A Study on Awareness Level & Investing pattern in Cryptocurrency in Ludhiana

Abstract

Cryptocurrencies represent a novel and evolving form of digital assets, underpinned by blockchain technology. Unlike traditional currencies, which are centralized and issued by governments or financial institutions, cryptocurrencies are decentralized and rely on cryptographic algorithms for security and transaction verification. This decentralization and the mining process—where computers or specialized hardware validate and secure transactions—are key characteristics that differentiate cryptocurrencies from traditional asset classes like stocks, commodities, or currencies.

The value of cryptocurrencies has been a subject of extensive debate. While they perform functions similar to traditional assets, such as serving as a medium of exchange and store of value, their unique characteristics—such as decentralization, volatility, and reliance on blockchain technology—raise important questions about how they should be classified. Cryptocurrencies may not fit neatly into existing categories like currencies, commodities, or technological breakthroughs. Instead, they may represent a new class of digital assets with distinct drivers of value and risk.

Empirical analysis of cryptocurrency markets often focuses on understanding how their returns correlate with traditional asset classes, such as stocks, currencies, and commodities, as well as how macroeconomic factors and market-specific factors—such as momentum—affect their performance. The key difference between cryptocurrencies and traditional asset classes is that the value and volatility of cryptocurrencies are largely driven by factors intrinsic to the cryptocurrency market itself, such as investor sentiment, network effects, and technological developments.

In terms of sectors affected by the rise of blockchain technology, industries such as finance, supply chain management, healthcare, and entertainment are already experiencing significant disruption. The development of blockchain technology has the potential to streamline processes, reduce transaction costs, and increase transparency across various sectors.