Crypto-Asset Trading Risk Governance

This paper examines crypto-asset trading risk as a multidimensional governance problem within digital financial platforms. It combines a governance-oriented risk framework with empirical evidence derived from daility market data for Bitcoin, Ethereum, Binance Coin and the S&P 500 over the 2020-2025 period. The empirical design integrates descriptive risk indicators, maximum drawdown measures, correlation analysis, event-window analysis surrounding the Terra-Luna collapse, the FTX failure and major MiCA regulatory milestones, and GARCH (1,1) volatility modelling. The findings demonstrate that crypto-assets exhibit substantially higher volatility and deeper drawdowns than the equity-market benchmark, alongside pronounced volatility clustering, persistent conditional variance and event-sensitive downside reactions. Correlations among crypto-assets are generally stronger than their correlations with the S&P 500, indicating limited diversification benefits during period od market stress. The paper contributes to management and platform-governance research by translating market technological, operational, regulatory and behavioral risks into concrete implications for exchanges, custodians, investors and regulators.  The results support transparent custody and segregation rules, standardized risk disclosure, continuous volatility and liquidity monitoring, stronger cybersecurity and compliance systems, effective incident-response mechanisms, and targeted investor education. These measures are particularly important as regulatory frameworks such as MiCA seek to improve market integrity, accountability and investor protection without constraining financial innovation.