SEMINAR REPORT

On

“CRYPTOCURRENCY”
In partial fulfillment of the requirements
for the award of the Degree of
Bachelor of Computer Applications
(Ⅵ SEMESTER)
DONE BY

GOKUL D (Reg No:170021098574)

Under the guidance of

Miss. Jasmine Mathew

(Asst. Professor)

ST JOSEPH’S ACADEMY OF HIGHER

EDUCATION AND RESEARCH
MOOLAMATTOM
(Affiliated to Mahatma Gandhi University, Kottayam)
 ST JOSEPH’S ACADEMY OF HIGHER
EDUCATION AND RESEARCH
(Affiliated to Mahatma Gandhi University, Kottayam)

Department of Computer Science

CERTIFICATE
Certified that this is a bonafide report on the Seminar entitled “CRYPTO
CURRENCY” for St. Joseph’s Academy of Higher Education and Research,

Moolamattom done by GOKUL D (Reg No:170021098574) during the

year 2017-2020 in partial fulfilment of requirements for the award of the
degree of Bachelor of Computer Application of Mahatma Gandhi
University, Kottayam, Kerala.

Principal Head of the Department Guide

 ACKNOWLEDGEMENT

I give all the honour and praise to the lord who gave I wisdom and enabled I to complete
this seminar successfully.

I express my sincere and heartful thanks to respect Dr.R Binoy our beloved Principle
for providing necessary facilities for the completion of my seminar successfully.

I thank profusely Mr. Geo Kurian, Head, Department of Computer Science for his
guidance and inspiration throughout my course of study.

I express my sincere gratitude to my seminar guide Mrs. Jasmine Mathew, Assistant

professor, for the valuable advices and guidance throughout the completion of the
seminar.

I also express my gratitude and thanks to all my teachers and friends for their sincere
and friendly cooperation in the successful completion my seminar.

By,
Gokul D
 CONTENTS

1. INTRODUCTION 5

2. WHAT IS INRFALCON 9

3. HOW CRYPTOCURRENCY WORKS? 11

4. DARKNET MARKET 15

5. THE ANATOMY OF CRYPTOCURRENCY 17

6. HISTORY 21

7. ADVANTAGES 23

8. DISADVANTAGES 25

9. APPLICATIONS 27

10. REFERENCE 32

11. CONCLUSION 34
INTRODUCTION
Cryptocurrency Page |6

1.CRYPTOCURRENCY

What is a cryptocurrency?

Cryptocurrency is a form of digital money that is designed to be secure and, in many

cases, anonymous. It is a currency associated with the internet that uses cryptography,
the process of converting legible information into an almost uncrackable code, to track
purchases and transfers. Cryptography was born out of the need for secure
communication in the Second World War. It has evolved in the digital era with elements
of mathematical theory and computer science to become a way to secure
communications, information and money online. The list of cryptocurrency according
to the year 2009 to 2017. Bitcoin, litecoin, Namecoin, Swiftcoin, Teracoin, Peercoin,
Dogecoin, Emercoin, Gridcoin, omni, primecoin, Ripple, Auroracoin, Blackcoin,
Burstcoin, Coinye, Dash, Digitalnote , Mazacoin, Monero, Nem, Nxt,potcoin, Synerio-
AMP, Titcoin, Vertcoin, Ethereum, Etherium Classic, IOTA, SixEleven, Decred,
Waves Platform, Zcash,Ark Ecosystem, Bitcoin Cash, Ubiq etc. The first

Department of computer science SAHER, Moolamattom

Cryptocurrency Page |7

cryptocurrency was bitcoin, which was created in 2009 and is still the best known.
There has been a proliferation of crypto currencies in the past decade and there are now
more than 900 available on the internet.

What is bit coin?

A digital currency, used to make payments of any value without fees. It runs on the
blockchain, a decentralised ledger kept running by “miners” whose powerful computers
crunch transactions and are rewarded in bitcoins. Satoshi Nakamoto, a secretive internet
user, invented bitcoin in 2008 before it went online in 2009. India may launch its own.

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Cryptocurrency Page |8

INDIA MAY LAUNCH ITS OWN

CRYPTOCURRENCY
The Indian government is reportedly considering introducing its own digital
cryptocurrency, similar to bitcoin. With the rising popularity of bitcoin in all financial
markets, the government is now looking at a government-issued digital currency.
India’s central bank believes that digital currencies are susceptible to misuse, and hence
chose to issue one themselves. This cryptocurrency will fall under the domain of the
Reserve Bank of India (RBI). According to Business Standard, the cryptocurrency will
be codenamed ‘Lakshmi’ — after the Goddess of wealth. If introduced, Lakshmi should
run on an implementation of the blockchain technology used by Bitcoin itself.

Department of computer science SAHER, Moolamattom

WHAT IS INRFALCON
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2.What is INRFalcon?
INRFalcon is a smart contract built on the Ethereum platform. It is an intermediary
currency that combines the benefits of cryptocurrency and the stability of fiat (i.e. any
government issued currency). INRFalcon is a closed cryptocurrency existing only on
ThroughBit, it cannot be sent to any other wallet. It has to be noted that-

 1 Indian Rupee falcon (INRF) = 1 Indian Rupee (INR)

How cryptocurrency works? The Cryptocurrency Basics Public Ledgers: All confirmed
transactions from the start of a cryp

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HOW CRYPTOCURRENCY
WORKS?
Cryptocurrency P a g e | 12

3.How cryptocurrency works?

The Cryptocurrency Basics

Public Ledgers: All confirmed transactions from the start of a cryptocurrency’s

creation are stored in a public ledger. The identities of the coin owners are encrypted,
and the system uses other cryptographic techniques to ensure the legitimacy of record
keeping. The ledger ensures that corresponding “digital wallets” can calculate an
accurate spendable balance. Also, new transactions can be checked to ensure that each
transaction uses only coins currently owned by the spender. Bitcoin calls this public
ledger a “transaction block chain.”

(1) To be able to send money, you have to set up a wallet. The account and the idea
behind it are similar to a well-known online bank account. You can see your balance,
choose an amount you want to transfer, enter the recipient’s details and click ‘Send’.

(2) After you click ‘Send’, a message with your and recipient’s details will be sent to a
particular cryptocurrency network. This prevents theft, and previously mentioned,
double spending.

(3) If you have an online bank account then you know that before you make a transfer
or a payment, you have entered a PIN code or use a digital security key. Same thing
works for cryptocurrency – underneath a message, you have to include your signature.

Except, the signature is not based on handwriting but a mathematical formula. The math
behind a signature comes from the word ‘cryptography’ – an art of hiding. Normally
used to hide secret messages, but in transferring cryptocurrencies is used to prove the
signature’s authenticity. Clever, right? What’s more – each user has a private key which
is used to encrypt the signature!

(4) All confirmed transactions from the beginning of cryptocurrency are stored in a
public ledger. The ledger ensures the accurate spendable balance, and that each
transaction uses only coins that already belong to the spender. Again, that’s all to avoid
theft and double spending.

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Cryptocurrency P a g e | 13

Transactions: A transfer of funds between two digital wallets is called a transaction.

That transaction gets submitted to a public ledger and awaits confirmation. When a
transaction is made, wallets use an encrypted electronic signature (an encrypted piece
of data called a cryptographic signature) to provide a mathematical proof that the
transaction is coming from the owner of the wallet. The confirmation process takes a
bit of time (ten minutes for bitcoin) while “miners” mine (ie. confirm transactions and
add them to the public ledger).

Mining: In simple terms, mining is the process of confirming transactions and adding
them to a public ledger. In order to add a transaction to the ledger, the “miner” must
solve an increasingly-complex computational problem (sort of like a mathematical
puzzle). Mining is open source, so anyone can confirm the transaction. The first
“miner” to solve the puzzle adds a “block” of transactions to the ledger. The way in
which transactions, blocks, and the public blockchain ledger work together ensures that
no one individual can easily add or change a block at will. Once a block is added to the
ledger, all correlating transactions are permanent and a small transaction fee is added
to the miner’s wallet (along with newly created coins). The mining process is what
gives value to the coins and is known as a proof-of-work system.

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Cryptocurrency P a g e | 14

Department of computer science SAHER, Moolamattom

DARKNET MARKET
Cryptocurrency P a g e | 16

4.DARKNET MARKET
Cryptocurrency is also used in controversial settings in the form of online black
markets, such as Silk Road. The original Silk Road was shut down in October 2013 and
there have been two more versions in use since then; the current version being Silk
Road 3.0. The successful format of Silk Road has been widely used in online dark
markets, which has led to a subsequent decentralization of the online dark market. In
the year following the initial shutdown of Silk Road, the number of prominent dark
markets increased from four to twelve, while the amount of drug listings increased from
18,000 to 32,000.

Darknet markets present growing challenges in regard to legality.

Bitcoins and other forms of cryptocurrency used in dark markets are not clearly or
legally classified in almost all parts of the world. In the U.S., bitcoins are labelled as
"virtual assets". This type of ambiguous classification puts mounting pressure on law
enforcement agencies around the world to adapt to the shifting drug trade of dark
markets.

STUDIES

In September 2015, the establishment of the peer-reviewed academic journal Ledger

(ISSN2379-5980) was announced. It will cover studies of cryptocurrencies and related
technologies, and is published by the University of Pittsburgh. The journal encourages
authors to digitally sign a file hash of submitted papers, which will then be timestamped
into the bitcoin blockchain. Authors are also asked to include a personal bitcoin address
in the first page of their papers.

Department of computer science SAHER, Moolamattom

THE ANATOMY OF
CRYPTOCURRENCY
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5.The Anatomy of Cryptocurrency

Although there can be exceptions to the rule, there are a number of factors(beyond the
basics above) that make cryptocurrency so different from the financial systems of the
past:

Adaptive Scaling: Adaptive scaling essentially means that cryptocurrencies are built
with a number of measures to ensure that they will work well in both large or small
scales.

Adaptive Scaling Example: Bitcoin is programmed to allow for one transaction block
to be mined approximately every ten minutes. The algorithm adjusts after every 2016
blocks (theoretically, that’s every two weeks) to get easier or harder based on how long
it actually took for those 2016 blocks to be mined. So if it only took 13 days for the
network to mine 2016 blocks, that means it’s too easy to mine, so the difficulty
increases. However, if it takes 15 days for the network to mine 2016 blocks, that shows
that it’s too hard to mind, so the difficulty decreases.

A number of other measures are included in digital coins to allow

for adaptive scaling including limiting the supply overtime (to create scarcity) and
reducing the reward for mining as more total coins are mined.

Cryptographic: Cryptocurrency uses a system of cryptography (AKA encryption) to

control the creation of coins and to verify transactions.

Decentralized: Most currencies in circulation are controlled by a centralized

government, and thus their creation can be regulated by a third party. Cryptocurrency’s
creation and transactions are open source, controlled by code, and rely on “peer-to-
peer” networks. There is no single entity that can affect the currency.

Digital: Traditional currency is defined by a physical object (USD representing gold

for example), but cryptocurrency is all digital. Digital coins are stored in digital wallets
and transferred digitally to other peoples’ digital wallets. No physical object ever exists.

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Cryptocurrency P a g e | 19

Open Source: Cryptocurrencies are typically open source. That means that developers
can create APIs without paying a fee and anyone can use or join the network.

Proof-of-work: Most cryptocurrencies use a proof-of-work system. A proof-ofwork

scheme uses a hard-to-compute but easy-to-verify computational puzzle to limit
exploitation of cryptocurrency mining. Essentially, it’s like a really hard to solve
“catpcha” that requires lots of computing power. NOTE: Other systems like proof-of-
work (such as proof-of-stake) are also used.

Pseudonymity: Owners of cryptocurrency keep their digital coins in an encrypted

digital wallet. A coin-holder’s identification is stored in an encrypted address that they
have control over – it is not attached to a person’s identity. The connection between
you and your coins is pseudonymous rather than anonymous as ledgers are open to the
public (and thus, the ledgers could be used to glean information about groups of
individuals in the network).

Value: For something to be an effective currency, it has to have value. The US dollar
used to represent actual gold. The gold was scarce and required work to mine and refine,
so the scarcity and work gave the gold value. This, in turn, gave the US dollar value.

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Cryptocurrency P a g e | 20

Department of computer science SAHER, Moolamattom

HISTORY
Cryptocurrency P a g e | 22

6.HISTORY
In 1998, Wei Dai published a description of "b-money", an anonymous, distributed
electronic cash system. Shortly thereafter, Nick Szabo created "bit gold".[20] Like
bitcoin and other cryptocurrencies that would follow it, bit gold was an electronic
currency system which required users to complete a proof of work function with
solutions being cryptographically. A currency system based on a reusable proof of work
was later created by Hal Finney who followed the work of Dai and Szabo.

The first cryptocurrency was created in 2009 by SATOSHI NAKAMOTO.

It used SHA-256, a cryptographic hash function. In April 2011, Namecoin was created
as an attempt at forming a decentralized DNS, which would make internet censorship
very difficult. Soon after, in October 2011, Litecoin was released. It was the first
successful cryptocurrency to use scrypt as its hash function instead of SHA-256.
Another notable cryptocurrency, Peercoin was the first to use a proof-of-work/proof-
of-stake hybrid.[22] IOTA was the first cryptocurrency not based on a blockchain, and
instead uses the Tangle. Many other cryptocurrencies have been created though few
have been successful, as they have brought little in the way of technical innovation.

Department of computer science SAHER, Moolamattom

ADVANTAGES
Cryptocurrency P a g e | 24

7.What are the advantages of cryptocurrency?

Digital currency maintains its users complete anonymity. When you make a purchase
with traditional money your personal information is attached to each and every
transaction which can be used to track you and take note of your purchases. But
cryptocurrency transactions carry no personal information.

Cryptocurrencies aren't directly linked to the laws, rules or regulations of any

government, corporation or bank. Hence, the interest rates, fees and surcharges that you
may have to pay on your bank account or credit card do not effect your transactions or
cryptocurrency in any manner.

Accounts that hold traditional currency can be garnished or frozen completely.

cryptocurrencies, on the other hand, are not stored in traditional banks.

 Fraud-cryptocurrency are digital and cannot be counterfeited as with credit card

charge backs.

 Identity theft

 Immediate settlement

 Access to everyone

 Lower fees

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DISADVANTAGES
Cryptocurrency P a g e | 26

8.Disadvantages of cryptocurrency?

Cryptocurrencies are difficult for people to understand, and the mechanics of key
management confuse people, which means that many people have purchased
cryptocurrencies and left them in the custody of others, only to lose them to insider theft
or hackers. The cryptocurrency space is new, disruptive, and subject to a lot of pump
and dump behaviors similar to penny stocks. Because nobody knows what currencies
will be adopted at scale, and there is so much uncertainty about what people will use
them for, all cryptocurrencies are extremely volatile relative to traditional fiat
currencies.

 Bitcoins are not widely accepted.

 Wallet can be lost, when hard drive crash or when we loose device.

 Risk of unknown technical flaws.

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APPLICATIONS
Cryptocurrency P a g e | 28

9.APPLICATIONS

1. Low-cost money transfers

The most well-known benefit of cryptocurrencies is their ability to send and receive
payments at a low cost and at a high speed. For example, a recent $99 million litecoin
(LTC) transaction took only two and a half minutes to process and cost the sender only
$0.40 in transaction fees. If this money transfer had gone through a financial
intermediary the fees would have been much, much higher and the transfer would have
taken several days, or longer if this was a cross-border transaction.

The low fees associated with transactions using digital currencies such as litecoin
(LTC), stellar (XLM) or bitcoin cash (BCH) make them excellent payment systems for
international money transfers.

2. A censorship-resistant alternative store of wealth

While you probably don’t think your bank account and assets could be frozen, the
reality is that this occurs more often than people realise — especially in jurisdictions
with dubious rule of law. All it can take is for someone to be accused of financial
misconduct or making powerful enemies. When that happens, people can find
themselves with little to no access to cash, even if they’ve done nothing wrong.

This is where one of the most unique and powerful uses of crypto comes into play.
Cryptocurrencies, such as bitcoin, act as a censorship-resistant alternative store of
wealth that only the individual with the private keys to the wallet has access to. Hence,
no personal bitcoin wallet can ever be frozen by the authorities.

3. Invest in innovative early-stage startups

The emergence of digital token-based fundraising has allowed anyone with an Internet
connection to become an investor in innovative early-stage tech startups, while at the
same time providing new startup ventures with much-needed seed capital.

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Cryptocurrency P a g e | 29

Initial coin offerings (ICOs) are a new form of fundraising that provides startups with
the opportunity to raise capital by selling a newly-created digital token to early backers
of the project in exchange for established cryptocurrencies such as bitcoin (BTC) or
ether (ETH). The price of the newly-issued token then acts as proxy linked to the
success or failure of said startup once it starts to trade in the secondary market.

In the past, access to these deals would have only been available to experienced venture
capitalists, but the advent of cryptocurrency has opened these opportunities up to a
much broader spectrum of investors.

In some cases the digital tokens of the most successful ICOs have increased in value by
several thousand percent and cryptocurrency-based fundraising has helped startups to
raise over $12 billion in the past 18 months.

4. Make private transactions

Privacy-centric digital currrencies such as Monero (XMR), Zcash (ZEC), and PIVX
(PIVX) enable users to make anonymous financial transactions.

That means individuals can make money transfers without having to explain to a bank
why they are sending a large sum of money, what the sources of the funds are and who
they are sending it to, which can delay the transaction and involve unnecessarily
bureaucratic processes.

5. Send non-cash remittances

Another powerful use case for cryptocurrencies is non-cash remittances. Nigerian

blockchain startup SureRemit, for example, enables its users to send non-cash
remittances from anywhere in the world to selected African nations.

Diaspora Africans can purchase SureRemit’s native RMT tokens, which are then used
within the SureRemit app to make non-cash remittances such as mobile data top-ups or
utility bill payments for their relatives in Africa.

SureRemit raised $7 million during its initial coin offering in December 2017 and plans
on using this money to improve its platform and expand into new markets.

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Cryptocurrency P a g e | 30

6. Get paid to post content

The world’s first incentivized social media and blogging platform, Steemit, enables
publishers to receive financial rewards in the form of cryptocurrency for posting content
and for curating on the network by upvoting high-quality content.

Steemit financially empowers its users by rewarding them for contributing to the
platform as opposed to taking its users data and selling it to third-parties like Facebook
does. For this reason, Steemit has become particularly popular in emerging
markets where it boasts a high number of users.

7. Rent out your spare hard drive space to the cloud

Decentralized blockchain-based cloud storage solutions such as Storj enable users to

earn cryptocurrency in exchange for renting out their hard drive storage space to those
who need it on a peer-to-peer basis.

“Storj can be faster, cheaper, and more secure than traditional cloud storage platforms.
Faster because multiple machines are serving you your file simultaneously, cheaper
because you are renting people's spare hard-drive space instead of paying for a purpose-
built data center, and more secure because your file is both encrypted and shredded.
There is no need to trust a corporation, vulnerable servers, or employees with your files.
Storj completely removes trust from the equation,” the company states on its website.

Storj and other decentralized cloud storage solutions, such as Siacoin and Filecoin, not
only provide a cheaper and more secure alternative to existing corporate cloud storage
platforms but also provide users with a new revenue stream.

8. Travel the world

Due to the explosive growth of the cryptocurrency ecosystem in the past nine years, it
is now possible to travel the world by spending cryptocurrency.

Established travel agents such as CheapAir and Destinia accept bitcoin as a payment
method to book flights, car rentals, and hotels and for those who prefer to stay in an
apartment when traveling can book accommodation using bitcoin (BTC) or ether (ETH)
on CryptoCribs.

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Cryptocurrency P a g e | 31

The growth of the bitcoin ATM market also means travelers are now able to convert
their cryptocurrency into local currency in most major cities around the world.

9. Travel into space

Richard Branson’s commercial space travel company, Virgin Galactic, announced in

November 2013 that is accepting bitcoin payments for space travel bookings.

While the California-based company has not yet managed to successfully launch a
commercial space flight, several future astronauts have already paid for their tickets —
worth $250,000 — in bitcoin, including bitcoin advocates Cameron and Tyler
Winklevoss.

10. Buy a lambo

Last but not least, you can also use your cryptocurrency to buy a Lamborghini. The
bitcoin luxury marketplace De Louvois enables the “crypto rich” to purchase sports
cars including the cryptocurrency community’s favorite status symbol, the
Lamborghini, using bitcoin.

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REFERENCE
Cryptocurrency P a g e | 33

10.REFERENCE

 www.google.com
 www.wikipedia.org
 www.see

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CONCLUSION
Cryptocurrency P a g e | 35

11.Conclusion
The market of cryptocurrencies is fast and wild. Nearly every day new cryptocurrencies
emerge, old die, early adopters get wealthy and investors lose money. Every
cryptocurrency comes with a promise, mostly a big story to turn the world around. Few
survive the first months, and most are pumped and dumped by speculators and live on
as zombie coins until the last bagholder loses hope ever to see a return on his
investment.
Markets are dirty. But this doesn‘t change the fact that cryptocurrencies are here to stay
– and here to change the world. This is already happening. People all over the world
buy Bitcoin to protect themselves against the devaluation of their national currency.
Mostly in Asia, a vivid market for Bitcoin remittance has emerged, and the Bitcoin
using darknets of cybercrime are flourishing. More and more companies discover the
power of Smart Contracts or token on Ethereum, the first real-world application of
blockchain technologies emerge.
The revolution is already happening. Institutional investors start to buy
cryptocurrencies. Banks and governments realize that this invention has the potential
to draw their control away. Cryptocurrencies change the world. Step by step. You can
either stand beside and observe – or you can become part of history in the making.

Department of computer science SAHER, Moolamattom