Abstract
Abstract We explore the impact of investors’ beliefs on cryptocurrency demand and prices using new individual-level survey data and a structural characteristics-based demand model with differentiated cryptocurrencies and heterogeneous investors. We show that younger individuals with lower incomes are more optimistic about the future value of cryptocurrencies, as are late investors. We identify the model combining observable beliefs with an instrumental variable strategy that exploits variation in the production of different cryptocurrencies. Counterfactual analyses quantify the impact on portfolio allocations and equilibrium prices of (i) (regulating) entry of late optimistic investors, and (ii) growing concerns among investors about the sustainability of energy-intensive proof-of-work cryptocurrencies. (JEL: D84, G11, G41)
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
