2018 Undergraduate Business Case Study Competition - CMU Coin
Feb 7-10, 2018
Your team is comprised of representative employees of an outside consulting firm (you name your firm). You have been tasked by the PNC Center for Financial Services Innovation at the Tepper School of Business to propose potential use cases for CMU Coin, a crytocurrency that will serve as a testbed for the center’s research.
Your team will propose an original use case for CMU Coin. You are encouraged to use your intellect and creativity, in addition to the Communication Planner included here, to prioritize what is most important and decide the best path forward. Eventually, you must be able to show how your proposal is the best one for your client’s needs.
Your client envisions CMU Coin as a secure, legal, greener cryptocurrency that focuses on privacy rather than anonymity, and ensures continued decentralization as it matures. It will initially be used on CMU campuses by those affiliated with the university, although it may eventually be scaled out. Your clients are interested in innovative use cases that might go beyond basic transactions. Note that any member of any CMU campus could interact with CMU Coin.
Because this is a real-life case, your idea might inform the development of CMU Coin. You may even use CMU Coin one day.
What Is Cryptocurrency?
Cryptocurrency and Blockchain Could Transform Business As We Know It
Cryptocurrencies are Evolving To Serve Different Needs
Many of you have heard of Bitcoin, whose wild price fluctuations made headlines in 2017. Bitcoin, the original blockchain-based cryptocurrency, was made public in 2009 as a “purely peer-to-peer version of electronic cash,” according to the founder’s whitepaper. Since that time, it has evolved and even spawned a new cryptocurrency, Bitcoin Cash. Bitcoin Cash was created last year by Bitcoin community members frustrated by long transaction times and increasing fees. Now Bitcoin Cash claims to be “fulfilling the original promise of Bitcoin.” Although Bitcoin is still the largest cryptocurrency by market cap, some experts believe that it is now mostly useful as an investment and that its ability to function as a form of cash will become more limited. For more on how Bitcoin works, see this New York Times Q&A.
Beyond Bitcoin, cryptocurrencies might be used to fill needs unmet by traditional currencies. The city of Hull in the United Kingdom, for example, is using Hull Coin to pay residents for community service. Ripple, a digital payment protocol, wants to help banks process international payments at a lower cost. Some experts even think that digital currencies could become the standard currencies in countries with an unreliable traditional money supply.
Blockchain’s Potential is Still Being Plumbed
Uses for blockchain continue to unfold within and beyond the business world. Ethereum, the blockchain-based platform, supports smart contracts and could enhance other business operations. Blockchain technology is helping the United Nations distribute food and identifying slavery in the fishing industry. For more possible applications of blockchain, see the following:
- Deloitte’s report, Blockchain: Democratized Trust
- Global Cryptocurrency Benchmarking Study (see in particular the section beginning on page 25)
- Some resources from a UC Berkeley student org dedicated to blockchain development
- Coindesk’s “What Are the Applications and Use Cases of Blockchains?”
Problems and Drawbacks Need To Be Addressed
In addition to cryptocurrencies’ potential for skirting laws, it was recently reported that the Bitcoin network’s power usage exceeds that of Ireland and nineteen other European countries.