Question

For the term project in this course, you will perform requirement and system analysis for cryptocurrency exchange systems to prepare a written system proposal document. It is an individual project, you shall complete the project by yourself and submit the resulting document to moodle system. The report should include all analytical and design results, including all related UML diagrams, cards, tables and sufficient text descriptions. 

CRYPTOCURRENCY EXCHANGE A cryptocurrency exchange, or a digital currency exchange (DCE), is a business that allows customers to trade cryptocurrencies or digital currencies for other assets, such as conventional fiat money or other digital currencies. The exchanges can send cryptocurrency to a user's personal cryptocurrency wallet. Some can convert digital currency balances into anonymous prepaid cards which can be used to withdraw funds from ATMs worldwide while other digital currencies are backed by real-world commodities such as gold. In this project, you will need to search information online to study the functionalities of a cryptocurrency exchange. After that, you shall perform system analysis and design for a new cryptocurrency exchange system. Please note that, cryptocurrency exchanges can be centralized (Coinbase, Biance, etc.) or decentralized (Uniswap, Bancor, etc.). You can choose either centralized or decentralized to finish your project. 

Reference: • https://en.wikipedia.org/wiki/Cryptocurrency_exchange • https://golden.com/wiki/Decentralized_cryptocurrency_exchange • https://en.wikipedia.org/wiki/Cryptocurrency • https://www.coinbase.com/ • https://www.binance.com/en • https://uniswap.org/ • https://app.bancor.network/ • https://www.youtube.com/watch?v=kVG1W0J_hGc • https://www.youtube.com/watch?v=h7RaNPM60BE • https://www.youtube.com/watch?v=Ov_BJIXcReE • https://www.youtube.com/watch?v=-xjtFbiHGoY&t=308sDOCUMENT DELIVERABLES To main task for the project is to create the report, which will be a complete set of documents (system proposal) for the proposed system. The final report contains following information: 1. Table of Contents 2. Executive Summary 3. System Request 4. Work plan 5. Feasible Analysis 6. Requirement Definition 7. Functional Model 8. Structural Models 9. Behavioral Models 10. Appendices

Answer 1

Requirements of cryptocurrency are:- (a) the availability of money; money should not be limited. Money should be able to cover most transactions in the specific region. However, the supply of cryptocurrencies is limited; (b) speculation activities, money should be used for transactions, not for speculation activities dominantly.

Analysis:- The system is decentralized and cannot be controlled by any single party in the world. Also, editing the already submitted data is, if not impossible, at least extremely unlikely to happen. This is achieved because to customize any information, enormously powerful computing power is required, and if Bitcoin is compromised, it will lose its value. So, what does the blockchain do for us, and how can one benefit from it? For a common user, blockchain in most areas of life doesn’t make much difference. However, there is an area where this technology gained the most popularity.

Fraud-proof: When cryptocurrency is created, all confirmed transactions are stored in a public ledger. All identities of coin owners are encrypted to ensure the legitimacy of record keeping.

Identity Theft: The ledger ensures that all transactions between “digital wallets” can calculate an accurate balance. All transactions are checked to make sure that the current spender owns the coins used.

• Accessible: There are over two billion people with access to the Internet who don't have the right to use traditional exchange systems. These individuals are clued-in for the crypto.

• Instant Settlement: Blockchain is the reason why cryptocurrency has any value. Ease of use is the reason why the cryptocurrency is in high demand. All you need is a smart device, an internet connection, and instantly, you become your own bank, making payments and money transfers.

• You are the owner: There is no other electronic cash system in which you own your account.

Information about Cryptocurrency:- it is digital money. That means there’s no physical coin or bill — it’s all online. You can transfer cryptocurrency to someone online without a go-between, like a bank. Bitcoin and Ether are well-known cryptocurrencies, but new cryptocurrencies continue to be created.

People might use cryptocurrencies for quick payments and to avoid transaction fees. Some might get cryptocurrencies as an investment, hoping the value goes up. You can buy cryptocurrency with a credit card or, in some cases, get it through a process called “mining.” Cryptocurrency is stored in a digital wallet, either online, on your computer, or other hardware.

Before you buy cryptocurrency, know that it does not have the same protections as using U.S. dollars. Also, know that scammers ask people to pay with cryptocurrency because they know that such payments are typically not reversible.

How Does Cryptocurrency Work?

A cryptocurrency is a medium of exchange that is digital, encrypted, and decentralized. Unlike the U.S. Dollar or the Euro, there is no central authority that manages and maintains a cryptocurrency value. Instead, these tasks are broadly distributed among cryptocurrency users via the internet.

Bitcoin was the first cryptocurrency, first outlined in principle by Satoshi Nakamoto in a 2008 paper titled “Bitcoin: A Peer-to-Peer Electronic Cash System.” Nakamoto described the project as “an electronic payment system based on cryptographic proof instead of trust.”

That cryptographic proof comes in the form of verified and recorded transactions in the form of a program called a blockchain.

What Is a Blockchain?

A blockchain is an open, distributed ledger that records transactions in code. It’s a little like a checkbook that’s distributed across countless computers around the world in practice. Transactions are recorded in “blocks” linked together on a “chain” of previous cryptocurrency transactions.

“Imagine a book where you write down everything you spend money on each day,” says Buchi Okoro, CEO and co-founder of the African cryptocurrency exchange Quidax. “Each page is similar to a block, and the entire book, a group of pages, is a blockchain.”

With a blockchain, everyone who uses a cryptocurrency has their own copy of this book to create a unified transaction record. The software logs each new transaction as it happens, and every copy of the blockchain is updated simultaneously with the new information, keeping all records identical and accurate.

Cryptocurrency exchange market:-

Firstly, it is important to mention that blockchain is, basically, a publicly available worldwide database.

Not only it allows anyone in the world to add information to it, but it also makes this information incorruptible by spreading it all over the network. The data is not stored in any particular place or on a server; it is distributed all over, making it unalterable and more secure than in the confines of any technology existing before blockchain. Additionally, it’s open-source software, so you can even create your own blockchain.

The system is decentralized and cannot be controlled by any single party in the world. Also, editing the already submitted data is, if not impossible, at least extremely unlikely to happen. This is achieved because to customize any information, enormously powerful computing power is required, and if Bitcoin is compromised, it will lose its value.

So, what does the blockchain do for us, and how can one benefit from it? For a common user, blockchain in most areas of life doesn’t make much difference. However, there is an area where this technology gained the most popularity.