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Suhan 12th Com Eco Project

The document is a report by Suhan Ashwinbhai Macwan, a class 12 student, on the topic of whether cryptocurrency is a boon or bane. It begins with an introduction defining cryptocurrency and crypto. It then discusses how cryptocurrency works and how to buy it. Next, it outlines reasons for cryptocurrency's popularity, concerns about its safety, and how businesses can use it. The report also examines cryptocurrency as both a boon due to benefits like financial inclusion and innovation, and a bane due to risks such as volatility, lack of regulations, and environmental impact.

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0% found this document useful (0 votes)
1K views

Suhan 12th Com Eco Project

The document is a report by Suhan Ashwinbhai Macwan, a class 12 student, on the topic of whether cryptocurrency is a boon or bane. It begins with an introduction defining cryptocurrency and crypto. It then discusses how cryptocurrency works and how to buy it. Next, it outlines reasons for cryptocurrency's popularity, concerns about its safety, and how businesses can use it. The report also examines cryptocurrency as both a boon due to benefits like financial inclusion and innovation, and a bane due to risks such as volatility, lack of regulations, and environmental impact.

Uploaded by

charmi3964
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 31

Name:- Suhan Ashwinbhai Macwan

Class:- 12 COM

YEAR:-2023-2024

Topic:- Crypto A Boon Or Bane


INDEX
1) Introduction of crypto
2) Defination of crypto
3) Crypto As Boon
4) Crypto As Bane
5) How does cryptocurrency work?
6) How to buy cryptocurrency?
7) Why are cryptocurrency popular?
8) Is cryptocurrency safe?
9) The use of cryptocurrency in business
10) How do you get cryptocurrency?
11) How is cryptocurrency different from U.S. Dollars?
12) How To Avoid Cryptocurrency Scams?
13) How To Report Cryptocurrency Scams?
14) What can crypto do for your company?
15) Types of cryptocurrencies
16) Cryptocurrencies to explode in 2023
17) Crypto tax rates
18) Cryptocurrency fraud and cryptocurrency scams
19) How to store cryptocurrency?
20) How to protect bitcoin and cryptocurrency?
21) Advantages Of Investing In Cryptocurrency
22) Disadvantages Of Investing In Cryptocurrency
23)
INTRODUCTION

The term "crypto" is an abbreviation for "cryptocurrency," which is a


digital or virtual currency that employs cryptography for security.
Cryptocurrencies are decentralised and usually rely on blockchain
technology to record and verify transactions. They are distinct from
typical fiat currencies such as the US dollar or the euro since they are
not regulated by any central authority, such as a government or a

central bank.

The term "crypto" can also apply to anything linked to cryptography or


cryptographic processes, and is not restricted to cryptocurrencies.
Cryptography is the study of safe communication that is utilised in a
variety of domains such as information security, data protection, and
secure communication protocols.
CRYPTO A BOON
1. Financial Inclusion: Cryptocurrencies have the potential to
provide financial services to those who are underserved or
excluded from the traditional banking system, particularly in
developing nations.
2. Decentralisation: The underlying technology of
cryptocurrencies, blockchain, promotes decentralisation and
transparency, minimising the need for middlemen such as
banks and financial institutions.
3. Security: Cryptocurrencies employ powerful cryptographic
algorithms that make it impossible to forge or hack
transactions, hence improving security and minimising
fraud.
4. Innovation:- Financial technologies, blockchain
applications, and even non-financial businesses have seen
substantial innovation as a result of the bitcoin industry.
5. Investment Opportunities: Many people have gained from
investing in cryptocurrencies, and it has opened up new
investment opportunities, but it also carries a high level of
risk.
CRYPTO A BANE
1. Volatility: The price volatility of cryptocurrencies is well
known. As a result, they might be hazardous to invest in and
less ideal as a reliable store of value.
2. Regulatory Concerns: Governments and financial
organisations are concerned that cryptocurrencies might be
used to aid criminal activities such as money laundering and
tax evasion.
3. Lack of Consumer Protections: Due to the decentralised
nature of cryptocurrencies, people who lose their funds due
to fraud or technical faults sometimes have limited recourse.
4. Impact on the Environment: Some cryptocurrencies, like
as Bitcoin, have been chastised for their high energy use and
contribution to carbon emissions.
5. Speculation: Cryptocurrencies are frequently driven by
speculation, which can result in bubbles and collapses,
bringing financial loss to investors.
6. Complexity: For the normal person, understanding and
utilising cryptocurrencies may be difficult, and errors in
managing private keys or transactions can result in financial
loss.
HOW DOES CRYPTOCURRENCY WORK?
Cryptocurrencies are based on blockchain, a distributed public
ledger that keeps track of all transactions that are updated and
maintained by currency holders.
Mining is a technique that uses computer power to solve
complex mathematical problems that earn coins to construct
cryptocurrency units. Users may also purchase the currencies
from brokers and use encrypted wallets to store and spend
them.
You don't possess anything concrete if you hold bitcoin. What
you have is a key that allows you to transfer a record or a unit
of measurement from one person to another without the
assistance of a trusted third party.
How to buy cryptocurrency?

Step 1: Choosing a platform


The first step is deciding which platform to use. Generally, you
can choose between a traditional broker or dedicated
cryptocurrency exchange:
➢Brokers who are traditional. These are online brokers
who provide services for purchasing and selling
cryptocurrencies as well as other financial assets such as
stocks, bonds, and ETFs. These platforms often have
cheaper trading fees but fewer crypto features.
➢Exchanges of cryptocurrencies. There are several
cryptocurrency exchanges to select from, each with its
own set of cryptocurrencies, wallet storage, interest-
bearing account choices, and other features. Asset-based
fees are charged by several exchanges.

Consider which cryptocurrencies are available, the fees they


charge, the security features, storage and withdrawal
choices, and any instructional materials when comparing
different platforms.

Step 2: Funding your account

After you've decided on a platform, the following step is to


fund your account so you can start trading. Most crypto
exchanges enable users to buy crypto with fiat (government-
issued) currencies like the US dollar, British pound, or Euro
using their debit or credit cards, however this varies by
platform.

Credit card purchases of cryptocurrency are deemed


dangerous, and some exchanges do not accept them. Crypto
transactions are also not permitted by some credit card
companies. This is due to the extreme volatility of
cryptocurrencies, and it is not prudent to risk getting into
debt – or perhaps paying hefty credit card transaction fees –
for some assets.

An important factor to consider is fees. These include


potential deposit and withdrawal transaction fees plus
trading fees. Fees will vary by payment method and
platform, which is something to research at the outset.

Step 3: Placing an order


You can place an order using your broker's or exchange's
web or mobile interface. If you wish to acquire
cryptocurrencies, click "buy," then pick the order type, enter
the number of coins you want to buy, and complete the
order. The same procedure applies to "sell" orders.

There are many alternative methods to invest in


cryptocurrency. These include payment platforms such as
PayPal, Cash App, and Venmo, which allow users to
purchase, sell, or store cryptocurrencies.
Why are cryptocurrencies popular?
Cryptocurrencies, notably Bitcoin, have risen to mainstream
appeal and trillion dollar values after being regarded as a
niche passion of tech fanatics. For the first time in
November 2021, the price of Bitcoin surpassed $60,000 for
the first time. (It had dropped to $23,000 by February 2023.)
By mid-2022, an estimated 20% of individuals in the United
States interviewed by NBC News had invested in, traded, or
utilised cryptocurrencies.
The value of Bitcoin and other cryptocurrencies fluctuates
drastically, according to some experts, limiting their utility
as a method of trade. Nevertheless, some businesses accept
Bitcoin. Some regard Bitcoin as a hedge against inflation
since its supply is set in perpetuity, unlike fiat currencies,
which central banks may print endlessly. However, as
Bitcoin dropped due to stock market volatility in 2022,
several analysts called this theory into question.
Is cryptocurrency safe?
Blockchain technology is commonly used to create
cryptocurrencies. Blockchain refers to the method by which
transactions are recorded in "blocks" and time stamped. It's a
rather intricate, technical procedure, but the end result is a digital
ledger of bitcoin transactions that hackers find difficult to
manipulate.

In addition, transactions require a two-factor authentication


process. For instance, you might be asked to enter a username and
password to start a transaction. Then, you might have to enter an
authentication code sent via text to your personal cell phone.

While security measures are in place, this does not mean that
cryptocurrencies are impenetrable. Several high-value hacks have
cost bitcoin startups a lot of money. Hackers stole $534 million
from Coincheck and $195 million from BitGrail, making them two
of the largest cryptocurrency attacks of 2018.

In contrast to government-backed money, the value of virtual


currencies is totally determined by supply and demand. This can
result in huge fluctuations that result in large gains or losses for
investors. Furthermore, bitcoin investments have significantly less
regulatory protection than traditional financial assets such as
equities, bonds, and mutual funds.
The use of cryptocurrency in business
Why companies should consider using
cryptocurrency?

A growing number of businesses throughout the world are utilising bitcoin


and other digital assets for a variety of investing, operational, and
transactional objectives. As with every frontier, there are unknown
hazards as well as powerful incentives. Investigate the kind of questions
and insights that businesses should examine when deciding whether and
how to employ digital assets.

The use of cryptocurrency in business


People utilise cryptocurrencies for a variety of reasons, including rapid
payments, avoiding transaction costs charged by traditional banks, and
providing some privacy. Others hold cryptocurrencies as an investment,
hoping for a rise in value.

How do you get cryptocurrency?

You may purchase cryptocurrencies from a cryptocurrency exchange, an


app, a website, or a cryptocurrency ATM. Some people earn bitcoin by
"mining," a sophisticated process that involves expensive computer
equipment to solve exceedingly complex arithmetic challenges.
How is cryptocurrency different from U.S. Dollars?

Because cryptocurrency exists only online, there are important differences


between cryptocurrency and traditional currency, like U.S. dollars.

A government does not back cryptocurrency accounts. Cryptocurrency


housed in accounts is not covered by the government in the same way that
US dollars are insured in an FDIC-insured bank account. If something
happens to your account or your assets, such as the firm that stores your
wallet going out of business or being hacked, the government is under no
duty to step in and assist you get your money back.

The value of cryptocurrencies fluctuates all the time. The value of a


cryptocurrency can fluctuate swiftly, perhaps hourly. And the amount of
change might be substantial. It is determined by a variety of factors,
including supply and demand. Cryptocurrencies are more volatile than
traditional assets like equities and bonds. An investment worth thousands
of dollars now may be worth only a few hundred dollars tomorrow. And,
if the value falls, there is no assurance that it will rise again.
How To Avoid Cryptocurrency Scams?
• Only crooks want cryptocurrency payment. No respectable business
will need you to send bitcoin in advance - not to buy anything nor to
secure your money. That is always a con.
• Profits or large returns are only guaranteed by crooks. Don't believe
anyone who claims you can earn money quickly and easily in the
cryptocurrency markets.
• Never combine online dating with financial advice. It's a fraud if
you meet someone on a dating site or app who wants to show you
how to invest in cryptocurrency or asks you to transfer them
cryptocurrency.
How To Report Cryptocurrency Scams
Report fraud and other suspicious activity involving cryptocurrency
to
• the FTC at ReportFraud.ftc.gov
• the Commodity Futures Trading Commission (CFTC) at
CFTC.gov/complaint
• the U.S. Securities and Exchange Commission (SEC) at sec.gov/tcr
• the Internet Crime Complaint Center (IC3) at
ic3.gov/Home/FileComplaint
• the cryptocurrency exchange company you used to send the money
What can crypto do for your company?
A improved understanding of the crypto business and
blockchain technology can bring new investment and liquidity
possibilities through tokenized traditional assets.
Introducing cryptocurrency today may assist raise internal
knowledge of this technology in your organisation. It may also
help the corporation position itself in this new market for a
future that may include central bank digital currency (CBDCs).
More businesses are discovering that critical clients and vendors
want to engage via cryptocurrency. As a result, your company
may need to be prepared to collect and distribute cryptocurrency
in order to ensure smooth transactions with important
stakeholders.
TYPES OF CRYPTOCURRENCIES
1. Bitcoin
Bitcoin is widely considered as the first decentralised cryptocurrency that
makes use of blockchain technology to conduct payments and digital
transactions. Instead of relying on a central bank to control an economy's
money supply (such as the Federal Reserve in collaboration with the
United States Department of Treasury) or third parties to verify
transactions (such as your local bank, credit card issuer, and merchant's
bank), Bitcoin's blockchain serves as a public ledger of all transactions in
Bitcoin's history.
2. Ether (Ethereum)
Ether is a cryptocurrency that is used to conduct transactions on the
Ethereum network. Ethereum is a platform that uses blockchain
technology to enable the creation of smart contracts and other
decentralised applications (meaning the software does not have to be
distributed on app exchanges such as Apple's (AAPL -0.47%) App
Store or Alphabet's (GOOGL -0.96%) Google Play Store, where they
may have to give the tech giants a 30% cut of any revenue). Ethereum
is both a cryptocurrency (the coins themselves are measured in Ether
units) and a software development sandbox.
3. Tether
Tether is a stablecoin, or cryptocurrency that is linked to a fiat
currency, in this instance the US dollar. Tether's concept is to combine
the advantages of a cryptocurrency (such as eliminating the need for
financial intermediaries) with the stability of a currency issued by a
sovereign government (as opposed to the wild price volatility inherent
in many cryptos).

4. Binance Coin
Binance Coin is accessible for trade on the Binance cryptocurrency
exchange platform, among other digital currencies. Binance Coin may
be used as a sort of money, but it also allows tokens to be created that
can be used to pay fees on the Binance exchange and to fuel Binance's
DEX (decentralised exchange) for app development.
5. USD Coin
USD Coin is a stablecoin that, like Tether, is linked to the US dollar.
USD Coin, like Tether, is housed on the Ethereum blockchain. The
goal of USD Coin was to create a "fully digital" dollar that had the
stability of US fiat currency but does not require a bank account or the
bearer to live in a certain nation. Rather than being an investment,
USD Coin is envisioned as daily money that may be used with online
retailers.
Cryptocurrencies To Explode In 2023

1. SingularityNET
SingularityNET (CRYPTO:AGIX) is a blockchain platform that
allows anybody to build, distribute, and sell artificial intelligence
services. It offers a worldwide AI marketplace where users may use
the AGIX utility token to acquire a variety of AI services.

SingularityNET was already a big success in 2023, with its price


soaring by more than 1,300%. It then fell, most likely because
some investors cashed out. However, as AI and the number of
organisations adopting AI rise, it may experience more success.

2. Fetch.ai
The most exciting aspect about bitcoin investments is that when
they boom, their value skyrockets. Solana (SOL 3.72%) increased
by more than 10,000% in 2021. Shiba Inu meme token (SHIB -
3.39%) increased by more than 40,000,000%.

It is plainly hard to predict which cryptocurrency will explode next.


However, we can identify some potential candidates who are
capitalising on current developments such as artificial intelligence
(AI), decentralised applications (dApps), and blockchain.

The most thrilling aspect about bitcoin investments is that when


they erupt, their value skyrockets. In 2021, Solana (SOL 3.72%)
increased by more than 10,000%. Shiba Inu meme token (SHIB -
3.39%) increased by more than 40,000,000%.

3. Polygon
Polygon (MATIC -2.25%) is a blockchain platform that is meant to
interact with another blockchain platform. It increases the scalability of
Ethereum by allowing its dApps to leverage Polygon's sidechains.
One of the most fascinating aspects about Polygon is the collaborations
it has formed. Many major brands are collaborating with Polygon to
establish NFT projects. Current partners include:
Walt Disney (DIS 0.77%)
Starbucks (SBUX -0.45%)
Meta Platforms (META -0.48%)
Nike (NKE 0.24%)

5. Monero

Monero (XMR -0.52%) is the most well-known privacy coin,


which is a cryptocurrency that allows for anonymous, untraceable
transactions. It employs privacy-enhancing technologies to conceal
the sender, receiver, and amount of each transaction.

This coin has been in circulation since 2014, which is a long period
in a market as volatile as bitcoin. The increased crypto legislation
in several nations, including the United States, makes it an
appealing investment right now.
Advantages Of Investing In Cryptocurrency:
High Returns: Cryptocurrency investments have gotten a lot of
interest because of their high return potential. Many early investors
in cryptocurrencies such as Bitcoin and Ethereum have made huge
gains. However, it is vital to emphasise that cryptocurrency
investments are fraught with danger and should be treated with
caution.

Decentralisation and security: The decentralised nature


of bitcoin is one of its key features. Transactions are carried out
directly between individuals, with no need for intermediaries like
as banks. Furthermore, blockchain technology provides openness
and security, making tampering with transaction records extremely
difficult.
Disadvantages Of Investing In Cryptocurrency:
Uncertainty in the Regulatory environment: The regulatory
environment surrounding cryptocurrencies is still changing in many
places. Uncertainty over laws can have an influence on the value
and acceptance of cryptocurrencies, posing a risk to investors.

Cybersecurity Risks: Because cryptocurrency operates in a digital


environment, it is vulnerable to cybersecurity risks. Funds can be
lost as a result of hacking efforts, frauds, and phishing assaults. To
secure their bitcoin assets, investors must take prudence and
implement stringent security procedures.
Crypto tax rates for 2022

The tax rate on cryptocurrency is determined on your income, tax


filing status, and the length of time you possessed it before selling
it. If you possessed it for fewer than 365 days, you must pay short-
term gains taxes, which are equal to income taxes. If you owned it
for a longer period of time, you must pay long-term capital gains
taxes.
Crypto tax rates for 2023

Cryptocurrency fraud and cryptocurrency


scams
Unfortunately, cryptocurrency crime is on the rise. Cryptocurrency
scams include:
Fake websites: Fraudulent websites with phoney testimonials and
crypto jargon that promise large, guaranteed profits if you keep
investing.
Virtual Ponzi schemes: Cryptocurrency thieves offer non-existent
chances to invest in digital currencies while creating the illusion of
enormous profits by repaying previous investors with the money of
new investors. Before its offenders were arrested in December
2019, BitClub Network generated more than $700 million.

"Celebrity" endorsements: Scammers act as millionaires or well-


known personalities on the internet, promising to quadruple your
investment in a virtual currency but instead stealing what you
contribute. They may even utilise messaging applications or chat
forums to spread claims that a well-known businessperson is
supporting a particular cryptocurrency. After encouraging investors
to purchase and driving up the price, the fraudsters sell their
investment, and the currency's value falls.
Romance scams: Dating apps are no stranger to crypto
scams. These scams involve relationships -- typically long-distance
and strictly online -- where one party takes time to gain the other
party's trust. Over time, one party starts to convince the other to
buy or give money in some form of cryptocurrency.
After getting the money, the dating scammer disappears. These
scams are also referred to as "pig butchering scams."
Fake cryptocurrency exchanges: Scammers may lure
investors in with promises of a great cryptocurrency exchange --
maybe even some additional bitcoin. But in reality, there is no
exchange and the investor does not know it's fake until after they
lose their deposit.
To avoid an unknown exchange, stick to well-known crypto
exchange marketplaces like as Coinbase, Cryptocurrency, and Cash
App. Before submitting any personal information, conduct some
research and visit industry websites to learn more about the
exchange's reputation and authenticity.
Rug pull scams: Rug pull scams include investing con artists
"pumping up" a new project, nonfungible token (NFT), or currency
in order to obtain money. Scammers take the money and then
disappear with it. The code for these investments stops consumers
from selling bitcoin after they acquire it, leaving them with a
worthless investment.
A popular version of this scam was the Squid coin scam, named
after the popular Netflix series Squid Game. Investors had to play to earn
cryptocurrency: People would buy tokens for online games and earn more
later to exchange for other cryptocurrencies. The price of the Squid token
went from being worth 1 cent to about $90 per token.
Eventually, trading stopped and the money disappeared. The token value
then reached zero as people attempted but failed to sell their tokens. The
scammers made about $3 million from these investors.
How to protect bitcoin and cryptocurrency
To protect against cryptocurrency scams, here are some of the common red
flags:
• promises for large gains or double the investment;
• only accepting cryptocurrency as payment;
• contractual obligations;
• misspellings and grammatical errors in emails, social media posts or
any other communication;
• manipulation tactics, such as extortion or blackmail;
• promises of free money;
• fake influencers or celebrity endorsements that seem out of place;
• minimal details about money movement and the investment; and
several transactions in one day
.

How to store cryptocurrency?

Once you have obtained bitcoin, you must keep it safe to avoid
hacking or theft. Typically, cryptocurrency is housed in crypto
wallets, which are physical hardware or online software that
safeguard the private keys to your coins. Some exchanges provide
wallet services, allowing you to store funds directly through the
site. However, not all exchanges or brokers immediately provide
wallet services for you.
There are different wallet providers to choose from. The terms “hot
wallet” and “cold wallet” are used:
Hot wallet storage: "hot wallets" refer to crypto storage that uses
online software to protect the private keys to your assets.
Cold wallet storage: Unlike hot wallets, cold wallets (also known
as hardware wallets) rely on offline electronic devices to securely
store your private keys.
Typically, cold wallets tend to charge fees, while hot wallets don't.

Conclusion
The future of cryptocurrency holds vast potential for disruption and
innovation in the financial sector. While cryptocurrencies offer
advantages such as decentralization, security, and accessibility,
investors must know the market’s volatility and associated risks.
BIBLIOGRAPHY
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2. https://consumer.ftc.gov/

3. https://www2.deloitte.com/

4. https://www.fool.com/

5. https://www.kaspersky.com/
6. https://www.public.asu.edu/

7. https://www.wikipedia.org/

8. https://www.techtarget.com/

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