SoK: Design, Vulnerabilities and Defense of Cryptocurrency Wallets

The rapid growth of decentralized digital currencies, enabled by blockchain technology, has ushered in a new era of peer-to-peer transactions, revolutionizing the global economy. Cryptocurrency wallets, serving as crucial endpoints for these transactions, have become increasingly prevalent. However, the escalating value and usage of these wallets also expose them to significant security risks and challenges. This research aims to comprehensively explore the security aspects of cryptocurrency wallets. It provides a taxonomy of wallet types, analyzes their design and implementation, identifies common vulnerabilities and attacks, and discusses defense mechanisms and mitigation strategies. The taxonomy covers custodial, non-custodial, hot, and cold wallets, highlighting their unique characteristics and associated security considerations. The security analysis scrutinizes the theoretical and practical aspects of wallet design, while assessing the efficacy of existing security measures and protocols. Notable wallet attacks, such as Binance, Mt. Gox are examined to understand their causes and consequences. Furthermore, the paper surveys defense mechanisms, transaction monitoring, evaluating their effectiveness in mitigating threats

Cryptocurrencies Advantages and Disadvantages: A Review

Abstract. With the rapid spread of technology in all sectors of life and the necessary need to increase the speed of payment processes, confidentiality, and privacy in business operations, cryptocurrencies appeared. The cryptocurrency is a virtual and intangible currency, in which transactions are made through the Internet and without any physical exchange between parties. These currencies are characterized by decentralization, transparency, privacy. Because transactions are carried out through a cryptography process and depend on Blockchain technology it is highly protected. Blockchain generally is a distributed ledger or a decentralized database. The Blockchain architecture combines advanced cryptography, distributed consensus mechanisms, and a complex system of incentives and rewards. In cryptocurrency, transactions are created, transferred, and verified through an integrated process called mining. Network members (network nodes) who carry out verification processes of transactions are called miners. As it is a credit or debit card used in banking transactions, in cryptocurrencies there is a so-called electronic wallet that is used for transactions that take place on cryptocurrencies over the Internet through computers or smartphones. Blockchain technology architecture has given cryptocurrencies many advantages and features that increase its strength and distinction from regular currencies and regular financial transactions such as decentralization, high confidentiality, anonymity, speed of transactions, very low fees, unlimited number of transactions, unrestricted by geography and borders, transparency, protection from Inflation, and the peer-to-peer network. The misuse of powerful features in cryptocurrencies and Blockchain technology has led to many disadvantages such as the risks of lack of knowledge, the lack of wide acceptance, the high risk of investing in them, its volatile nature, and the inability to return missing payments. This study concentrates on cryptocurrencies in terms of advantages and disadvantages

Value Creation in Cryptocurrency Networks: Towards A Taxonomy of Digital Business Models for Bitcoin Companies

Cryptocurrency networks have given birth to a diversity of start-ups and attracted a huge influx of venture capital to invest in these start-ups for creating and capturing value within and between such networks. Synthesizing strategic management and information systems (IS) literature, this study advances a unified theoretical framework for identifying and investigating how cryptocurrency companies configure value through digital business models. This framework is then employed, via multiple case studies, to examine digital business models of companies within the bitcoin network. Findings suggest that companies within the bitcoin network exhibits six generic digital business models. These six digital business models are in turn driven by three modes of value configurations with their own distinct logic for value creation and mechanisms for value capturing. A key finding of this study is that value-chain and value-network driven business models commercialize their products and services for each value unit transfer, whereas commercialization for value-shop driven business models is realized through the subsidization of direct users by revenue generating entities. This study contributes to extant literature on value configurations and digital businesses models within the emerging and increasingly pervasive domain of cryptocurrency networks