A false negative occurs when a system fails to identify a condition that is actually present. In cryptocurrency, this often relates to security measures, particularly in fraud detection and transaction validation. For example, if a system designed to detect fraudulent transactions incorrectly flags a legitimate transaction as safe, that’s a false negative. This can lead to significant risks, allowing actual fraudulent activities to go undetected.False negatives can undermine trust in cryptocurrency platforms. If users feel that security measures are inadequate, they may be less inclined to engage with those services. In trading, false negatives can also happen with predictive algorithms that fail to recognize a profitable trading opportunity, resulting in missed gains for traders. Overall, minimizing false negatives is crucial for ensuring the safety, reliability, and effectiveness of systems in the cryptocurrency space.