Cryptocurrency vs Cash: A Security Breakdown

In the modern age, the use of cash is steadily on the decline. With a third of millennials claiming they rarely if ever carry cash anymore, the future of bank notes and coins as a payment method is being called into question.

What happens when people stop using cash? Are cryptocurrencies a viable replacement?

Many factors could influence the answers to these questions. However, as cryptocurrencies continue to become a valid and accepted form of payment in modern society—with crypto ATMs even popping up in airports and convenience stores—perhaps the biggest question is: can cryptocurrency ever be as secure as cash?

Each of these payment types comes with its own benefits and drawbacks when it comes to security. But can a cashless future ever truly be secure? We compare cryptocurrency and cash to find answers.

Cryptocurrency: Security Pros and Cons

Cryptocurrencies are hailed as a positive alternative to many other forms of digital transactions because of a greater potential for security. While not always completely anonymous—some blockchains store certain account details in transactions—cryptocurrencies exist in a highly secure network that lends itself to anonymity and security.

Through individualized blocks – that require tampering with the entire chain to succeed with an attack – blockchains can host transaction data with security unmatched by credit and debit cards. Nevertheless, the digital component of cryptocurrency means they aren’t completely without risk from cybercrime the way traditional cash is.

Here, we break down the security benefits and drawbacks of cryptocurrency versus cash.


As a means of digital banking and spending, cryptocurrencies have a lot to offer in terms of security. These benefits include:

  • Cryptographic chains offering information immutability—hackers can’t get in to change the data in your blocks.
  • Transaction information not tied to sensitive account info.
  • No physical location for targeting and theft of currency.
  • Transferability over borders and locations due to the decentralized nature of cryptocurrency.
  • Timestamped and recorded access to information in hash functions, so you can always see who accessed your data and where.
  • Convenience of digital transactions from a mobile device.
  • Physical safety of not having to handle cash—especially in a pandemic like COVID-19.

While no digital system can claim complete security from hackers, cryptocurrency has often proven more secure than traditional electronic payment and banking systems. Because of the added security, the benefits of crypto may outweigh the drawbacks.


Mobile payment security remains a concern across digital systems, even with the integration of blockchain cryptocurrencies. While both traditional systems and crypto use encryption to derail would-be hackers, no amount of protection can guarantee against cyber-attack.

Going cashless with crypto has the following drawbacks:

  • Malware threatens crypto wallets.
  • Authentication systems are required for added safety.
  • Other digital devices can serve as an entry point for data theft.
  • Security is not guaranteed.

Cryptocurrency—while frequently safer than other forms of digital transactions—are still susceptible to cyber-attacks. This susceptibility requires that holders of cryptocurrency make moves to protect their assets.

While cash also requires protective measures, there is only one entry point for cash theft—a physical location.

Cash: Security Pros and Cons

Cash can be convenient and useful. This traditional method of carrying around currency and making transactions brings anonymity and ease in many situations. However, as fewer people carry cash, the trend seems to be towards a cashless society.

The use of cash is being disrupted by finance technologies (fintech) like blockchain that conveniently and safely allows a consumer to manage their currency. In fact, 80% of banking professionals see the integration of fintech as being disruptive to the entire banking and finance industry in the near future.

Cash could be on the way out, but we’ll take a look at the benefits and drawbacks of cash that may influence this shift.


There are good reasons millions of people still carry cash despite the digital alternatives available to them. Here are some of the benefits cash currency offers the average consumer:

  • Safety from digital theft.
  • Visualization of budgeting.
  • Anonymity.
  • Ease of use.
  • Freedom from digital accounts that require sensitive information.
  • Clarity of available funds.

Old-fashioned cash will always have its appeal. Having a wallet full of actual, physical currency can help people visualize their budgeting needs without putting them at risk of cybercrime. However, carrying cash comes with its drawbacks as well.


When it comes to using cash, you aren’t free from risks. Your wallet may not be vulnerable to malware, but it is liable to the following:

  • Risk of theft from mugging and robbery.
  • Risk of loss through misplacement.
  • Inability to track location or amounts without physical access.
  • No way to receive currency back due to fraudulent use.
  • Requires access to an ATM or other in-person transaction locations.
  • Takes up physical space on a person.

Due to these drawbacks and more, the shift to a cashless society is increasingly appealing to a younger generation more accustomed and trusting of technology. But will the future really be cash-free?

A Secure Cashless Future?

Cryptocurrencies have some benefits over other forms of digital transactions possible through debit and credit cards, as well as online payment systems. The security offered by a wallet made up of cryptographic blocks means added security. The decentralized component of blockchains means less threat from cybercriminals looking to target a high-yield network. Yet, not even cryptocurrency is free from risk.

Compared to cash, the level of risk is hard to gauge. Each currency comes with its own benefits and drawbacks. Crypto can come close to offering the anonymity and lack of oversight that cash affords, yet cash still presents a less direct target while offering more privacy.

Because cryptocurrency transactions can be made safely with modern technology, the need for carrying cash will dissipate somewhat. While many will still desire the benefits and feel of cash in their pocket, a digital system has sustainability components like a reduction in textile production that may drive this shift.

Cryptocurrency may be the most secure digital currency currently on the market, yet it is unlikely digital currency systems will ever be risk-free. At the same time, cash comes with its own set of risks. The future will likely be a more cash-free place, but the abolition of cash currency altogether is certainly a long way off.

Beau Peters

Beau Peters is a creative professional with a lifetime of experience in service and care. As a manager, he's learned a slew of tricks of the trade that he enjoys sharing with others who have the same passion and dedication that he brings to his work. When he is not writing, he enjoys reading and trying new things.

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