IDEAS home Printed from https://ideas.repec.org/a/gam/jfinte/v3y2024i3p20-378d1441456.html
   My bibliography  Save this article

Dynamics between Bitcoin Market Trends and Social Media Activity

Author

Listed:
  • George Vlahavas

    (School of Informatics, Aristotle University of Thessaloniki, 54124 Thessaloniki, Greece)

  • Athena Vakali

    (School of Informatics, Aristotle University of Thessaloniki, 54124 Thessaloniki, Greece)

Abstract

This study examines the relationship between Bitcoin market dynamics and user activity on the r/cryptocurrency subreddit. The purpose of this research is to understand how social media activity correlates with Bitcoin price and trading volume, and to explore the sentiment and topical focus of Reddit discussions. We collected data on Bitcoin’s closing price and trading volume from January 2021 to December 2022, alongside the most popular posts and comments from the subreddit during the same period. Our analysis revealed significant correlations between Bitcoin market metrics and Reddit activity, with user discussions often reacting to market changes. Additionally, user activity on Reddit may indirectly influence the market through broader social and economic factors. Sentiment analysis showed that positive comments were more prevalent during price surges, while negative comments increased during downturns. Topic modeling identified four main discussion themes, which varied over time, particularly during market dips. These findings suggest that social media activity on Reddit can provide valuable insights into market trends and investor sentiment. Overall, our study highlights the influential role of online communities in shaping cryptocurrency market dynamics, offering potential tools for market prediction and regulation.

Suggested Citation

  • George Vlahavas & Athena Vakali, 2024. "Dynamics between Bitcoin Market Trends and Social Media Activity," FinTech, MDPI, vol. 3(3), pages 1-30, July.
    • Handle: RePEc:gam:jfinte:v:3:y:2024:i:3:p:20-378:d:1441456
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2674-1032/3/3/20/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2674-1032/3/3/20/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Corbet, Shaen & Lucey, Brian & Yarovaya, Larisa, 2018. "Datestamping the Bitcoin and Ethereum bubbles," Finance Research Letters, Elsevier, vol. 26(C), pages 81-88.
    2. Breidbach, Christoph F. & Tana, Silviana, 2021. "Betting on Bitcoin: How social collectives shape cryptocurrency markets," Journal of Business Research, Elsevier, vol. 122(C), pages 311-320.
    3. Kraaijeveld, Olivier & De Smedt, Johannes, 2020. "The predictive power of public Twitter sentiment for forecasting cryptocurrency prices," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 65(C).
    4. Agosto, Arianna & Cerchiello, Paola & Pagnottoni, Paolo, 2022. "Sentiment, Google queries and explosivity in the cryptocurrency market," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 605(C).
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ştefan Cristian Gherghina & Liliana Nicoleta Simionescu, 2023. "Exploring the asymmetric effect of COVID-19 pandemic news on the cryptocurrency market: evidence from nonlinear autoregressive distributed lag approach and frequency domain causality," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 9(1), pages 1-58, December.
    2. Assaf, Ata & Demir, Ender & Ersan, Oguz, 2024. "Detecting and date-stamping bubbles in fan tokens," International Review of Economics & Finance, Elsevier, vol. 92(C), pages 98-113.
    3. Andreas Hackethal & Tobin Hanspal & Dominique M Lammer & Kevin Rink, 2022. "The Characteristics and Portfolio Behavior of Bitcoin Investors: Evidence from Indirect Cryptocurrency Investments [The investor in structured retail products: advice driven or gambling oriented]," Review of Finance, European Finance Association, vol. 26(4), pages 855-898.
    4. Almeida, José & Gonçalves, Tiago Cruz, 2023. "A systematic literature review of investor behavior in the cryptocurrency markets," Journal of Behavioral and Experimental Finance, Elsevier, vol. 37(C).
    5. Ahmad Harith Ashrofie Hanafi & Mohd Shahid Azim Mohd Saufi & Muhammad Zarunnaim Haji Wahab & Suheil Che Sobry & Mohd Hilal Muhammad, 2024. "Bridging the Gap: A Bibliometric Review of Cryptocurrency and Conventional Market Interactions in Academic Research," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 8(9), pages 1114-1131, September.
    6. M. Ben Osman & C. Urom & K. Guesmi & R. Benkraiem, 2024. "Economic sentiment and the cryptocurrency market in the post-COVID-19 era," Post-Print hal-04631232, HAL.
    7. Demir, Ender & Simonyan, Serdar & García-Gómez, Conrado-Diego & Lau, Chi Keung Marco, 2021. "The asymmetric effect of bitcoin on altcoins: evidence from the nonlinear autoregressive distributed lag (NARDL) model," Finance Research Letters, Elsevier, vol. 40(C).
    8. Suardi, Sandy & Rasel, Atiqur Rahman & Liu, Bin, 2022. "On the predictive power of tweet sentiments and attention on bitcoin," International Review of Economics & Finance, Elsevier, vol. 79(C), pages 289-301.
    9. Osman, Myriam Ben & Urom, Christian & Guesmi, Khaled & Benkraiem, Ramzi, 2024. "Economic sentiment and the cryptocurrency market in the post-COVID-19 era," International Review of Financial Analysis, Elsevier, vol. 91(C).
    10. Shahzad, Syed Jawad Hussain & Anas, Muhammad & Bouri, Elie, 2022. "Price explosiveness in cryptocurrencies and Elon Musk's tweets," Finance Research Letters, Elsevier, vol. 47(PB).
    11. Bui, Mai & Pham, Huy & Nguyen Thanh, Binh & Tiwari, Aviral Kumar, 2024. "Revisiting the determinants of cryptocurrency excess return: Does scarcity matter?," International Review of Economics & Finance, Elsevier, vol. 96(PC).
    12. Samet Gunay & Emrah Ismail Cevik & Mehmet Fatih Bugan & Sel Dibooglu & Mehmet Akif Destek, 2025. "Time and frequency domain relationship between investor sentiment and sectoral cryptocurrencies," Economic Change and Restructuring, Springer, vol. 58(3), pages 1-32, June.
    13. Cynthia Weiyi Cai & Rui Xue & Bi Zhou, 2023. "Cryptocurrency puzzles: a comprehensive review and re-introduction," Journal of Accounting Literature, Emerald Group Publishing Limited, vol. 46(1), pages 26-50, June.
    14. Assaf, Ata & Bilgin, Mehmet Huseyin & Demir, Ender, 2022. "Using transfer entropy to measure information flows between cryptocurrencies," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 586(C).
    15. Yang Hu, 2023. "A review of Phillips‐type right‐tailed unit root bubble detection tests," Journal of Economic Surveys, Wiley Blackwell, vol. 37(1), pages 141-158, February.
    16. Christie Smith & Aaron Kumar, 2018. "Crypto‐Currencies – An Introduction To Not‐So‐Funny Moneys," Journal of Economic Surveys, Wiley Blackwell, vol. 32(5), pages 1531-1559, December.
    17. Yousaf, Imran & Youssef, Manel & Goodell, John W., 2022. "Quantile connectedness between sentiment and financial markets: Evidence from the S&P 500 twitter sentiment index," International Review of Financial Analysis, Elsevier, vol. 83(C).
    18. Ata Assaf & Luis Alberiko Gil-Alana & Khaled Mokni, 2022. "True or spurious long memory in the cryptocurrency markets: evidence from a multivariate test and other Whittle estimation methods," Empirical Economics, Springer, vol. 63(3), pages 1543-1570, September.
    19. Parthajit Kayal & Purnima Rohilla, 2021. "Bitcoin in the economics and finance literature: a survey," SN Business & Economics, Springer, vol. 1(7), pages 1-21, July.
    20. Vidal-Tomás, David, 2022. "The new crypto niche: NFTs, play-to-earn, and metaverse tokens," Finance Research Letters, Elsevier, vol. 47(PB).

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jfinte:v:3:y:2024:i:3:p:20-378:d:1441456. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.