How can the risks imposed by cryptocurrencies be mitigated and managed?

This issue can be addressed by regulation. Regulators all around the globe (including the United States, Singapore, Japan, Dubai, and the United Kingdom) have developed regulations to address this problem. Licensed intermediaries (crypto-exchanges) can assist the regulator in maintaining monitoring and control over cryptocurrency transactions by requiring dealers to undergo thorough know-your-customer (KYC) checks, implement anti-money laundering procedures, and keep transaction records. Existing financial organizations, such as banks and stock exchanges, use this method to maintain track of transactions and verify customer identification.
All necessary authorities may access a dashboard that provides real-time trading data on all exchange users in India, and cryptocurrency trading can be limited to just those individuals whose addresses have been whitelisted by regulated exchanges in India. These capabilities can provide the regulator a lot of power in terms of monitoring cryptocurrency flows and limiting them to verified/legitimate users. We also suggest Aadhar-based e-KYC, required capitalization requirements, the establishment of a single repository with information on banned users, and the establishment of an investor protection and education fund.