How Cryptocurrency works in the economy.

1. CRYPTOCURRENCY
Group # 06
ANURUPA BANERJEE (PGP03014)
ARJUN DIXIT (PGP03015)
KAUSHIK BAGCHI (PGP03029)
MOHIT YADAV (PGP03033)
NIVEDITA DAS (PGP03039)
PRINCE SHARMA (PGP03045)
SANAT KUMAR GABEL (PGP03052)
YASH SHAH (PGP03063)

2. CONTENTS
• Introduction to cryptocurrency
• Its advantages, risk involved and failures
• Conventional currency v Cryptocurrency
• Reaction of governments
• Buying of cryptocurrency- who? why? and how?
• Relation with the monetary policies
• Our inferences and conclusion

3. INTRODUCTION AND ADVANTAGES
• Virtual
• Alternative
• Decentralized
• Anonymous
• International
A digital asset designed to work as a medium of exchange that uses
cryptography to secure its transactions, to control the creation of
additional units, and to verify the transfer of assets

4. TOP TEN CRYPTOCURRENCY IN 2016
• Bitcoin
• BlackCoin
• Dash
• Dogecoin
• Litecoin
• Namecoin
• Nxt
• Peercoin
• Primecoin
• Ripple

5. HOW TO BUY CRYPTOCURRENCY?
• Cryptocurrency
exchanges (online)
• Bitcoin ATMs (put
money inside and
load your bitcoin
wallet)
• Bitcoin Voucher Cards
(i.e. Austrian Post
office, House of
Nakamoto, Azteco
London)
• Buy it personally from
other people
Where to buy
cryptocurrency ?
Online Exchange
Person-to-person
Bitcoin ATM
Paypal Credit Card Cash
Payment methods
Bank
transfer

6. • Purchase custom mining hardware
Popular Bitcoin-mining hardware brands include Butterfly Labs,
Bitcoin Ultra, CoinTerra, and more

7. WHO BUYS CRYPTOCURRENCY
• Any individual can buy cryptocurrency.
• Payment service provider.
• Financial institutes.
• Investors.
• Venture capitalist.

8. WHY CRYPTOCURRENCY
• Transactions are irreversible, fast and have low fees.
• Universal (within the internet).
• Decentralised, no trust necessary.
• The supply of coins is regulated by software and the arrangements of the
users of the system and cannot be manipulated by any government,
bank, organization or individual.

9. RISK AND FAILURES
• Supporting Criminal Activity
• Cryptocurrencies can be used to anonymously purchase illegal goods,
launder money from illegal activities and purchase illegal services.
• Lack of Transparency
• The anonymous nature of cryptocurrencies make transparency and
accountability difficult for consumers seeking to ensure safety of their
investments.
• Hackers
• Cryptocurrencies are target for highly sophisticated hackers who have
been able to breach the advanced security system.

10. RISK AND FAILURES (Contd.)
• Cost
• Cryptocurrencies can cost consumers much more to use than credit cards
or even regular cash, often due to price volatility.
• Scams
• Fraudsters are taking advantage of the hype surrounding virtual
currencies to cheat people with fake opportunities.
• Fewer Protections
• If you trust someone else to hold your cryptocurrencies and something
goes wrong, that company might not offer you the assistance you expect
from bank or debit/credit card provider.

11. CRYPTOCURRENCY AND ITS MONETARY POLICIES
• All cryptocurrencies have inflexible monetary policies implemented through their coding and DNA
• Types of Cryptocurrencies base on their monetary policies:
• Deflationary Coins
• Total number of coins is fixed. e.g. Bitcoin 21m
• Growth Coins
• No limit on number of coins. No. of coins grow steadily with a fixed coin supply rate. e.g. Dogecoin and
Reddcoin.

12. WHY CONVENTIONAL POLICIES WONT WORK?
• Not regulated by any government or central body
• No central control over economic behaviors like inflation, unemployment etc. as the conventional methods
of expansionary and contractionary policies won’t work
• Can be traded, mined and sold directly without the role of a regulating body
• Therefore, no control of any central body

13. Similarity:
• similar to traditional currencies. It is recognised and has a value
• can be used to buy things
• its value can change according to market variables
Difference:
• Unlike any traditional currency, bitcoin is not bound to an institution
• or country
• International and not subject to authorities like bank or governments
• that are typically associated with other currencies
COMPARISON WITH CONVENTIONAL CURRENCY

14. • It needs to be reasonably difficult to produce
• it needs to have a limited supply .
• it needs to be recognised
BITCOIN: PARALLEL WITH GOLD
Defining Characteristics:
• Like gold, bitcoin supply is limited.
• Bitcoin technology can only ever produce a certain amount of
bitcoins. The more bitcoins that are produced, the harder it is to
create new ones. In this way, the value of bitcoins is regulated.
• Because of its parallels with gold, the production of bitcoins is
known as mining.

15. ACCEPTANCE OF BITCOIN ACROSS THE WORLD

16. ACCEPTANCE OF BITCOIN IN INDIA
Bitcoin is not legally accepted in India as of now due to the
following reasons:
• Governments are unable to track payments in bitcoins.
• It is a decentralized mode of exchange.
• Lack of underlying legal framework.
• Vulnerability to loss
• It is highly volatile.

17. THANK YOU