“Running Business in Crypto exchange area. Positive and negative sides”.

Background and rationale.

According to historical sources, money as a payment instrument has appeared in 7 th
century B.C. That means it was before such skills as writing, reading and even before state as
an organization. In this case, it can be assumed that key factor of early appearance of money
was the necessity of equivalent in exchanging goods and services. For millennia, trade
caravans roamed the expanses from Arabia, through the Middle East to Asia and Europe. And
as a rule, most of these transactions were fair and concluded directly between the buyer and
the seller, without intermediaries. With the advent of forms of statehood, two players were
added to these transactions: taxes and commercial banks and organizations. Nowadays, money
transactions between persons or companies are centralized and all data are controlled by a
third organization, rather than the two principal entities involved in the transaction (Yli-Huumo J.
Houbing Song, West Virginia University, October 3, 2016).

Attempts to solve the problem to avoiding fees for payments and transfers, as well as
total control over the online cash flow, have led to the creation of a new technology called
blockchain. Blockchain is a decentralized transaction and data operating technology, which is
broken down into several independent sources (Yli-Huumo J. Houbing Song, West Virginia
University, October 3, 2016).
Sarmah S.S. said in her research that “It is a database of record of transactions which is
distributed, and which is validated and maintained by a network of computers around the world”
(Understanding Blockchain Technology, 2018).
However, this research is not about blockchain technology, its history, architecture and how it
works. The main point is the existence of alternative to bank system, which is based on
decentralized database system and cannot be manipulated by regulators as in ancient times
during caravan’s trading. As this system already exists, it needs to figure out how to be efficient
in it and try to benefit from it. As a subject of research in this sector, it was chosen the
cryptocurrency exchange business. By analyzing facts and dynamic changes, it is going to
show advantages and disadvantages from the position of owner of an exchange company.
Research aim.
To make detailed analysis in Crypto currency business, which would serve as a basis for the
decision whether to open commercial company on this direction or not.

Research questions.
 - How big is the scope of market of Crypto currency exchange?
- What is the business model of this activity?
- How much investment is needed and what is the ROI period?
- Important features of management and customer behavior
- Risks, pitfalls and future perspectives.

Research approach.
There would be mixed primary (analyzing my own company) and secondary research (collecting
data form other sources).

Annotated bibliography.

 Jesse Yli-Huumo, Deokyoon Ko, Sujin Choi ,Sooyong Park, Kari Smolander “Where Is
Current Research on Blockchain Technology? A Systematic Review”. Research article,
Houbing Song, West Virginia University, UNITED STATES October 3, 2016
https://doi.org/10.1371/journal.pone.0163477

Authors use systematic mapping process as a mythology of research which could help
to find gaps in investigations of blockchain technology. It can be useful to look to this
platform from different views.

 Simanta Shekhar Sarmah, “Understanding Blockchain Technology” Computer Science

and Engineering 2018, 8(2): 23-29 DOI: 10.5923/j.computer.20180802.02

Simanta showed open and understandable information of blockchain system. Before

diving into exact theme of research project it is necessary to cover common idea of the
instrument, its nature.