Amity Institute of Information

Technology
AMITY UNIVERSITY UTTAR PRADESH
LUCKNOW CAMPUS

TERM PAPER
ON
CRYPTO CURRENCIES

Submitted to
Amity Institute of Information
Technology
Table of Contents
DECLARATION BY THE STUDENT ................................................................................................................................................................................... 2

CERTIFICATE .................................................................................................................................................................................................................. 3

ACKNOWLEDGEMENT ................................................................................................................................................................................................... 4

Crypto Currency ............................................................................................................................................. 3

What is Crypto Currency ................................................................................................................................ 3
In this sentence what cryptography means .............................................................................................. 3
In this sentence what Blockchain means ................................................................................................... 3
Types of Cryptocurrencies ............................................................................................................................. 3
Some facts about cryptocurrencies ............................................................................................................... 4
Risks of using cryptocurrencies ..................................................................................................................... 4
Bitcoin is now a official digital currency in EL Salvador. ................................................................................ 4
Advantages and Disadvantages of Cryptocurrency ....................................................................................... 5
Advantages ................................................................................................................................................ 5
Mining In cryptocurrencies ............................................................................................................................ 5
Some Questions on cryptocurrencies that everyone think before investing in cryptocurrencies ............ 6
What Is Cryptocurrency in Simple Words? ................................................................................................ 6
How do crypto-currencies work? .............................................................................................................. 6
Is Ethereum is future of cryptocurrencies? ............................................................................................... 6
How Does Cryptocurrency Make Money?................................................................................................. 6
What Are the Most Popular Cryptocurrencies? ........................................................................................ 7
How to buy crypto currency? .................................................................................................................... 7
Crypto-Currency wallet .............................................................................................................................. 7
Why use Cryptocurrency?.......................................................................................................................... 7
Conclusion...................................................................................................................................................... 7
Crypto Currency
So first we know that what is crypto currency

It is a virtual asset currency that is secured by cryptography. It is a decentralized networks based on

blockchain technology. Main feature of cryptocurrencies is that they are not issued by any government
authority. So those individuals can send or receive crypto currencies directly without in support of any
organization or any bank.

First decentralized cryptocurrency is bitcoin was created by Satoshi Nakamoto in 2009.

What is Crypto Currency

Digital currency is an Internet based medium of exchange different from real currency (such as
banknotes and coins) that exhibits properties similar to real currencies but allows for instant
transactions and borderless transfer-of-ownership.

• Cryptocurrency: A digital currency in which programming techniques (cryptography) are used to

provide security and transfer of funds securely.

• The first cryptocurrency is Bitcoin which was created back in 2009. Nowadays there are thousands of
other cryptocurrencies.

In this sentence what cryptography means

It is a method of protecting exchange of information or communication through use of some layers of
protection. Like first it converts plane text in hash test then it encrypts the hash text by use of some sort
of encryption like symmetric or asymmetric encryption and then send it to whom the information is
intended.

In this sentence what Blockchain means

It is a type of database that records information in a way that makes it difficult or impossible to change
OR hack.

Types of Cryptocurrencies
The first blockchain-based cryptocurrency was Bitcoin, which remains the most common and most
useful. Today, there are thousands of alternate cryptocurrencies with different functions and
specifications. Several of these are duplicates or branches of Bitcoin, whereas others are new currencies
that were created from scratch.

There are many types of cryptocurrencies but some most valuable and popular currencies listed below

1. Bitcoin
2. Ether (Ethereum)
3. Binance Coin
4. Dogecoin

Some facts about cryptocurrencies

• There are more than 6,044 cryptocurrencies in existence as of june 2021.
• There are almost 350 crypto exchanges operating in India and estimations of the daily trading
turnover range from Rs 1000 crore to Rs 2000 crore.
• Bitcoin’s market cap is more than thrice that of India’s most precious company Reliance Industries.
• $1,635 billion or RS 1.25 crore is the estimated market capitalization of all cryptocurrencies and that
of Bitcoin only is more than Rs 50 lakh crore, making it larger than the combined market cap of the
six largest stocks in India, Reliance Industries, Hindustan Unilever TCS, HDFC Bank, Infosys
Technologies and HDFC.
• Ethereum market capatalisation is equal to the next six stocks. Also, we can say that the two biggest
cryptocurrencies market cap are bigger than the 12 biggest stocks in India.
• In India there are 10-12 million number of active traders and investors in cryptos. This is 16-20% of
the 60 million active stock investors and traders in our country.

Risks of using cryptocurrencies

Cryptocurrencies are targets for highly sophisticated hackers, who have been able to break through
advanced security systems. In banks there is a policy against frauds but in cryptocurrency if transaction
occurs then no one can undo it or change it. And in cryptocurrencies there is a lot of price volatility so it
can cost much sometimes than credit cards or cash. And nowadays there is a hype of cryptocurrencies,
so swindlers are taking advantage and cheat people with fake prospects.

Bitcoin is now a official digital currency in EL Salvador.

The first country in the world to adopt bitcoin as legal tender is El Salvador a small authoritarian-ruled
country in Central America. President of El Salvador Nayib Bukele announced that he would set Bitcoin
as the second state currency alongside the US dollar and said in a national address on 17 June, making
bitcoin legal tender will take effect on September 7 and now bitcoin its use will be optional. From all
these stories we can see that Bitcoin is spreading quite slowly, but the daily and weekly volatility
transform the view of the fundamentals.
Advantages and Disadvantages of Cryptocurrency

Advantages
1. With cryptocurrency transfer of funds becomes easier between both parties without need of any
bank or any trusted organization like phonepe or google pay. Theses transfers use cryptography to
maintain security.
2. Blockchain technology is completely decentralized, and it means that no centralized network can
claim control.
3. It boosts the business dealings making it sharper & cheap, also a dynamic solution for the
development teams that have to face settlement periods in the long run. Blockchain provides a
transparent ecosystem and cryptocurrencies are a component of this system. They allow the users
to record, view, and track their coins via all their accounts.
4. Besides paving the way for transparency, blockchain also makes the system auditable & verifiable.
These benefits make the environment stronger for the cryptos over the fiat currencies.
5. No hackers can attack the crypto systems as they are not supported by a centralized network. Along
with that, not even the Government can access on cryptocurrencies transactions.

Disadvantages

1. The major disadvantage of cryptocurrencies is that they are still virtual currencies and lack the value
compared to fiat currencies.
2. Cryptocurrencies stand at the last in the line of the present market. Gold & Silver constantly had a
high market value since the day they were accepted as a mode of exchange.
3. There are no constant values for cryptocurrencies as they are very volatile so their value depending
on the market value. Users must accept the currencies as tokens in the form of demand & supply.
4. Another bottleneck is that cryptocurrencies are plainly slow to process. People mining bitcoin to
make around 3 to 7 transactions each second and it’s a tedious process.
5. Even the crypto market is a victim of scam & fraudsters. Since there are no rules, crypto dealers can
manipulate user data, buy cheap tokens, and sell them at higher costs.
6. Bitcoin, for example, is a moderately poor choice for doing illegal business online, since the legal
analysis of the Bitcoin blockchain has helped agencies arrest and prosecute criminals.

Mining In cryptocurrencies
The term crypto mining means getting cryptocurrencies by solving cryptographic equations using
computers. It uses computer resources to mine the bitcoins.
In technical words, cryptocurrency mining is a transactional process that requires the use of computers
and cryptographic processes to solve complex functions and record data to a blockchain. In fact, there
are complete networks of devices that are involved in crypto mining and that keep shared records via
those blockchains.

• Mining programs tap into your computer's hardware resources and put them to perform mining
Bitcoin.

Some Questions on cryptocurrencies that everyone think

before investing in cryptocurrencies

What Is Cryptocurrency in Simple Words?

Cryptocurrencies are digital currencies that follows system of blockchain which is very secure so our
online payments designated virtual tokens.

How do crypto-currencies work?

Crypto currency is an encrypted decentralized digital currency that works using a technology called
blockchain.

Is Ethereum is future of cryptocurrencies?

So, In this we want to know that if we have to invest in cryptocurrency … Why Ethereum can be a game
changer and we must invest in 60:40 ratio like 60 in Ethereum and 40 in other cryptocurrencies.
Ethereum is the name of decentralized blockchain network. And in this the currency is ETHER. And it is
Rank #2 in the world as cryptocurrency market Capitalization. Its aim is to decentralize whole internet. It
works on smart contract. And it works on solidity coding language. If we make a smart contract with
anyone so it cannot be changed by anyone Even author cannot change it here code is law.

There is a decentralized app named as audius So what it will do it directly pay money to content creator
without charging any commission.

Like in nowadays the popular platform YouTube cuts 20 to 30% money as a commission from the whole
money that content creator made from ad sense and received from donations. So, in this YouTube
generates lot of money. So, if we make any decentralized application so there would not be any third
party which receives money as a commission. There is no crosscutting of money b/w sender and
receiver. But there is one flaw of that there is a security concern No one can be sitting and monitoring
those transactions are right or not.

How Does Cryptocurrency Make Money?

Investors can make money with cryptocurrency by selling their Bitcoin at a profit or by mining Bitcoin,.
What Are the Most Popular Cryptocurrencies?
Bitcoin is most popular cryptocurrency, followed by other cryptocurrencies such as Etherum, Binance
coin, and Doge coin.

How to buy crypto currency?

(Where can I buy crypto currency?)

• Crypto currencies are digital assets with following specific rules and can be exchanged between
users just like any other currency.
• In order to buy crypto assets, the corresponding of a currency exchange office is needed.
• This task is mostly done via an exchange or a broker.

Crypto-Currency wallet
A crypto-currency wallet is a secure digital wallet. It is used to store, send, and receive digital
currencies. Most coins have an official wallet, or a few officially urged third party wallets.

Getting a digital wallet

If we want to receive, store, or send INR, you need a bank account. In the crypto that is not needed, you
only need a digital wallet. There are many wallet categories and providers. To buy coins and set up a
wallet with Coin-base you will only need your ID, credit card or bank account details.

Why use Cryptocurrency?

1. Fast and safe
2. Transparent and neutral
3. Decentralized nature
4. Low inflation and collapse risk
5. Freedom to transact
6. Specially designed to take advantage of the architecture of the internet
7. Transactions are checked, or confirmed by the computers of the users on the currency's network
8. Computers that verify the transactions receive a small amount of currency as a reward

Conclusion
Cryptocurrency is an impressive technical achievement no one would be think that in future we use
digital coins which is known as virtual tokens but it exists in our world , but it stays a financial
experiment. It has also some advantages and disadvantages that we know previously in this report. It is
modern currency which is digital and secure also. And people from all over the world want to know
about it. In order to succeed for cryptocurrency if more people knows about cryptocurrency It is more
popular and it has a high probability to succeed in future.