The rise of digital assets and the need for risk management

The proliferation of digital assets has reshaped the financial landscape, hence offering new avenues for investment, innovation and inclusion. Digital assets such as Bitcoin and Ethereum have transitioned from niche curiosities to mainstream financial instruments whilst decentralised finance (DeFi) platforms have enabled peer-to-peer transactions without intermediaries. However, this rapid growth has also highlighted the need for robust risk management practices to protect investors, institutions and the broader ecosystem. Initially, the allure of high returns in the digital asset space often overshadowed concerns about risk; early adopters and speculative investors prioritised growth and adoption over security and stability. However, high-profile incidents such as exchange hacks, market crashes and regulatory crackdowns have underscored the critical importance of managing risks in this volatile and fast-evolving market. Lessons learned in digital asset risk management include:

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