THE RISKS OF OPERATING A CRYPTOCURRENCY BUSINESS

Abstract

The article is devoted to the study of theoretical and practical aspects of the risks that accompany the activities of economic actors in the cryptocurrency market (both mining and trading) at the micro- and macro-economic level at the beginning of the third decade of the XXI century. The risks associated with the functioning of economic entities in the market of cryptocurrency coins and such risks are the following: lack of legal regulation on the cryptocurrency market and insurance of owners of assets stored on crypto wallets; use of malware in order to access assets rotating on the cryptocurrency market; hacking attacks on cryptocurrency wallets and exchanges in order to steal cryptoassets; loss of assets deposited into accounts of cryptocurrency exchanges in case of bankruptcy or closure of these exchanges; loss of the password used to access the crypto wallet; loss of a secret personal PIN code, which is the key to access funds deposited into the crypto wallet at the exchange and used to transfer assets (cryptocurrencies or fiat currencies) to other crypto wallets or a bank card; erroneous transaction due to one number or letter mistake when transferring from one crypto wallet to another or error (when entering bank card number), when transferring funds from crypto wallet to bank card, a mistake of one or more numbers is possible and funds will be transferred to the wrong addressee, in both cases it is impossible to cancel the transaction and funds are lost irrevocably; significant volatility in the value of cryptocurrencies, because of which an investor can go bankrupt. It was revealed that the functioning of the cryptocurrency market is also associated with risks to the national economy and security: monetary policy (reduction of control over monetary circulation due to the replacement of national fiat currency with cryptocurrency coins and the loss of the central bank monopoly on the emission of money and reducing the country's income from seigniorage due to mining cryptocurrencies), financial stability (because of the threat of the outflow of deposits from the banking system and replacing them with investments in cryptocurrencies, the possibility of replacing traditional banking, as well as the possibility of avoiding taxation and shadowing the economy) and national security. It has been proven that the intensive activity of an economic entity associated with mining, trading, investing or other economic activities in the cryptocurrency market requires significant theoretical and practical training of the individual and patience and faith in the future of cryptocurrency market activity because of the probability of losing savings invested in cryptocurrencies or investments.