FINANCIAL RISK MANAGEMENT IN THE CRYPTOCURRENCY MARKET: AN ANALYSIS DRIVEN BY MACHINE LEARNING
A popular payment method, cryptocurrency has several risks that affect risk assessors' basic assessment. The financial industry has historically been at risk from the development of crypto-currencies due to the possibility of laundering currency. Within the realm of financial institutions, such as anti-money laundering regulations, banks, and privacy laws, risk professionals, bank executives, and law enforcement officials look into connected digital currency transactions as well as consumers hiding money laundering. The goal of the current study is to use machine learning to examine financial risk management in the Bitcoin market. The study was carried out in multiple contexts and multiple states from December 2023 to April 2024. The current study integrates unrestricted machine learning with the cryptocurrency framework. The professional accounting practice about the likelihood of occurrence and impact on the financial declaration of the possible risks related to cryptocurrencies, recognizing the risks connected to cryptocurrency, such as the potential for the significant probability of occurrence and illegal possession of private information. Those with professional cryptocurrency transaction expertise are more cautious than those with fewer years of experience. The Hierarchical Risk Parity approach works better at delivering the adjusted risk tail and generating superior risk management results. The model's proposed resilience, it was determined, is to covariance window estimations and various adjusted durations.