Introduction to Cryptocurrency

What is Crypto?

Cryptos are Virtual Digital Assets based on Blockchain Technology.

They can be transferred from one party to another without the help of
middlemen. They are not issued by any government entity but are
generated through a process called mining.

Cryptos are mined and managed by a Distributed Network of

computers. This network of computers makes the Blockchain.

The first Crypto to be launched was Bitcoin, in the year 2009. Since
then, there have been over 10,000+ cryptos.

Traditional currencies like INR and USD are used within a country’s
jurisdiction and are bound by Government rules. Cryptos on the other
hand can be used globally. Each Crypto works on its Blockchain
network spread across many regions or sometimes many countries.
 How do Cryptos work?

A few questions which puzzle everyone

new to the Crypto world are

How are Cryptos created?

What is Crypto Mining?

If a centralised authority is not responsible for the creation
of Cryptos, then where do they come from?

If you are someone who is intimidated by these questions, trust us,

we will help you get to the bottom of the subject in this article.

Cryptos are generated through a process known as Mining. This is

similar to mining Gold or Silver, but instead of using earth as a resource,
Cryptos are mined through a process called the Consensus mechanism.
A consensus mechanism is a method through which a transaction on a
Blockchain ledger is validated by all the members of the network.

Now that you are acquainted with the basic terminology of

Blockchain workings, Let us take Bitcoin as an example to
understand mining.

We have stated earlier in the article that all transactions of a Crypto are
recorded on a Distributed Ledger known as Blockchain. Each
transaction has the details about the sender, the receiver, and an
encrypted Digital Signature of the transaction.

Miners on the network compete with each other to decode the digital
signature of the transaction, and the correct decrypted version is known
as the hash function. The one who does it first is rewarded with
Bitcoins. These transactions are recorded on a block and each Block
address is
linked to the previous Block on the network, thus making a Blockchain.
This consensus mechanism to mine a Bitcoin is known as Proof of
Work.

There are several consensus mechanisms like Proof of Stake and Proof
of Authority, and each consensus mechanism works differently. The
point to be noted is that these mechanisms are there to ensure the
Validity of transactions, remove middlemen and avoid Counterfeiting of
Coins.

Types of
Cryptos

Bitcoin

Bitcoin is the first crypto asset to be created. It was created in the year
2009 by an institution or person who goes by the name Satoshi
Nakamoto. Bitcoin was proposed as an alternative to Fiat Currencies.
In the wake of the 2008 financial crisis with the loss of trust in Financial
Institutions, a non-corruptible asset class was needed for people to use
as a store of wealth. Thus, bitcoin was invented.
Bitcoin runs on an open-source Blockchain Ledger, which can be
viewed by anyone around the world. All transactions of Bitcoin ever
done can be viewed on this Blockchain. These transactions cannot be
erased and once appended they are on the Blockchain forever creating
a
non-corruptible ledger system. Few characteristics of Bitcoin
which makes it a formidable asset class are

1. Bitcoins are finite

There will only be 21 million Bitcoins. The Bitcoin Blockchain protocol is

designed in such a way that no more than 21 million Bitcoins can be
mined. This makes Bitcoin scarce, unlike Fiat currencies which are in
abundance. Scarcity coupled with growth in demand increases the
value of the asset.

2. Incorruptible system

The Blockchain system which powers Bitcoin is one of the most novel
ways of Financial transparency. Every transaction can be seen along
with the addresses of the parties participating in the transaction. These
transactions cannot be erased thus making the system fully proof.

Altcoins
Coins alternative to Bitcoin are called Altcoins. The technology which
enables transactions of these coins is the Blockchain technology
similar to that of Bitcoin. But each coin has its use case.

The most famous Altcoin in the Crypto market is Ether ( ETH). Ethereum
Blockchain which powers Ether enables smart contract agreements.
These agreements are code enabled and do not require a third party.

Other well-known Altcoins are Solana, Cardano, Binance Coin, etc. As

of March 2024, there are 13,217 cryptocurrencies in existence.
However, not all cryptocurrencies are active or valuable. Discounting
many “dead” cryptos leaves only around 8,985 active cryptocurrencies.
There are around 420 million cryptocurrency users across the globe.
Stable Coins

These are coins that are pegged to a Fiat currency. For example, USDT
is a Crypto asset that is pegged to the United States Dollar. The value of
1 USDT is equal to 1 USD. Stablecoins can be a less volatile option for
people interested in investing in the crypto world. They come with the
favourable aspects of security, transparency, and transferability of the
Cryptos coupled with the stability of Fiat Currencies.

Tokens

Coins and Tokens are often used interchangeably, but the two are very
different. Crypto Tokens do not have their own Blockchains whereas
Crypto Coins do. For example, the Basic Attention Token ( BAT) is a
token that uses the Ethereum Blockchain for all its transactions. As
setting up a Blockchain network is difficult and energy-intensive, the
BAT founders have decided to focus on their product ( The Brave
Browser) and use the Ethereum Blockchain for all transactions.
 How to Buy and Trade Crypto In
India
The easiest way to buy and sell Crypto is by using a Crypto exchange.
Crypto exchanges are platforms where buyers and sellers in the
Crypto market interact.

Crypto exchanges allow users to buy, sell , lend and exchange cryptos
with ease. Close to 98% of funds are stored securely in Multisig cold
wallets. Zebpay is one of India’s leading Crypto exchange with close
to 150+ Cryptos

How to Store Crypto

Exchange Wallets

These are wallets provided by a crypto trading platform. Users

can store their Cryptos in the wallet and can use the assets to
trade instantaneously.
Cold Wallets

Cold wallets are hardware wallets that can store your cryptos. They
are inaccessible to the internet and can be sealed with secure keys.
Ledger Nano X, Ledger Nano S, and Trezor Model T are some of
the best-known Cold wallets.

Hot Wallets

These are digital wallets using which Crypto transactions can be

carried out. They are easy to use when compared to a cold wallet,
as your Crypto is readily available in the wallet to make transactions.
MetaMask is a famous hot wallet used to buy Ethereum-based ERC
20 tokens. These wallets can be used as extensions to your
browser.

Paper Wallets

Paper wallets are literally what they mean. You can print your public
and private keys on a piece of paper. The keys are displayed
through
 a QR code. Transactions can be carried out by scanning the QR
code through a mobile device or providing the public key to whoever
wants to pay you. Paper wallets were famous before digital wallets
caught fame but are not used now as paper is fragile, and the risk of
losing a piece of paper is very high.

Traditional Currencies vs Crypto

Crypto assets are decentralised whereas Traditional Currencies

are issued by the Reserve Banks / Federal Banks of countries

Crypto assets are regulated by the rules of the Blockchain whereas Fiat
currencies are regulated by the rules of Federal Banks and
Governments

Crypto assets can be used as a medium of exchange in a few

countries, but in most nations, Cryptos are used as investment options.
Traditional currencies are primarily used as a medium of exchange and
are often found to be poor wealth creators as they are exposed to
Inflation

Few Crypto assets like Bitcoin have a finite supply which makes
them scarce. Traditional currencies on the other hand are not backed
by a commodity and can be printed as per requirement.

Cross-border payments are quicker and more economical for

Crypto payments when compared to Fiat transactions.
 Benefits of Crypto

Cryptos are backed by the power of Blockchain – Blockchain

technology is a powerful tool on which all Crypto assets are mined. It
has transformative applications which are already seen in industries
such as Decentralised Finance and Metaverse. Blockchain technology is
helping innovators create remarkable applications in various fields.

The transactions are transparent – All transactions ever made can

be viewed on Public Blockchains which makes Cryptos transactions
fully transparent

Financial Inclusion for people from around the world – In many

parts of the world, Fiat currencies have lost their value due to excessive
inflation and large-scale value erosion. Crypto assets can be a boon
to these nations. Anyone with a cell phone and internet access can be
an active Crypto holder

Easy to make cross-border payments – Cross border Wire transfers of

Fiat Currencies are time taking and expensive. Crypto transactions on
the other hand are secure, quick, and stress-free. All the sender needs is
the public key of the recipient to send Crypto assets.

Are Cryptos legal in India?

Crypto assets are not illegal in India. The legality of crypto assets has
been a subject matter of discussion by lawmakers, but currently, there is
no ban or any prohibition or specific regulation on the use of crypto
assets in the country.

It is to be noted that recent amendments to the Income Tax Act,

1961 include taxation provisions applicable to cryptocurrencies.
 My Understanding of the Future of
Cryptocurrency?

● Cryptocurrencies will increase in legitimacy in the years to come.

● As more currencies are created and find success, there will be
more variety for investors.
● A rise in the legitimacy of cryptocurrency is likely to lead to a rise
in innovative uses for coins.
● Cryptocurrencies are more likely to be widely accepted as a method
of payment in the future.
● More coins are also likely to become legitimate forms of payment,
in addition to Bitcoin.
● It is likely that legislation in coming years will decrease the level
of anonymity offered by digital currencies.
● The number of initial coin offerings could rise or fall in future years
depending on whether more countries decide to legislate against
them.
● The rise of cryptocurrencies may drive technological
advances.Already Ripple is being used to facilitate speedy and secure
financial transactions, thanks to the developer’s desire to improve on
the blockchain technology behind Bitcoin.
● Analysts estimate that the global cryptocurrency market will more
than triple by 2030, hitting a valuation of nearly $5 billion. Revenue in
the Cryptocurrencies market is projected to reach US$51.5bn in
2024.
● Revenue is expected to show an annual growth rate (CAGR 2024-
2028) of 8.62% resulting in a projected total amount of US$71.7bn by
2028.
● The average revenue per user in the Cryptocurrencies market
amounts to US$61.8 in 2024.
● From a global comparison perspective it is shown that the
highest revenue is reached in the United States (US$23,220.0m
in 2024).
● In the Cryptocurrencies market, the number of users is expected
to amount to 992.50m users by 2028.
● User penetration will be 13.88% in 2024 and is expected to hit
15.88% by 2028.
 How can Zebpay make most of it future?

The cryptocurrency market's impact on exchanges and platforms will be

shaped by technological advancements, regulatory developments,
market dynamics, and evolving user preferences. Adaptation to these
changes will be crucial for the long-term success of exchanges and
platforms in
the crypto ecosystem.

The cryptocurrency market's impact on Zebay in the future is expected

to be significant across several dimensions:

● Market Expansion: As cryptocurrencies gain wider acceptance, the

number of users and investors participating in the market is likely to
increase. This will drive up trading volumes on exchanges and
increase the demand for diverse crypto-related services on platforms.
● Regulation: Regulatory developments will play a crucial role.
Increased regulatory clarity could lead to more institutional adoption
and trust, while stricter regulations could impose compliance costs and
change operating dynamics for exchanges and platforms.
● Technological Innovation: Crypto platforms will continue to innovate to
cater to evolving market needs. This includes advancements in
trading interfaces, security protocols, and blockchain technologies,
influencing user experience and operational efficiency.
● Global Integration: Cryptocurrencies operate globally, impacting
exchanges to offer multi-currency support and expand their
geographical reach. This global integration also exposes platforms to
geopolitical and economic factors affecting different regions.
● Financial Services Integration: Integration with traditional
financial services like banking and payment processing will
become more
 prevalent. This can enhance liquidity and accessibility but may
also subject platforms to traditional financial regulations.
● Security and Trust: Security remains a paramount concern. Exchanges
and platforms will need to continuously invest in robust security
measures to protect assets and maintain user trust amid evolving
cyber threats.
● DeFi and Decentralization: The rise of decentralized finance
(DeFi) introduces new models where users interact directly with
protocols
rather than centralized entities. This challenges traditional exchanges
by offering greater user control and potentially reducing fees.
● User Experience: Platforms will focus on improving user interfaces,
customer support, and educational resources to attract and retain
users amidst growing competition.

Overall, the cryptocurrency market's impact on exchanges and platforms

will be shaped by technological advancements, regulatory
developments, market dynamics, and evolving user preferences.
Adaptation to these changes will be crucial for the long-term success of
exchanges and platforms in the crypto ecosystem.

With over 5.5 million users as of 2024, ZebPay offers a user-friendly trading
experience, including lightning network payments and zero deposit fees, making it
a formidable player in the crypto industry.

Key features
● Lending: Earn fixed interest at 4% by lending crypto.
● No Deposit Fee: ZebPay charges zero fees for deposits.
 ● Lightning Network Payments: Supports lightning network for faster
and cheaper transactions.
● Zero Trading Fees: Select pairs have zero trading fees.

Regulatory Compliance
● Mandatory KYC verification
● AML policy

Minimum Investment
● INR 100

Payment Methods
● NEFT, IMPS, and RTGS

Trading and Other Fees

● Monthly wallet fee of 0.0001 BTC + GST (18%)
● Maker Fees: 0.10% - 0.15%
● Taker Fees: 0.15% - 0.25%
● Intraday Fees: 0.08% - 0.10%

Security
● $100M Insurance with BitGo
● Chainalysis Partnership for Transaction Integrity
● AML Policy Implemented
● Mandatory KYC for All Users

Why Is This Among The Best

ZebPay is one of the best choices for investors who prefer platforms with the
lowest trading costs for stablecoins and other cryptocurrencies.

Tools Available
● TaxNodes: Crypto Tax Calculation Tool
● Basic market charts
● News and updates
● Basic education resources

Positive’s
 ● Access to Lightning network payments
● High returns on crypto lending
● Zero deposit and trading fees applicable to specific
pairs
● No charges for fiat withdrawals

Areas of Improvement

● Introducing options for margin and future trading

● By adding a real-time chat box option