Blockchain Risk Management Practices in Financial Institutions: A Literature Review

Abstract

This article examines how financial institutions manage the risks associated with blockchain adoption at a time when distributed ledger technology is moving from experimental pilots into core banking, insurance and capital markets processes. The main question is how blockchain specific operational, cyber, legal and governance risks are identified, assessed and controlled within established risk management frameworks. The study uses a systematic literature review of peer reviewed research to consolidate dispersed evidence from information systems, finance and regulation. The results show that institutions tend to rely on permissioned architectures, consortia governance and layered controls to contain security, compliance and reputational risks, while many implementations remain at pilot or limited scale. The article discusses these patterns through thematic analysis of risk categories and control mechanisms. The main findings highlight that effective blockchain risk management is central to realizing promised efficiency and transparency benefits, and that robust empirical evaluations of specific practices are still relatively scarce.