This document discusses blockchain technology and cryptocurrency. It begins with introductions to blockchain and cryptocurrency. It then covers technical aspects of blockchain like hashing and nodes. It discusses different types of cryptocurrencies and tokens. It also discusses decentralized marketplaces and exchanges. Specific blockchain use cases are mentioned like supply chain tracking and Estonia's digital identity system. Government approaches to blockchain from different countries are also reviewed.

1. Faces of Blockchain Technology
Dr. Christopher Devakumar
Department of Management Studies
PES University - Bangalore

2. CRYPTOCURRENCY AND BLOCKCHAIN
 Introduction - Blockchain
 Introduction - Cryptocurrency
 Technical in Blockchain
 Cryptocurrency as an Investment for
Entrepreneurs
Dr. Christopher Devakumar
Department of Management Studies

3. Introduction – Blockchain Technology
Fixed Deposit
Commodity
Bank Savings
Real Estate
Cryptocurrency
T-Bills
Govt Bonds
Mutual Funds
Gold/Silver/Copper

4. Introduction – Blockchain Technology

5. Key Differences – Indian Financial Assets vs Cryptocurrency
Issuer
Underlying
Value

6. Trust
Factor
Key Differences – Indian Financial Assets vs Cryptocurrency

7. Types of Cryptocurrency

8. Comparison

9. • Established in the year 2008
• Core service evert day transfer of money, payments, voting, land records, IP
rights, and identity all rely on intermediaries.
• Trusted record keeping systems, and the rules programmed into the software
becomes the intermediaries.
• Blockchains can be used for more than just recording the transfer of value
between two party.
• The primary benefits of cryptographic identify, historical and chronological
provenance, and the transparency of the networks complete history work
exceptionally well for many industries that require two parties to trust each
other.
Blockchain

10. Hashing - Algorithm
Transactions are recorded and
sealed . The sealed and linked to
the next block.
Blocks sealed are linked by
Hashes.
Hashes are created through a
cryptographic has function.
The out of this mathematical
process is a string of numbers and
letters of a fixed-size, for bitcoin
it is 32 bytes.

11. • Creating new bitcoin into the circulation
• "Mining" is performed using sophisticated hardware that solves an extremely complex
computational math problem.
• The first computer to find the solution to the problem receives the next block of
bitcoins and the process begins again.
• The problem that miners are trying to solve is to guess a number that, when combined
with the hashed transaction data from the block, returns an answer that is within a
specific range called ‘Nonce’. For bitcoin is a number between 0 to 4,294,967,296
Bitcoin - Miner

12. • When a computer connects to a blockchain, the computer becomes a
node.
• Nodes broadcast bitcoin transactions to other nodes throughout the
network.
• There are several classifications of nodes are available. Every network
has different roles available. Eg. When we run a node that has a
complete history of the network’s transactions and verifies all the rules
of the system is called Full Node.
• Full node verifies each transaction and block to make sure they are
compliant with the rules of the network. The network’s rule is called its
consensus system
Bitcoin - Node

13. Open to anyone in the world to participate in the functions of the
network, only limited by their access to the internet, hardware and
power.
No gating mechanism in Public node
No licensing fee
Software us held in open license such as Apache or MIT License
Prominent type of this type of network include bitcoin and Ethereum
Public blockchain Node

14. • Private Network that utilizes some blockchain technology
but not all.
• Most don’t incorporate any kind of mining and so do not
have native cryptocurrency.
• Transactions are processed by the known participants.
• Operated by consortiums such as R3
Nodes on Corda Network
DLT (Distributed Ledger Technology)
Permissioned blockchain Node

15. • A token much like cryptocurrency can act as a bearer instrument and
be used for transfer values between two parties over a blockchain
network.
• Flexible and may not be bearer instruments.
Tokens
Token Cryptocurrency
Public and private blockchains Generated by Smart
Contract
Public blockchain networks
Created with a colored Coin Generated by a consensus algorithm
Created for a special Purpose Given to miners are as a reward

16. ERC-20 – Most popular token on the Ethereum network, and other
blockchain have adopted the same rules for their tokens. One of the driving
factors for its popularity was that the ERC-20 tokens were used for
crowdfunding – IOC (Initial Coin Offering)
ERC-721 – A common use for the ERC-721 is digital collectibles. It allows
an issuer to prove uniqueness and transferability of a digital asset while
allowing each asset to be Unique.
Popular Types of Tokens

17. A decentralized marketplace is a peer to peer platform that
allows buyers and sellers to interact directly without
involving a third party.
A decentralized marketplace is a platform with a central
authority.
Decentralized Market and Exchanges
Decentralized Marketplace Centralized Exchange
Users control funds Exchanges controls funds
Transactions clear through a network Exchange clears transactions
Not licensed to operate Is licensed by the Government
Open Bazaar
ModulTrade
FundRequest

18. Bitcoin Exchanges

19. In the 2022 Budget, by way of the 2022 Bill, the definition of virtual digital
asset has been introduced to set the regulatory machinery in motion with
respect to all cryptocurrencies and NFTs. The government has retained the
power to classify or declassify any cryptocurrency and/or NFT from the casting
net of this definition. This saving provision is inserted potentially to avoid
India’s Digital Rupee or Central Bank Digital Currency (“CBDC”) i.e. the
proposed digital currency to be introduced by the Reserve Bank of India
(“RBI”) being made a subject of tax/ regulation under the 2022 Bill.
Cryptocurrency and RBI

20. The Indian Government’s stance on cryptocurrencies exhibits a word of
caution as is evident from the proposed tax regime and the administration of
the same. As per the Finance Bill, 2022 (“2022 Bill”), consequent proposed
amendments to the Income Tax Act 1961 (“IT Act”) have been made
wherein inter alia income arising from transfer of virtual digital assets
(cryptocurrencies and NFTs) shall be taxed at the rate of 30%. (ELP’s Union
Budget 2022 Analysis for detailed understanding on tax implications with
respect to virtual digital assets in India.)
Tax Analysis on Crypto

21. Supply Chain Industry
NFC – Near Field Communication
RFID – Radio Frequency IDentification
There are many startups in the supply chain Industry using blockchain
technology to increase the efficiency and automation, and reduce fraud.
Blockchain and the World Economy
Everledger OpenPort ShipChain

22. Focuses on shipment tracking and delivery, providing a fully integrated
system for the supply chain industry through the use of blockchain
contracts to help track and trace the current location and status of every
shipment and product in transit.
Visibility - Trust – Control
ShipChain

23. In the middle 19th century Western Union was founded and they
launched the wire transfer. This process uses electronic fund transfer
from one person or entity to another through telegraph network.
In late 20th century SWIFT (Society of World Wide Interbank
Financial Telecommunication became the entity responsible for
international money transfers. They facilitate the transmission of
messages between banks.
End of 20th century PayPal transformed the movement of money.
Allows the individuals to pay for the service online with confidence and
has been instrumental in transforming the internet.
Cross Border Money Transfer

24. Estonia’s e-Residency
Estonia launched digital ID cards for online services and has offered citizenship as
a service by being the first country to offer e-Residency.
“Single window principle” – SPOC for all their government and banking needs.
Distributed ledger on Cloud.
Enhance Scalability, resilience, and data security of tax reporting and online health
care advice.
Blockchain and People – Case

25. • Smart Cities of China – Hangzhou
• U.S. Department of Homeland Security
• Singapore’s Smart Nation Project
• China’s whole country strategy
• Dubai’s 2020 Global
• BitLicence of New York City
• French blockchain efforts
• Malta, the Blockchain island of the EU
• German Blockchain
To Ponder

27. THANK YOU
Dr. Christopher Devakumar
Department of Management Studies