The Economics of BitCoin Price Formation
AbstractThis paper analyses the relationship between BitCoin price and supply-demand fundamentals of BitCoin, global macro-financial indicators and BitCoin’s attractiveness for investors. Using daily data for the period 2009-2014 and applying time-series analytical mechanisms, we find that BitCoin market fundamentals and BitCoin’s attractiveness for investors have a significant impact on BitCoin price. Our estimates do not support previous findings that the macro-financial developments are driving BitCoin price.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Economics and Econometrics Research Institute (EERI), Brussels in its series EERI Research Paper Series with number EERI RP 2014/08.
Date of creation: 08 Jan 2014
Date of revision:
BitCoin; exchange rate; supply-demand fundamentals; financial indicators; attractiveness;
Other versions of this item:
- E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
- E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
- G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
This paper has been announced in the following NEP Reports:
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Johansen, Soren & Juselius, Katarina, 1990. "Maximum Likelihood Estimation and Inference on Cointegration--With Applications to the Demand for Money," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, Department of Economics, University of Oxford, vol. 52(2), pages 169-210, May.
- Kovenock, D. & De Vries, C.G., 1995.
"Fiat Exchange in Finite Economies,"
Purdue University Economics Working Papers
1079, Purdue University, Department of Economics.
- Dan Kovenock, 2002. "Fiat Exchange in Finite Economies," Economic Inquiry, Western Economic Association International, Western Economic Association International, vol. 40(2), pages 147-157, April.
- Kovenock, D. & de Vries, C.G., 1995. "Fiat Exchange in Finite Economies," UFAE and IAE Working Papers, Unitat de Fonaments de l'AnÃ lisi EconÃ²mica (UAB) and Institut d'AnÃ lisi EconÃ²mica (CSIC) 310.95, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
- Engle, Robert F & Granger, Clive W J, 1987. "Co-integration and Error Correction: Representation, Estimation, and Testing," Econometrica, Econometric Society, Econometric Society, vol. 55(2), pages 251-76, March.
- Gustavo Grullon, 2004. "Advertising, Breadth of Ownership, and Liquidity," Review of Financial Studies, Society for Financial Studies, Society for Financial Studies, vol. 17(2), pages 439-461.
- Brad M. Barber & Terrance Odean, 2008. "All That Glitters: The Effect of Attention and News on the Buying Behavior of Individual and Institutional Investors," Review of Financial Studies, Society for Financial Studies, Society for Financial Studies, vol. 21(2), pages 785-818, April.
- Bouoiyour, Jamal & Selmi, Refk, 2014.
"What Does Crypto-currency Look Like? Gaining Insight into Bitcoin Phenomenon,"
57907, University Library of Munich, Germany.
- Bouoiyour, Jamal & Selmi, Refk, 2014. "What Does Crypto-currency Look Like? Gaining Insight into Bitcoin Phenomenon," MPRA Paper 58133, University Library of Munich, Germany.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Julia van Hove).
If references are entirely missing, you can add them using this form.