Contents

LETTER OF APPRECIATION...................................................................................................I
LETTER OF APPROVAL..........................................................................................................II
ABSTRACT................................................................................................................................III
ACKNOWLEDGEMENT..........................................................................................................IV
1. INTRODUCTION TO CRYPTOCURRENCY..................................................................1
1.1 Introduction...................................................................................................................1
What is cryptography?.............................................................................................................1
1.2 Objectives of Study...............................................................................................................2
1.3 Scope and limitations...........................................................................................................2
1.4 Methodology of Study..........................................................................................................3
2. Review of Crypto currency...................................................................................................3
2.1 Introduction..........................................................................................................................3
2.2 Features of Crypto currency.................................................................................................3
2.3 Service Provided by Crypto currency...................................................................................4
4. SWOT Analysis.........................................................................................................................7
Strength.......................................................................................................................................7
Weakness...................................................................................................................................7
Opportunities...............................................................................................................................8
Threat........................................................................................................................................8
5 Data Presentation and Analysis................................................................................................9
6 Conclusion and Suggestion......................................................................................................13

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List of Abbreviations

II
 1. INTRODUCTION TO CRYPTOCURRENCY
1.1 Introduction.
What is cryptography?
Cryptography is a practice and study of techniques for secure communication in presence
of adversarial behavior. Cryptography prior to the modern age was effectively
synonymous with encryption, converting information from a reactable state to
unintelligible nonsense.

Modern cryptography is heavily based on mathematical theory and computer based

science practice; cryptographic algorithms are deign among computational hardness
assumption , making such algorithms hard to break in actual practice by any adversary.
While it is theoretically possible to break into a well design system, it is infeasible in
actual practice to do so.

A crypto currency is an encrypted data string that denotes a unit of currency. It is

monitored and organized by a peer-to-peer network called a blockchain, which also
serves as a secure ledger of transactions, e.g., buying, selling, and transferring. Unlike
physical money, cryptocurrencies are decentralized, which means they are not issued by
governments or other financial institutions. 

In 1983, the American cryptographer David Chaun conceived an anonymolus cypto

graphic electronic money called ecash. Later , in 1995, he implemented it through
Digicash , an electronic form of cryptographic electronic payment.

In the year 2008, Satoshi Nakamoto introduced cryptocurrency to the much wider
audience, initiating its rise to popularity. The paper : bitcoin: a peer to peer electronic
cash system, describe the use of peer to peer network as a solution to the problem of
double spending.

Cryptocurrencies are created (and secured) through cryptographic algorithms that

are maintained and confirmed in a process called mining, where a network of computers
or specialized hardware such as application-specific integrated circuits (ASICs) process
and validate the transactions. The process incentivizes the miners who run the network
with the cryptocurrency.

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 Bitcoin, Ether, Litecoin, and Monero are popular cryptocurrencies. 

1.2 Objectives of Study

The main objective of this is to find out the possibilities of using and mining the
cryptocurrency. The possibilities replacing cash money with crypto currency and
the laws necessary for managing the use of crypto currency for the formulation of
tax based rules.

1.3 Scope and limitations

Scope:

 As per studies, the crypto currency adoption of the crypto currency

market has increased by over 880% between June 2020 to June
2021 worldwide.
 If we talk about the statistics in India then you will be surprised to
know that within a year the nation has experienced a growth of
about 400%.

Limitations:

 If companies or consumers move to a new crypto currency from

you or stop using digital currencies entirely, it could lose value and
become worthless.
  Crypto currency exchanges are vulnerable to cyber attacks, which
could lead to an irreparable loss of your investment. 
 Crypto currency can be vulnerable to scams.

1.4 Methodology of Study

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Secondary Research: We dig some information from internet, our course book
ecommerce, magazine, articles and collect the appropriate information.

2. Review of Crypto currency

2.1 Introduction

Crypto currency is trillion-dollar industry globally. Many big bank and

billionaires have already invested in crypto. No democracy globally have banned crypto
currency, something which is decentralised cannot be banned. Crypto and Bitcoin
sounds like complex concepts but millions of people in India are making money by
buying and selling cryptocurrencies.

2.2 Features of Crypto currency

1. Peer to peer – Crypto currency uses a peer-to-peer system in which, users are
allowed to send transactions to one another without using an intermediary unlike in a
traditional banking system.

2. Public - Each person using crypto currency has access to a digital, public
record (ledger) of all transactions the source and destination can be seen on the respective
explorers of the currency.

3. No centre server - The peer-to-peer system eliminates the need for a central
server or a central authority to track money going in and out as is used in traditional
currency. Crypto currency uses a decentralized network of computers or nodes. Each
node maintains a copy of the ledger (block chain).

2.3 Service Provided by Crypto currency

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It's a peer-to-peer system that can enable anyone anywhere to send and receive payments.
Instead of being physical money carried around and exchanged in the real world, crypto
currency payments exist purely as digital entries to an online database describing specific
transactions.

3. Transaction Process of Crypto currency

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Once a transaction is complete, a person called a miner will verify that the transaction is
legitimate, which involves solving a cryptography puzzle to ensure that no one is
spending money they do not have. The system runs on consensus, meaning that once a
consensus of at least 51% agrees that a transaction is valid, it is confirmed. A miner can
be anyone, provided they have the proper high-end computer equipment. The miner will
receive a transaction fee for completing this work.

Now let’s see how a transaction takes place. To complete a cryptocurrency transaction,
users need a public and private key.
 The public key is equivalent to an account number.
 The private key is like a PIN or password that allows the user to spend their crypto
currency.
Public and private keys are comprised of a long string of numbers and letters.
Public Key Like an account number, this is visible to anyone with Internet access when
transactions are added to the block chain.

Protecting the Private Key

To protect crypto currency, users must protect their private keys. Phishing and malware
can be used to steal private keys. If a private key is stored on a device with Internet
access, the user is at greater risk of crypto currency theft.
Note: LEAs should be aware of scam coins. A developer may create a new currency and
offer investors an opportunity to “get rich quick.” But in reality, they use this scheme to
take advantage of novice investors.
Users can store their public and private keys in a variety of digital and non-digital
wallets; most users will use a digital wallet.
Using a wallet is vital for crypto currency users because it allows them to store their
private keys in a safe place. Though it is important to keep track of your electronic wallet,
there is a backup should something happen to it. This is called a recovery seed.

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Recovery Seed
A recovery seed is a unique and random series of words that are recorded when
establishing an electronic wallet. If the wallet is misplaced, damaged, lost, or stolen, the
recovery seed allows you to regenerate the wallet, including the public and private key.

4. SWOT Analysis

Strength
 to create it a feasible money that has upgraded its position throughout the long
term, remarkably the fixed limit of Bitcoin that will exist.

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 This part of Bitcoin is significant for its worth.
 Bitcoin will never became enlarged because of its restricted amount of Bitcoin
numbers. Likewise, Bitcoin and other digital currencies are commonly viewed
as being shielded from expansion beginning from public government changes or
limitations . This creates a "secure paradise" for financial specialists to place
their prosperity into, as it does not lose esteem dependent on expansion. Bitcoin is
swiftly exhibiting its power as a safety against expanding public monetary
 forms. Notwithstanding, similar to the case with stocks, the value can change
fiercely depends on numerous outer elements. The mixture of interest for a secure
paradise alternative and its cost instability assisted Bitcoin with turning into the
optimum acting money of 2015 utilizing the US Dollar Index. This entails that
Bitcoin was the utmost elevated
 esteemed money globally towards the finish of a year.

Weakness
 Bitcoin also has interior faults which are important for its structure and cannot
be changed easily.
 Record of public, or blockchain, intends that each customer can view every
exchange.
 There is semi- confidentiality , in that the buyers of Bitcoin purse cannot be
characterised altogether
 The public block chain is divided between all end-users, which intends that
it is helpless to onslaught due to comfortable access.
 Bitcoin structure: is the organization cannot administer with a high pressure of
exchange rates.

Opportunities
 Digital currencies is in an extraordinary location as a precursor in a by-chance
performative information technology to long standing monetary procedures.
 Performative information advances start by resolving an exceptional event in an
organization.

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  Crypto-currencies are handy to help repair the events distinguished with bank
less shoppers

Threat
 The price changes that epidemic digital currency keep end-user and investors in
doubt. Eventually a restricting component in digital currency is common approval.
 Price changes decrease faith that a buyer's price will be adhered on a daily
interval, constraining trust in the monetary forms generally worth.
 The scarcity of main possession of crypto-currencies for implies that any effort to
repair this marketing issue with the use of promotions can hypothetically help the
providing organization's opposition.

5 Data Presentation and Analysis

Bitcoin (BTC)

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Bitcoin, launched in 2009, was the first of a new kind of asset called cryptocurrency,
a decentralized form of digital cash that eliminates the need for traditional
intermediaries like banks and governments to make financial transactions.  Bitcoin
is powered through a combination of peer-to-peer technology network of individuals,
much like the volunteer editors who create Wikipedia — and software-driven
cryptography, the science of passing secret information that can only be read by the
sender and receiver.

Ethereum (ETH)
Ethereum is a decentralized software platform that enables Smart Contracts and
Decentralized Applications (DApps) to be built and run without any downtime, fraud,
control, or interference from a third party.  The goal behind Ethereum is to create a
decentralized suite of financial products that anyone in the world can have free access
to, regardless of nationality, ethnicity, or faith.  In 2021 Ethereum plans to change
its consensus algorithm from proof-of-work to proof-of-stake. This move will allow
Ethereum’s network to run itself with far less energy as well as improved transaction
speed.

Binance Coin (BNB)

Binance Coin is a utility cryptocurrency that operates as a payment method for the
fees associated with trading on the Binance Exchange. Those who use the token as a
means of payment for the exchange can trade at a discount. Binance Coin’s
blockchain is also the platform that Binance’s decentralized exchange operates on.
The Binance exchange was founded by Changpeng Zhao and the exchange is one of
the most widely used exchanges in the world based on trading volumes. Bureau of
Police Research & Development, New Delhi 8

Litecoin (LTC)
Litecoin, launched in 2011, was among the first cryptocurrencies to follow in the
footsteps of Bitcoin and has often been referred to as “silver to Bitcoin’s gold.” It was
created by Charlie Lee, an MIT graduate, and former Google engineer.  Litecoin is
based on an open-source global payment network that is not controlled by any central

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authority and uses “scrypt” as a proof of work, which can be decoded with the help of
CPUs of consumer-grade. Although Litecoin is like Bitcoin in many ways, it has a
faster block generation rate and hence offers a faster transaction confirmation time.

Dash (DASH)
Dash (Symbol: DASH) was created in January 2014 to be the most user-friendly and
scalable cryptocurrency. Formerly known as Xcoin and Darkcoin, it was designed to
protect the anonymity of its users while also facilitating almost instant transactions.
Dash was designed to improve on Bitcoin’s perceived flaws, especially in terms of
transaction times and privacy. Dash’s creators view it as being the next logical step
towards fully digital cash

. Ripple (XRP)
While Bitcoin is a digital currency intended as a means of payment for goods and
services, Ripple is a payment settling, currency exchange, and remittance system
intended for banks and payment networks. The idea is to provide a system for direct
transfer of assets (e.g. money, gold, etc.) Transactions are settled within seconds on
the Ripple network even though the platform handles millions of transactions
frequently. As of August 2019, Ripple was the third-largest cryptocurrency by market
cap of $13.37 billion, following Bitcoin (BTC) at $205.03 billion, and Ethereum
(ETH) at $24.18 billion

Monero (XMR)
Monero is a secure, private, and untraceable currency. This open-source
cryptocurrency was launched in April 2014 and soon garnered great interest among
the cryptography community and enthusiasts. The development of this cryptocurrency
is completely donation-based and community-driven. Monero has been launched with
a strong focus on decentralization and scalability, and it enables complete privacy by
using a special technique called “ring signatures.” SoP on Investigation
Process/Methodologies for Cryptocurrency related Cyber Crimes 9

Cardano ADA

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 Cardano is a Switzerland-based Cryptocurrency launched on 27 September 2017.
Cardano was developed with the idea to run a Public Blockchain platform for smart
contracts. Cardano’s internal currency is called Ada

. Polkadot
Polkadot is a heterogeneous multi-chain interchange and translation architecture that
enables customized sidechains to connect with public blockchains. Polkadot’s first
token went on sale on 27 October 2017

Tether
It is not bitcoin or ether, but tether which is the most traded cryptocurrency today.
Commonly denominated as USDT, the tether is a stable currency, which can be
redeemed for a dollar. In other words, if one holds 100 USDT, they can redeem it for
$100. It was founded in 2014

Uniswap
Uniswap is a decentralized finance protocol that is used to exchange
cryptocurrencies. Uniswap aims to keep token trading automated and completely open
to anyone who holds tokens while improving the efficiency of trading versus that on
traditional exchanges.

Chainlink
Chainlink (LINK) is a decentralized oracle network that aims to connect smart
contracts with data from the real world. Chainlink was developed by Sergey Nazarov,
with Steve Ellis as the other co-founder.

Bitcoin Cash
Bitcoin Cash is a peer-to-peer electronic cash system that aims to become sound
global money with fast payments, micro fees, privacy, and high transaction capacity
(big blocks). In the same way that physical money, such as a dollar bill, is handed
directly to the person being paid, Bitcoin Cash payments are sent directly from one
person to another.

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 USD Coin
USD Coin (known by its ticker USDC) is a stable coin that is pegged to the U.S.
dollar on a 1:1 basis. Every unit of this cryptocurrency in circulation is backed up by
$1 that is held in reserve, in a mix of cash and shortterm U.S. Treasury bonds

6 Conclusion and Suggestion

Crypto currency is an impressive technique of achievement, but it remains a monetary

experiment. Even if crypto currencies survive, they may not fully displace fiat currencies.
As we have tried to show in this report, they provide an interesting new perspective from

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which to view economic questions surrounding currency governance, characteristics of
money, the political economic of financial intermediaries, and the nature of currency
competition.

The price of crypto currency is found to be volatile and the buying and selling price may
differ at any time. Although, it is found to be in increasing curve but such points occurs in
large interval of time and between such intervals there lies many sub points which are
highly volatile. Since, crypto currencies are not asset-backed, its value as a currency can
only lie in its usefulness as a medium of exchange.

Citation and Reference

E-commerce, (2077 BS)Kriti Publication pvt.ltd.

VSK Kaumudi, IPS (2021). Methodologies of Cryptocurrency

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Bryman, A. and Bell, E. (2012). Business Research Methods, New Delhi: Oxford
University Press.

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