Cryptocurrencies represent a significant shift in the world of finance. The case of Bitcoin, the world’s largest cryptocurrency, is an example as, over the years, it has found its strength as a long-term investment vehicle and a store of value. During the course of its decade-long existence, the crypto-ecosystem has also been at the end of cyber-attacks and has had to focus on making it more robust in order to not lose out on users and investors.
Interestingly, the impact of cyber-attacks on prominent cryptocurrencies is likely to also provide greater insight into the nuances of the crypto-market.
A recent research paper titled “Cyber Attacks, Spillovers, and Contagion in the Cryptocurrency Markets,” tried to understand the situations in which volatility spillovers happen between cryptocurrencies like Bitcoin, Litecoin, and Ethereum, while also expanding on to what degree cyber-attacks play a role in it.
The paper argued that there are interdependencies that occur during cyber-attacks and that ‘spillover parameters’ are influenced by it. It also noted that cyber-attacks do play a role in strengthening cross-market linkages.
For most stakeholders and investors, portfolio…
