This document discusses issues with the current global financial system and presents Bitcoin as an alternative. It outlines how central banks were established to serve private banks, and how the 2008 crisis occurred due to low interest rates fueling a housing bubble based on risky subprime loans. The document then introduces Bitcoin, describing how it uses cryptography and a peer-to-peer network to control currency creation and transfer without central authorities, potentially providing a more ethical online payment system.

1. Towards an Ethical Online
Payment System
Marwa Yousif
Abdi O. Shuriye

2. OUTLINES
• The Economy of Deception
• The Story Behind Central Banks
• The Global Financial Crisis: What Has
Happened?
• Alternative? the Bitcoin System

3. The Economy of Deception
Friedman and the Monetarism Theory
MV= PY
M: Money Supply,
V: Velocity ( a measure of how
fast people spend their money)
P: Price levels
Y: an indication of the real GDP,
a measure for economic growth
Nobel Price Winner 1976

4. The Economy of Deception
Friedman and the Monetarism Theory Cont.
According to Friedman:
People should spend their money
MV= PY
Behavioral
Governments should print money
Banks should lend it

5. The Economy of Deception
To
Market
the Culture
of Spending

6. OUTLINES
• The Economy of Deception
• The Story Behind Central Banks
• The Global Financial Crisis: What Has
Happened?
• Alternative?, the Bitcoin System

7. Central Banks

8. The Story Behind Central Banks
Private Banks of New York
reeling from the 1907 financial
crisis, decided that they needed
a governmental established
entity to lend them unlimited
amount of money next time a
panic arose.

9. The Story Behind Central Banks
Mission Accomplished!
In 1914, they have achieved that when the Federal
Reserve of America established using their political
influence and the Weapons of Mass Deception
(Media). Central banking system was established to
serve the best interest of private banking

10. OUTLINES
• The Economy of Deception
• The Story Behind Central Banks
• The Global Financial Crisis: What Has
Happened?
• Alternative?, the Bitcoin System

11. The Global Financial Crisis
What Happened??
The Monetarism Theory, and the Federal Reserve Roles

12. The Global Financial Crisis
The American Dream and the Housing Boom
Fancy, Luxurious Houses

13. A Dream?
Cheap Money
Low Interest Rates
Luxury
Fancy Houses

14. Or a Nightmare??
Interest Rates
Rise
Defaults
Subprime Debts
Foreclosures

15. The Global Financial Crisis
The American Dream and The Housing Boom
It Was a Nightmare, and Still Is!

16. Inflating the Subprime Bubble
Selling Loans: Mortgage- Backed Securities MBSs

17. The Fall

18. The Fall Cont.
They have triggered a subprime tsunami that has nearly
drown the World Economy

19. The Fall cont.
And
More

20. Credit Cards
Credit cards- Backed Securities is
a $365 billion market (2008)
21st Century Slavery

21. OUTLINES
• The Economy of Deception
• The Story Behind Central Banks
• The Global Financial Crisis: What Has Happened?
• Alternative? the Bitcoin System

22. Bitcoin
designed around the
idea
of
using
cryptography to control
the
creation
and
transfer of money,
rather than relying on
central authorities

23. Bitcoins Defined
Bitcoin is a virtual currency scheme based on a peer-topeer network. It does not require a central authority in
charge of money supply, financial institutions are not
involved in the transactions. All these tasks are
performed by the users themselves.

24. Bitcoins Defined cont.
Bitcoins can be spent on both virtual and real goods
and services. Its exchange rate with respect to other
currencies is determined by supply and demand and
several exchange platforms exist.

25. Securing the Bitcoin System
By implementing Public- Key Cryptography,
and Proof- of- Work Concepts

26. Conclusion
Riba Verses, Albaqara