A Depth Analysis of Cryptocurrency's Role and Risks in Modern Finance: In Respective of Security Aspects

Abstract

The rise of cryptocurrencies has become revolutionary in modern financial landscape. It has been introduced decentralized or peer to peer transaction system which doesn't need the intermediaries such as banks or governments. In this chapter we delve into the multifaceted security aspects related to cryptocurrency both its inherent and potential risks. Initially the chapter outlines the fundamental concepts of block chain technology, under which all cryptocurrencies are underpinned and emphasized on the transparency and immutability. It also critically examined the various security aspects employed by cryptocurrencies which includes cryptographic algorithms, consensus protocols like proof of work and proof of stake and wallet security features. Despite this advancement, the chapter also highlights significant vulnerabilities like susceptibility to cyber-attacks, hacking and phishing incidents and the challenges of securing private keys. In this chapter only secondary data has been used. The overall research was done by going through so many different research paper related to cryptocurrencies and blockchain technology used in it. It also includes why and How security concerns are prime in cryptocurrency and what are the risk associated with investment in cryptocurrencies. In other words, this study explores the role and risk of modern finance especially in cryptocurrency.