research, is the best method among all methods, and is perfectly suitable for comprehension and articulation of specified research objectives and research questions. Furthermore, a research paradigm primarily proposes a subjective receptacle of research, to evaluate the subjective background of research questions. There are various types of research paradigms used in research including radiology, epistemology, positivism, and interpretivism.

This research, the evaluation of conscious consumer behavior in the world of cryptocurrency, is evaluated by using the philosophy of positivism, as this theory is highly efficient in proposing a validated theoretical proposition, within the context of data collection and data analysis methods, based primarily on data acquired from a vast population using a field survey, or interview. Furthermore, Collis as Hussey asserted that positivism is highly rigid, and is highly resolute, since it is unaffected by external factors, that somehow affect the efficacy of the results obtained from research. Secondly, the positivism research method is best to evaluate the perspective of the people and to analyze the various socio-political and socioeconomic factors that affect a bureau, analysed research. And, in this research, we analyze consumer buying behaviour, therefore, positivism is the best deductive strategy to be used.

1.3. Research Approach:

Research approaches incorporate the various strategies, that are used in the research to ensure that research methods and research paradigms are implemented effectively, and righteously to obtain effective and validated results. There are two primary forms of research approaches, including a deductive approach and an inductive approach. The deductive approach tests a hypothesis by using quantitative research methods, whereas the inductive research methods investigate research questions by using a research survey, based on the evaluation of the perspective of people, their behaviour towards a specified market, their personalized opinions, and personalized preferences, as asserted by Dash and Malhotra. Hence, in this method, we use an inductive research approach and evaluate the behaviour of the consumers towards cryptocurrency, based on an online generates questionnaire. The inductive method is highly productive, as it is very effective in evaluating a research question, by correlating the behaviour of the people with the literature review, to form a relationship between the hypothesis and the previous research. Therefore, it is extremely important for the execution of research effectively.

1.4. Data Collection Method:

The research method used for the collection of data is quantitative since it is based on primary data, using an exploratory quantitative method that will incorporate a hierarchical questionnaire to collect data from different people to induce attention to the research. This questionnaire will be created using the very effective, Google Forms, and will be shared with the respondents through email, WhatsApp, Messenger, and other social networking accounts. The focus group incorporates 190 respondents, from different parts of the world, with different ethnicities, educational backgrounds, social receptacles, and economic frameworks. This ques­tionnaire will explicitly evaluate the various facets related to cryptocurrency, and will primarily analyze the perspective of consumers about cryptocurrency, and the constantly growing market of cryptocurrency.

Furthermore, the questions will also pertain to the analysis of the various advantages of the cryptocurrency, as well the disadvantages, to analyze their major perspective including both the reason for their inclination towards cryptocurrency and the reason for restraining from it. These all questions will be coherent to the research questions and research objectives and will be formulated in such a way that it leads to a detailed evaluation of the primary goals of the research. Moreover, these questions will be formulated as per the literature review, so that research h creates a connective link between the findings and the existing data, allowing the reader to comprehend and assess the data by themselves, deducing useful insights into the findings obtained. Moreover, the questionnaire will incorporate comprehensive questions, that will drive multi-dimensional knowledge, driving comparative and quantitative data for interpreting data, and providing validated and authentic data. Hence, the research questionnaire will be generated effectively, keeping all facets into consideration for detailed execution and enactment of the research methods, proposing a descriptive evaluation and computation of data.

1.5. Research Sampling:

The research is based on random sampling, as the questionnaire was distributed throughout Asia and Europe, using social networking accounts, and all the respondents are considered as a single group of the population. However, this random sampling incorporates two types of population groups including proportionate and disproportionate sampling. This research has used proportionate data sampling, which will be highly beneficial for the execution of data, and to keep the results unbiased from the demographic background.

1.6. Ethical Considerations:

Following ethical considerations were taken before conducting research,

• The data was collected by following coherent principles of ethics, which were provided by the educational institute. Furthermore, a consent form was provided to the respondents of the questionnaire to give their approval to participate in the research.
• As a rudimentary facet of ethical consideration, the researchers ensured that the generation of any unrelated or insignificant data was avoided, to validate the data.
• Moreover, all the literature reviewed in the research is backed by proper Harvard referencing, to demonstrate the background of the literature explained.

1.7. Issue:

•  Proper consent was acquired from the respondents before the collection of data, as a receptive approval form was filled out by respondents before filling out the questionnaire.
• The survey was examined before the collection of data, and respondents were notified through a questionnaire. Furthermore, the privacy of the respondents was given special emphasis by anonymizing the respondents.
• The data obtained from the questionnaire was primarily stored in password-protected software and the transfer of the data obtained from the questionnaire to any other computer or researcher was prevented as a protective policy.

1.8. Reliability and Validity:

Reliability is defined as the explanation of the various components of the data analysis, by using the various factors that ensure that the research was conducted using reliable sources, and the results obtained are backed by validated facts. The research has used the data collected from reliable sources, primarily a questionnaire that includes highly educated respondents, who provided their unbiased and realistic responses, for validated research. Moreover, their responses were correlated with the literature obtained from credible sources, including journal articles from Google Scholar, books from Sci-Hub, research papers from Research Gateway, and others. Moreover, the disproportionate random sampling method has been used to enhance the reliability of data collection, to minimize the effect of external factors affecting the research results.

1.9. Research Limitations:

Following are some of the limitations of the research:

• The total time provided for the collection and analysis of data was quite definitive, and it was arduous to conduct research within this short period of time.
• Research was executed voluntarily, and no financial assistance was provided, therefore the research is conducted with the limited finance of the researcher.
• The research, since, includes a research questionnaire, in which data is collected from participants, therefore there is a high probability that the result might be affected by external factors including demographics, educational background, regional and social advancement, and others.

1.10. Time Horizon:

The time for the research is defined, as a structural and cross-sectional timeline was provided to complete the research within a specified period.

2. Data Analysis:

As we have used a semi-structured questionnaire for the collection of data, which has been filled out by 109 respondents, from different parts of the world, and with different cultural, social, educational, and financial backgrounds. Therefore, in the first part of the questionnaire, the background of respondents was evaluated, considering their professional background, education, age, and salary, which diversify the research.

Considering the profession 75.2% of the respondents, nearly 82 respondents are students, 5.5% of the respondents, nearly 6 respondents were self-employed, or businesspeople as regarded conventionally, 19 of the respondents nearly 17.4% are employed, while 1.8% nearly 2 of the respondents had different professional background. The research was conducted specifically by people of different professions, to collect diversified data, and analyze the perspective of people from different professions, diversify the research, and mitigate the effect of external factors.

Similarly, considering the financial system of the respondents. The respondents were asked about annual salary before tax, 8% of the respondents nearly 8 respondents had an annual income from 20,000-30000 USD, 3% nearly 3 of the respondents had an income from 30,000-40,000 USD. 15 respondents nearly 15% had an annual income from 10,000-20,000 USD, 6% of the respondents had more than 40,000 USD, while 68% nearly 69 respondents had less than 10,000 USD. This difference in the annual salary of the different respondents is highly beneficial for analysing the impact of the crises management packages on consumer buying behaviour, as financial hierarchy, largely pertains to consumer buying behaviour.

The respondents are also varied in terms of their age, as 17.4% of the respondents nearly 19 respondents were between 25-40 years, 78% nearly 85 of the respondents were aged between 18-25 years, 1.8% of the respondents nearly 2 respondents were less than 18 years, and 2.8% of the respondents nearly 3 respondents were between the ages of 40-55 years. This age difference is significant, as the consumer buying behavior is largely reliant on age since people of different ages have different buying preferences, this also increased the efficacy of the results, as it minimizes the effect of external factors.

Similarly, if the educational background of the respondents is considered. 51.4% of the respondents, nearly 56 of the respondents were graduates, nearly 25 of the respondents are high school students, 18.3% of the respondents, nearly 20 of the respondents are post-graduated, 7.3% of the respondents, nearly 8 of the respondents have different educational backgrounds, 22.9% of the respondents. This difference again is considered significant for minimizing the impact of the external factors, and for obtaining accurate and validated research.

And the last informational question that respondents were asked about their financial sustainability, as financial receptacle plays a considerable role in shaping consumer buying behaviour, and an important role in predicting the preferences of consumers, and their inclination to the cryptocurrency. Consumers were asked if they consider themselves financially stabilized. 40.4% of the respondents, nearly 44 respondents asserted that they were not financially stabilized, 36.7% of the respondents, nearly 40 respondents implied that they are financially stabilized, while 22.9 % of the respondents, nearly 25 respondents were not sure. This shows the diversity in the financial hierarchy of the consumers, and thereby diversity in the consumer buying behaviour, which in turn depends somehow on these external factors of financial sustainability, education, salary, and others.

The next section of the questionnaire is based on the analysis of the cryp­tocur­rency, which incorporates the evaluation of the conscious consumer behaviour toward cryptocurrency, incorporating the various advantages, disadvantages, and implications of the cryptocurrency as defined by the consumer.

Hence, analysing the conscious con­sumer behaviour towards cryp­to­currency, we asked the consumers, if they have ever heard about cryptocurrency, nearly 89.8% of the respondents, 97 people asserted that they had heard of cryptocurrency, 7.4 of the respondents, 8 people asserted that they had not heard about cryptocurrency, while 2.8% of the respondents, 3 people were unsure.

This indicates that a majority of the respondents were aware of crypto­cur­ren­cy, while a small population of people is only unaware of the cryp­to­currency, which shows that cryp­to­cur­ren­cy is quite renowned all across the world, with expanded brand awareness, and expanded geographical presence, which does not only demonstrate the success of the cryptocurrency market, but also the increased inclination of people towards the currency.

Similarly, evaluating further the conscious consumer beha­viour in the world of cryptocurrency, we analysed the extent to which cryptocurrency is accepted and adopted in the world, as a medium of exchanging goods and availing services. When respondents were asked if they use cryptocurrency as a medium of payment, nearly 72.5% of the respondents implied that they do not use cryptocurrency as a medium of payment, 23.9% of the respondents implied that they use cryptocurrency as a medium of payment, while 3.7% of the respondents, 4 people were unsure.

This shows that though most people are aware of the cryptocurrency, and acknowledged it to be a validated currency, however, they have yet not adopted it and used it as a medium of payment, and have not replaced it with conventional money. This is directly related to the literature, which demonstrates that that cryptocurrency is somehow not so popular throughout the world, but is specifically concentrated in some geographic zones, which is primarily because of the disadvantages of the cryptocurrency, including price volatility, scalability, lack of investment values, and various others. In nearly, 195 countries situated on the map of the world, only 10 countries are found to be extensively incorporated into the market of cryptocurrency, which primarily includes Canada, the United States of America, Brazil, Russia, Australia, Spain, India, Japan, Ukraine, and Argentina, all responsible for the advancement of cryptocurrency. Though cryptocurrency is quite flourishing in these zones, however, other countries are quite restrained from using cryptocurrency. This can also be associated with a large number of scams, that people face while using cryptocurrency as a medium (I G, 2020).

Similarly, respondents were also asked if they preferred cryptocurrency over federally generated currency, nearly 45.9% of the respondents, 50 people asserted that they do not prefer cryptocurrency over fiat currency, 31.2% of the respondents, 34 people implied that they prefer cryptocurrency over fiat currency, while 22.9% of the respondents were unsure.

Considering fundamental differences, the cryptocurrency can only be accessible through the internet by using a computer, mobile, or laptop since these types of currencies are only available in electronic form. Besides, physical appearance or physical attributes, another predominant distinction between paper money and digital money is that digital money can be used to avail services and purchase goods not only across cities, countries but also continents, which makes it the most seamless invention of technology. It has been asserted by R Grinberg that cryptocurrency primarily lacks physical attributes, or material existence, which is the principal difference between federally generated currency or paper money and digital currency. Paper money is used nearly everywhere, for the exchange of goods and services at international, national, and provincial markets, whereas digital currency is primarily used for the specified markets, which conventionally use an electronic wallet, which can easily access the internet or other networks related to the internet.

In other words, physical currencies such as minted money or banknotes are real and definite, showing their physical presence. Moreover, the transactions involving the exchange of these currencies are only possible as both parties involved in the exchange have physical ownership of this paper money. And though the use of cryptocurrency is the same, since both are used to buy various goods and services, the mechanism of how these currencies operate is entirely different from each other. This demonstrates that though most people do not prefer cryptocurrency over federally generated currency, which can be associated with numerous facets, including regulatory problems, price volatility, scalability, lack of inherent value, and others. However, a very significant comparison exists here, between the people not using cryptocurrency, and the people preferring cryptocurrency. Nearly 72.5% of the respondents, which incorporate 79 people asserted that they do not use cryptocurrency as a medium of payment. However, only 45.9% of the respondents which encompass 50 respondents asserted that they do not prefer it, which shows that a the specified proportion of people not using cryptocurrency want to switch to cryptocurrency, demonstrating the increasing growth of the market of cryptocurrency, the prospective potential that the industry withholds, since, a large group of the population prefers cryptocurrency over the federally generated currency, and will replace it with fiat currency in the future. Hence, based on the analysis, we can hypothesize that, The market of cryptocurrency is yet to flourish and expand since a large number of consumers prefer cryptocurrency over fiat currency, and they’re not using it currently, indicating that these people might switch to cryptocurrency in the future, based on their personalized preferences.

Figure 3 Profession of Respondents

Figure 4 Annual Salary of RespondentsFigure 4 Annual Salary of Respondents

Figure 5 Age of Respondents

Figure 6 Education of Respondents

Figure 7 Financial Stabilization of Respondents

Figure 8 Knowledge of Cryptocurrency

Figure 9 Cryptocurrency as a medium of payment

Figure 10 Cryptocurrency as Federal Currency

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Dr. Attila Szakács Associate Professor,
University of Debrecen, Szolnok Faculty, Economics, Institute of Marketing and Trade,

Dominik Szakács MSc Student,
Budapest Bussiness School – BGE KKK,

Dr. Zsolt Szakács Education expert,
Merkating Nonprofit Ltd.,

Budi Setiawan PhD student,
Hungarian University of Agriculture and Life Sciences,