What is Preventing the Wider Use of Digital Currencies?

The aim of this paper is to broaden the discussion on the main barriers to the use of digital currencies. The main problem of the research conducted arises from the fact that trust in digital currencies is highly dependent on public opinion, legal regulations and understanding of the technical aspects. Although they offer significant advantages such as transparency, traceability and low transaction costs, the markets for cryptocurrencies are highly volatile and therefore too risky for broad social acceptance. In this paper, topological data analysis (TDA) is used to investigate multiple currencies. TDA is primarily used to gain more insight into market activity, volatility and the connection between coins or tokens, as well as information about the market itself. Given the growing interest in cryptocurrencies and investing in recent years, the paper addresses the need for informed decision making in an evolving market. Vulnerabilities in exchanges, private wallets and trading wallets are examined and analyzed.