What is a self signed certificate
What are the risks of self signing a certificate for SSL
The risks are for the client. The point of the SSL server certificate is that it is used by the client to know the server public key, with some level of guarantee that the key indeed belongs to the intended server. The guarantee comes from the CA: the CA is supposed to perform extensive verification of the requester identity before issuing the certificate.
When a client (the user and his Web browser) "accepts" a certificate which has not been issued by one of the CA that the client trusts (the CA which were embedded in Windows by Microsoft), then the risk is that the client is currently talking to a fake server, i.e. is under attack. Note that passive attacks (the attacker observes the data but does not alter it in any way) are thwarted by SSL regardless of whether the CA certificate was issued by a mainstream CA or not.
On a general basis, you do not want to train your users to ignore the scary security warning from
the browser, because this makes them vulnerable to such server impersonation attacks (which are not that hard to mount, e.g. with DNS poisoning ). On the other hand, if you can confirm, through some other way, that the certificate is genuine that one time. then the browser will remember the certificate and will not show warnings for subsequent visits as long as the same self-signed certificate is used. The newly proposed Convergence PKI is an extension of this principle. Note that this "remembered certificate" holds as long as the certificate is unchanged, so you really want to set the expiry date of your self-signed certificate in the far future (but not beyond 2038 if you want to avoid interoperability issues ).
It shall be noted that since a self-signed certificate is not "managed" by a CA, there is no possible revocation. If an attacker steals your private key, you permanently lose, whereas CA-issued certificates still have the theoretical safety net of revocation (a way for the CA to declare that a given certificate is rotten). In practice, current Web browser do not check revocation status anyway.Source: security.stackexchange.com