CRYPTOCURRENCY

Presented by :

Mansi Jain

Prateek Jadhav

Ishika Jhanwar

Devesh Solanki

Varun Agrawal

Introduction :

Any kind of money that exists digitally or virtually and uses cryptography to safeguard transactions is
known as cryptocurrency, also referred to as crypto-currency or crypto.

Blockchain :

A blockchain is a shared distributed database or ledger between computer network nodes. A

The way the data is organised in a blockchain differs significantly from how it is typically organised. In
a blockchain, data is gathered in groups called blocks that each include sets of data.

What is cryptocurrency ?

A digital payment system known as cryptocurrency doesn't rely on banks to validate transactions.
Peer-to-peer technology makes it possible for anybody, anywhere, to send and receive payments.
Payments made using cryptocurrencies do not exist as actual physical coins that can be transported
and exchanged; rather, they only exist as digital entries to an online database that detail individual
transactions.

A public ledger keeps track of all bitcoin transactions that involve money transfers. Digital wallets are
where cryptocurrency is kept.

Cryptocurrencies use a decentralised mechanism to track transactions and create new units rather
than a central body to issue or regulate them.
Due to the fact that transactions are verified using encryption, cryptocurrency has earned its moniker.
This means that the storage, transmission, and recording of bitcoin data to public ledgers all entail
sophisticated code. Encryption's goal is to offer security and protection.

The first cryptocurrency was created in 2009 and is still the most well-known today: Bitcoin. A large
portion of cryptocurrency interest is in trading for financial gain, with speculators occasionally sending
prices stratospheric.

Advantages and Disadvantages of Crypto

(ADVANTAGES)

Protection from inflation –

Over time, several currencies have lost value due to inflation. Almost all cryptocurrencies have a set
amount when they are first introduced. The number of any coin is specified in the source code; for
example, there were only 21 million Bitcoins published worldwide. Therefore, when demand rises, its
value will rise as well, keeping up with the market and, ultimately, preventing inflation.

Self-managed and governed -

Any currency's governance and upkeep are crucial to its development. The developers/miners who
store the bitcoin transactions on their hardware are compensated with the transaction fee.

Secure and private –

Cryptocurrencies have always placed a high priority on privacy and security. The blockchain ledger is
constructed using complicated mathematical challenges. Because of this, cryptocurrency transactions
are safer than regular electronic transactions. Cryptocurrencies employ pseudonyms that are
unrelated to any users, accounts, or recorded data that may be traced to a profile in order to improve
security and privacy.

Decentralized -

The fact that cryptocurrencies are primarily decentralised is a big advantage. Many cryptocurrencies
are controlled by the people who use them for development and by those who own a sizable portion
of them, or by an organisation that develops them before releasing them on the market.

Cost-effective mode of transaction –

Sending money across borders is one of the main functions of cryptocurrencies. It is also a cost-
effective method of transaction. The transaction fees that a user must pay are eliminated or reduced
to a small level with the use of cryptocurrencies. By doing away with the requirement for third parties
to validate a transaction, such as VISA or PayPal, it achieves this. This eliminates the requirement for
any further transaction costs.

A quick method of transferring money -

Cryptocurrencies have consistently maintained their position as the best option for transactions.
Cryptocurrencies enable instantaneous domestic and international transactions. This is due to the fact
that processing the verification only takes a short time because there aren't many obstacles to
overcome.

(DISADVANTAGES)

Can be used for illicit activities -

Because cryptocurrency transactions are highly private and secure, it is difficult for the government
to find any user by their wallet address or maintain track of their data. In the past, many shady
transactions involving the purchase of narcotics on the dark web have used bitcoin as a means of
exchanging money. Some people also utilise cryptocurrencies to convert their illegally acquired money
through a trustworthy middleman, concealing the source.

Financial losses due to data loss can occur.

Strong hacking defences, nearly untraceable source code, and impenetrable authentication methods
were all goals of the developers.

This would make investing in cryptocurrency more secure than doing it in physical cash or bank safes.
However, if a user misplaces their wallet's private key, there is no way to recover it. The number of
coins within the wallet will also stay kept away. The user will suffer financial loss as a result of this.

Although decentralised, some entity still manages it -

The decentralised nature of cryptocurrency is well-known. However, some currencies' issuers and
some organisations continue to have control over the circulation and stock of some of these
currencies. These holders have the power to control the coin's price with significant fluctuations. Even
highly traded coins like Bitcoin, whose value more than doubled in 2017, are susceptible to these
tricks.

Some coins are not available in other fiat currencies –

Some cryptocurrencies can only be exchanged in one or a small number of fiat currencies, making
some coins unavailable in other fiat currencies. This forces the user to first convert these currencies
into a significant currency, such Bitcoin or Ethereum, and then use other exchanges to convert that
currency to their preferred one. Only a few cryptocurrencies are affected by this. This adds extra
transaction costs to the process and results in unneeded expenditures.

Environmental harm caused by mining -

Cryptocurrency mining is a very energy-intensive process that requires a lot of computing and
electricity. The main offender in this is Bitcoin. Modern computers and a lot of energy are needed for
Bitcoin mining. It cannot be completed with standard computers.

Cryptocurrency in Fintech.

The typical banking customer who lives in a nation with a stable national currency is not very
knowledgeable about cryptocurrencies. These consumers don't have many reasons to choose
cryptocurrency over traditional money, unless they are early adopters by nature. They might even
consider cryptocurrencies to be too hazardous.

However, in regions of the world with unstable currencies, cryptocurrencies are more well-liked and
have higher adoption rates. For instance, when the bolivar rapidly devalued in Venezuela,
cryptocurrency quickly gained popularity as a more dependable, stable alternative.

A further group for whom cryptocurrencies are especially important is the roughly 1 billion people
globally who own mobile devices but have no bank accounts. These clients cannot use conventional
financial products because they are "unbanked."

The agonisingly slow pace of transaction approval, which is brought on by the numerous levels of
bureaucracy that such approvals often require, is one of the greatest grievances customers have with
traditional financial institutions. Anyone who has attempted to move money between banks across
borders knows how time-consuming the procedure can be. Even the exchange of funds between
institutions within the same nation frequently involves delays and inefficiencies.

Unlike conventional currencies, cryptocurrencies may be transferred back and forth considerably
more swiftly since they are based on a safe, decentralised public ledger. Additionally, this significantly
lowers transaction costs.

The fundamentals of Fintech innovation are speed, transparency, and convenience, and Bitcoin plays
a role in making it feasible to create solutions based on these ideas.