Cryptocurrency & Blockchain: Technology, Applications, and Analysis

This report provides a comprehensive overview of cryptocurrency and blockchain technology, examining their fundamental concepts, applications, and implications. It begins by discussing the emergence of Bitcoin and its characteristics, including its open-source nature, market speculation, and the risks associated with its volatility and security. The report then delves into blockchain technology, highlighting its role in providing security and privacy through public and private blockchain models. It explores blockchain's applications in various fields, including the Internet of Things, finance, and the energy market. The report also examines the limitations of Bitcoin and the introduction of Ethereum, which addresses some of these limitations. Furthermore, it discusses the features of blockchain such as transparency, security, and the ability to store data securely. The report concludes by analyzing the impact of cryptocurrency and blockchain on various industries, including finance and construction, and the potential benefits of smart contracts and decentralized systems. The report also touches upon the use of blockchain in energy token markets and its role in crypto-trading projects.

Running Head: CRYPTOCURRENCY & BLOCKCHAIN
Cryptocurrency and Blockchain
Name of the Student
Name of the University
Author Note

1CRYPTOCURRENCY & BLOCKCHAIN
Cryptocurrency and blockchain
According to Scott, 2016, the
international platform has acknowledged the rise
of Bitcoin ambivalently. Crypto-currency has
been an open-source to be connected in a single
network. This technology has brought
speculation in the market, it has been a
fundamental usage by the professionals in
today’s market. This is expected to drive a huge
amount of profit for the entrepreneurs. The
community that deals with the exchange of
bitcoin are preferably from developed countries.
The bitcoin is the electronic form of normal
money. The risks that the authors have discussed
is of safety and volatility. At the beginning of
the emergence of Bitcoin, it was subversive,
mysterious, mischievous and not directly a
system for commercial use in the normal market.
It has a locked-in currency and it fluctuates
greatly (Scott 2016). The volatility of the bitcoin
is risky because if a large audience gets engaged
then the prices get decreased. The possibility of
risks that prevails with the use of bitcoin is the
data breaches, the involvement of third-party,
chances of hacks in the computers, etc. Another
aspect of the crypto-currency is that the code for
creating the currency can be cloned to make
other currency of similar type but with different
characteristics.
The emergent technology like block-
chain has been flourishing in the field of
Information of technology for providing security
and privacy to several devices and applications.
The technology is secured with an extra layer by
changing its Public Key; this characteristic helps
in several applications to include this
technology. The two types of blockchain that the
author has discussed are the public and the
private. In private blockchain, it allows access to
the authorized parties only and keeps the
identification of user privacy. Whereas, the
public block-chain enables permission to the
users to write and read like in Bitcoin (Miraz
and Ali 2018). The technology of Block-chain
allows interacting peer- to- peer. One effective
feature of this technology is to provide a secure
transaction and keeps all the records intact. In
the environment of the Internet of Things, the
block-chain connects all the devices together to
track the operation throughout. The properties
that the block-chain is observed beyond the
facilities that Bitcoin receives by the virtue of
traceability, security, provenance, privacy, etc. It
also ensures the data to be redundant and survive
all the adverse conditions. An aspect of the
Internet of things the main catalyst to increase
the functionality of the devices in the
environment are through blockchain and its
properties of reliability, scalability, privacy and
security.
The author has defines the blockchain as
the management of data and transactions for
taking the technology ahead of cryptocurrency
and bitcoin’s success. The single block of a
blockchain consists of a binary hash tree, and it
is designed as the linked list such that the
address of the previous block is present in the
next block. All the block are connected in the
same manner (Tasatanattakool and
Techapanupreeda 2018). It is observed from the
paper that cryptocurrency is the first-ever
application that has the basis of blockchain,
followed by peer- to- peer network and
techniques of cryptography. The transaction in
the blockchain technology is about the
information stored in each block. Bitcoin is the
first-ever application of blockchain and the
second one is the ethereum. The second one
aims to have programs that does the smart
contracts on the online platform similar to the
paper contract (Garriga, Arias and De Renzis
2018). The various purposes of the blockchain
that have been discussed in this paper are service
of cloud for managing the services on the
platform, for privacy as it has the feature of
representing itself anonymously, help the e-
commerce with transparency, efficiency and
security, it enables the effective communication
and interaction between the other available
blockchains around it.
According to Vujičić, Jagodić and
Ranđić 2018, the field of information
technology is shaped by the introduction of
blockchain and bitcoin. The decentralization of
the currency is beneficial for several factors in
this emerging technological world. The

2CRYPTOCURRENCY & BLOCKCHAIN
implementation of the digital currency has faced
some problems in the past and while the
transaction of the bitcoin is taking place the
details of the transaction were received
chronologically. The secure transaction was
taken place by the use of the private key for
transaction signing and the verification of the
transaction was carried out by the public key
(Vujičić, Jagodić and Ranđić 2018). There was
some limitation observed with bitcoin such as
the loss of the bitcoin can never be recovered,
the volatility of bitcoin is uncontrollable. Hence
the introduction of Ethereum has abolished some
of the limitations of the bitcoin and it provides
and an extra layer of protection with the aids of
cryptographic rules, smart contracts and the
accountability of Ethereum is possible.
The simple definition of the blockchain
is present in the paper that is it a form of the data
structure for information storage in a peer- to-
peer network. The usage of blockchain enables
all the participants to have a copy of the
information at every node that is connected
together. The feature of blockchain enables the
user to see the network that the devices are4
connected and the data that are accessed in the
course of time. In order to st6otre the data, the
validity of the data present inside is necessary
(Castellanos, Coll-Mayor and Notholt 2017).
The characteristics that have been observed are
the information and data inside the block of the
blockchain are secure as the protocols have to be
followed for the use of the blockchain
technology, the availability of transparency
within the nodes are highly usable for
incorporating this technology in any modern
work as the nodes connected together can see
the contents of the other one, the information of
the blocks are distributed with the feature of
each node to write and read the information of
other nodes. The author discusses an
environment in which the energy token market
was developed by the virtue of smart contracts
and Ethereum. The various functionality that
occurs in this market is mostly facilitated by the
smart contract and it acts as both the place of the
market and the operator of the market
(Watanabe et al. 2015). The operation that is
done by the smart contract is allowing the token
of transactions within the consumers and the
prosumers, allowing of cashing out, enables the
consumer’s registration and tracks an record all
the details of the consumers and their respective
tokens.
The industries are getting equipped with
all the evolving technologies. Hence the
utilization of blockchain by the electricity
market is accepted widely. The network of
intelligent energy by the utilization of
blockchain and the system that uses for the
control and the measurement of the operation in
the same industry (Guegan 2017). The ability of
blockchain technology to have a distributed
system enables the growth of this market. The
sustainability in the market of energy is also
necessary to obtain the benefits of blockchain.
The project that has been taken into
consideration in this paper is of Crypto-trading,
and the aim of this project is to have a clear
solution using the blockchain in the Energy
Market (Mannaro, Pinna and Marchesi 2017).
The issues that are expected to present alongside
the project are sustainability, energy issues due
to the use of blockchain in place of the
centralized system of ICT. The limitation of the
project is expected to be overcome by the
implementation of the protocols of blockchain.
The main befits that are observed in the market
are from smart contracts and blockchain
technology.
The market for cryptocurrency has
emerged drastically with the support of
blockchain technology. The potential and
application of this technology is vast as the
features of the technology allows to operate in a
closed network along with that keeps all the
record of the transactions and operation taking
place by the utilization of the technology (Yaga
et al. 2019). The value of the blockchain has
increased in recent years drastically. Blockchain
has all the security benefits that are essential for
any industry and one of the section of the
finance industry is banking, this sector will have
to most benefits as hackers will not be able to
make unauthorized transaction due to the
presence of the record-keeping capability of the
blockchain (Min 2019). The network of
blockchain can be privatized and only selected
members will be allowed to access the network
with due permission. The most usefulness of
blockchain is that the users can only block in the
existing blockchain and can never delete any

3CRYPTOCURRENCY & BLOCKCHAIN
block. The other benefits of the technology are
transparency in the supply chain by open ledger,
the involvement of third-party is not required for
carryout transaction thus saving the cost of the
business and it provides high connectivity
between the virtual and the physical world and
allows the involving people to track supply
chain and information flow.
The article discusses the contrasting
nature of blockchain that is the disruptive nature
of the technology. The technology of blockchain
is described as the system that is distributed in
nature, that is the detail of the transactions are
present to both the participating parties. The
difference from the traditional ways of a
transaction is that it keeps the record of the
transaction in a separate ledger. The storage
takes place after the verification and after that,
no modification is allowed on the stored
information. Every block of the blockchain has
the hash of the previous block and its own root.
By this, all the blocks are connected to each
other (de Kruijff and Weigand 2017). The three
forms of the blockchain that are discussed in the
paper are the private, public and hybrid. The
finance industry prefers the private blockchain
that has a closed environment and operations are
carried out with the designated and trusted peers.
It avoids all the anonymous nodes that try to
connect within the closed environment. The
example of a public blockchain is bitcoin, it has
the anonymous nodes preventing the power
concentration in the network. In the hybrid
blockchain, the controls are given to the miners
which are selected from the earlier times for
carrying out valid transactions.
According to Turk and Kline, 2017,
digitalized transactions are facilitated by the
technology of blockchain that has the features of
encryption, security and distribution in nature.
The utilization of blockchain technology in the
construction industry is observed in this paper.
As any construction project consists of a group
of people and the transaction of information
among them is necessary (Dorofeyev et al.
2018). The usability of blockchain in the
construction process is observed at the time of
information management in the planning phase
of the construction, the logbook of the project
undertaken can be improved by the use of
blockchain along with the list of resources,
people involved in the project and mainly helps
in recording the sensitive data of the project
secure (Turk and Klinc 2017). The technology is
used for dealing with the failure of the projects
as the legal consequences can be handled better.
The type of blockchain used is the hybrid
blockchain for construction projects because of
the privacy of the results developed individually
and control requirements on the data available to
the individual people associated with the project.
The most benefited area from the
introduction of cryptocurrency is the financial
section of all the businesses, enterprises and
industries. The innovation of Bitcoin has
accelerated its usefulness in smart contracts,
financial payments and managing the identity
(Xu et al. 2016). Also, another emerging
technology that is the internet of things is also
benefited from the efficient application of
blockchain. The number of cryptocurrencies
available in the market is more than two
hundred. The fairness in the transaction are
observed with the schemes of the cryptocurrency
(Liu et al. 2018). The payment of the bitcoin
occurs between peers and the miners of the
bitcoin are present in the bitcoin generation. The
paper clearly describes the process involved in
the overall transaction and payment related to
the bitcoins.
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