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Risk and Return of Digital Currency: An Understanding Based on Behavioral Finance

Shan Liu


With the increasing influence of digital currencies in global financial markets, it is especially important to understand their risk and return characteristics. This paper first describes the development status and characteristics of digital currency, and then, through the use of behavioral finance theory, reveals the problems existing in the current understanding of digital currency risks. Furthermore, this paper proposes a series of coping strategies for digital currency risks and evaluates the effectiveness of these strategies. Finally, the future research trends are prospected. This research aims to promote a deep understanding of digital currency risks and returns and provide effective management strategies.


Digital Currency; Behavioral Finance; Risk; Return; Strategy

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DOI: http://dx.doi.org/10.18686/fm.v8i4.9585