Cryptocurrency Industry Research Articles

Bitcoin ETF: Opportunities and risk

The year 2024 witnessed a major development in the cryptocurrency industry with the long-awaited approval of spot Bitcoin exchange-traded funds (ETFs). This innovation provides investors with a new, regulated path to gain exposure to Bitcoin through a familiar investment vehicle (Kumar et al., 2024). However, unlike traditional ETFs that directly hold underlying assets, Bitcoin ETFs rely on a creation and redemption process managed by authorized participants (APs). This unique structure introduces distinct characteristics in terms of premium/discount behavior compared to traditional ETFs. This paper investigates the premium and discount patterns observed in Bitcoin ETFs during first four-month period (January 11th, 2024, to May 17th, 2024). Our analysis reveals that these patterns differ significantly from those observed in traditional index ETFs, potentially exposing investors to additional risk factors. By identifying and analyzing these risk factors associated with Bitcoin ETF premiums/discounts, this paper aims to achieve two key objectives: · Enhance market understanding: Equip and market and investors with a deeper comprehension of the unique liquidity risks inherent in Bitcoin ETFs. · Provide a clearer risk management frameworks: Offer a clearer perspective on the risk-return profile of digital asset ETFs, specifically focusing on Bitcoin ETFs. Through a thorough analysis of premium/discount behavior and the underlying factors contributing to it, this paper strives to contribute valuable insights for investors navigating the evolving landscape of digital asset investments

Consumer Behavior in the World of Cryptocurrencies

Abstract Cryptocurrencies are a new form of digital assets that have gained increasing popularity in recent years. Investors have a dual objective of maximizing profits while minimizing risks. In today's world, there is an increase in the demand for cryptocurrencies, with focus on the emotional aspects as well as on the underlying technical analysis. This abstract provides a synthesis of recent research and insights into the behavior of consumers engaging with cryptocurrencies. Key determinants such as trust, perceived usefulness, and ease of use play pivotal roles in driving consumer adoption of cryptocurrencies. Furthermore, behavioral uncertainty and risk perception emerge as critical considerations impacting investment decisions within this dynamic ecosystem. The abstract also highlights the significant influence of digital platforms and social media on shaping consumer attitudes and behaviors towards cryptocurrencies, underscoring the importance of online discourse and information dissemination in this context. As the cryptocurrency market develops and grows, understanding consumer behavior becomes increasingly paramount for stakeholders, policymakers, and researchers alike. By unraveling the complexities of consumer preferences, motivations, and perceptions, this abstract offers valuable perspectives to inform strategic decision-making and foster sustainable growth in the cryptocurrency industry. This research was based on scientific articles and carefully selected and studied important data from trusted sources like academic journals, financial databases, and websites focusing on cryptocurrency information.

On the robust drivers of cryptocurrency liquidity: the case of Bitcoin

This study aims to identify the factors that robustly contribute to Bitcoin liquidity, employing a rich range of potential determinants that represent unique characteristics of the cryptocurrency industry, investor attention, macroeconomic fundamentals, and global stress and uncertainty. To construct liquidity metrics, we compile 60-min high-frequency data on the low, high, opening, and closing exchange rates of Bitcoin against the US dollar. Our empirical investigation is based on the extreme bounds analysis (EBA), which can resolve model uncertainty issues. The results of Leamer’s version of the EBA suggest that the realized volatility of Bitcoin is the sole variable relevant to explaining liquidity. With the Sala-i-Martin’s variant of EBA, however, four more variables, (viz. Bitcoin’s negative returns, trading volume, hash rates, and Google search volume) are also labeled as robust determinants. Accordingly, our evidence confirms that Bitcoin-specific factors and developments, rather than global macroeconomic and financial variables, matter for explaining its liquidity. The findings are largely insensitive to our proxy of liquidity and to the estimation method used.

Unveiling Interconnectedness and Volatility Transmission: A Novel GARCH Analysis of Leading Global Cryptocurrencies

The cryptocurrency industry has grown erratically and at an alarming pace during its brief life. It has received massive attention from the practitioners, academicians, and especially media since Bitcoin was introduced in 2009. The current paper investigates the volatility dynamics of five major cryptocurrencies, namely Bitcoin, Ethereum, Litecoin, DASH and Ripple’s XRP. It discloses the impact of volatility in the prices of other cryptocurrencies on the Bitcoin’s price volatility. The time series of all the cryptocurrencies prices for the period 2016 to 2022 are considered and preliminary analysis highlights that there exists conditional volatility in all the cryptocurrencies which allows us to use the family of GARCH model. The research findings reveal the significant effect of asymmetric past shocks on the current volatility of Bitcoins. Further, the volatility of remaining virtual currencies are also significantly affecting the Bitcoin’s current volatility. Therefore, the present study unveils the absence of diversification benefits in the market of virtual assets as significant effect of price volatility of other digital coins has been found on the price volatility of Bitcoins. The practical implication of our study is that the findings offer new information for investors and portfolio managers, who are attracted to invest in or hedging strategies in cryptocurrencies.

Analyzing social media reactions to the FTX crisis: Unraveling the spillover effect on crypto markets

AbstractIn this study, we analyzed social media conversations during the unfolding of the FTX crisis, the biggest cryptocurrency scandal in United States history. Drawing on the accessibility‐diagnosticity framework, we examined the negative spillover effect of the crisis using a natural language processing approach. We specifically assessed whether there was a negative spillover from FTX to other crypto entities with different levels of diagnostic attribute similarity. We collected a large corpus of Twitter conversations related to the FTX collapse in 2022 and used the association rule analysis to determine the association between FTX and other crypto entities. Our analysis revealed that the number of tweets mentioning FTX and other crypto entities changed in line with a series of real‐world events during the FTX crisis. The negative spillover of the FTX crisis occurred primarily during the first 10 days as the FTX scandal unfolded. The results indicated that the FTX crisis spilled over to highly accessible and diagnostic crypto entities, such as Binance, Bitcoin, and the cryptocurrency industry in general. On the other hand, less accessible and less diagnostic crypto entities/currencies like Ethereum and Coinbase did not experience negative spillover from the scandal.

Forecasting and Analysis of Cryptocurrency Trends

The development of financial technology has given rise to a new class of asset known as cryptocurrency, which has presented a significant potential for study. Forecasting cryptocurrency prices is challenging because of their dynamic and volatile nature. There are hundreds of different cryptocurrencies in circulation today. With prospects in peer-to-peer payments, remittance, e-commerce and retail, and media & entertainment, the cryptocurrency business appears to have a bright future. From 2019 to2024, the worldwide cryptocurrency industry is anticipated to expand at a 32% CAGR. The distributed ledger technology's immutability and transparency, the rise in remittances from poor nations, shifting monetary laws, and a sharp rise in venture capital investments are the main factors propelling this market's growth. We created a short-term prediction (between five and thirty days) for the cryptocurrencies using the ARIMA model. When it came to predicting cryptocurrency time series, we discovered that the suggested method outperformed the ARIMA-ARFIMA models in both periods of gradual rising (falling) and transition dynamics (change of trend). Index Terms: digital currency,cryptocurrency, and ARIMA model.

Exploration of Solutions to Regulate the Cryptocurrency Industry: A Critical Analysis of Conventional Auditing Solution

Exploration of Solutions to Regulate the Cryptocurrency Industry: A Critical Analysis of Conventional Auditing Solution

Blockchain transaction analysis: a comprehensive review of applications, tasks and methods

Blockchain transaction analysis is a powerful tool to gain insights into the actions and conduct of participants within blockchain networks. This article aims to extensively examine the applications, tasks, and methods associated with blockchain transaction analysis. We look at various uses of transaction analysis, ranging from its instrumental role in blockchain development to its pivotal significance in the field of criminal investigations. By leveraging common techniques and technologies employed in conducting such an analysis, we unlock hidden insights and uncover information that is not visible at first look. This article offers a wide-ranging perspective on the profound significance of blockchain transaction analysis while shedding light on its key role within the cryptocurrency industry and its wide-ranging applications beyond.

The collapse of the FTX exchange: The end of cryptocurrency's age of innocence

The sudden collapse of the FTX exchange appears to have unearthed several fundamental ethical, regulatory, and policy-based flaws, inherently damaging the cryptocurrency industry at large. The following research outlines the key events that led to the bankruptcy of FTX while examining industry-wide implications as a consequence of an acute risk management failure. Results indicate severe risk and liquidity imbalances between the assets and liabilities of FTX, which contributed to the collapse of the exchange and subsequently led to contagion effects across a range of financial market products. The insolvency of FTX should serve as a significant warning to policymakers and regulators, specifically surrounding the valuation, reserving, and corporate usage of permissionless, privately-issued cryptocurrencies.

CryptoAudit: Nature, requirements and challenges of Blockchain transactions audit

CryptoAudit, the process of auditing cryptocurrencies and blockchain-based transactions, is essential in ensuring the accuracy, security, and compliance of activities within the emerging digital asset landscape. This paper explores the unique challenges faced in CryptoAudit, including the absence of a comprehensive regulatory framework, the complexities of blockchain technology, security concerns, valuation difficulties, and the global nature of cryptocurrencies. It also highlights the differences between CryptoAudit and traditional financial audit, emphasizing the need for specialized expertise and adaptability in this evolving field. The study employs a literature review approach and AI-based data analysis to provide insights into existing research and publications related to CryptoAudit. Key findings reveal the importance of staying updated on regulatory developments, collaborating with experts, and developing specialized audit procedures to address these challenges effectively. While CryptoAudit presents significant obstacles, it also offers opportunities for enhancing transparency, efficiency, and trust in the digital financial ecosystem. Auditors play a critical role in ensuring the reliability of cryptocurrency audits, fostering confidence, and facilitating the integration of blockchain technology into accounting and auditing practices. As the cryptocurrency industry continues to evolve, auditors must remain proactive and adaptable to navigate this complex landscape successfully.

PROMISING AREAS FOR THE DEVELOPMENT OF THE CRYPTOCURRENCY INDUSTRY IN UKRAINE AS A TOOL FOR INTENSIFYING FOREIGN TRADE ACTIVITIES OF ENTREPRENEURIAL STRUCTURES

In recent years, the cryptocurrency industry has been developing rapidly, creating new opportunities and challenges for investors, entrepreneurs, and policymakers. Ukraine has become a promising destination for investment in cryptocurrencies and blockchain development due to its favorable business environment, highly educated workforce, and growing technology sector. Organizational and economic support for the development of foreign trade activities of Ukrainian businesses in the context of the cryptocurrency industry includes a thorough analysis and development of strategies to use these opportunities.In this article, we have considered some promising areas for the development of the cryptocurrency industry in Ukraine using general scientific and special methods of scientific knowledge, such as analytical methods, comparative analysis, methods of comparison, and generalization. From the potential of blockchain-based e-government services to the possibilities of mining and trading cryptocurrencies, the article examines the country's strengths and opportunities in this area and identifies ways to use them for future growth.To this end, the author analyzes the legal framework, the state and degree of development of the blockchain, the peculiarities and pace of mining, the degree of acceptance of cryptocurrencies in society, and the state and peculiarities of the development of cryptocurrency exchanges. Understanding the potential of the cryptocurrency industry in Ukraine, we believe that the strategic directions for promoting economic growth and technological innovation in the country are: a clear regulatory framework, a skilled workforce, abundant energy resources, and a growing number of cryptocurrency changes.These elements of organizational and economic support will help Ukrainian businesses to develop their foreign trade activities in the context of the growing influence of the cryptocurrency sphere, providing greater opportunities for investment and trade, as well as promoting the introduction of innovative technologies and increasing international competitiveness.

Prospects for the Incorporation of the Digital Ruble into Russia’s Monetary Turnover: Attributes and Principles for Developing a Trusted Digital Environment

The rapid nature of the modernization of monetary turnover, accompanied by geopolitical risks against the background of post-pandemic economic recovery and the regionalization process, no longer just arouses the discursive interest of society, but becomes an indispensable condition of the new reality. The process of money turnover transformation by introducing digital currencies into circulation in the wave of digitalization among world powers lagging behind the evolving environment of the cryptocurrency industry is developing into a process of formalization of metaverses and penetrates deeper into the socio-economic reality. The problem of the Russian practice of developing the payment environment consists in its catching-up character, caused by the spontaneous formation of the digital society, resulting in the expansion of the scope of alternative finance outside the legal field. The purpose of the paper is to determine the inherent attributes of the digital trusted environment necessary to ensure digital ruble turnover, based on an empirical study of society’s perceptions about the prospects for using the digital form of the national monetary unit by representatives of various generations. We used systematization, grouping, comparative and content analysis, surveys, and the quota method to achieve the paper’s purpose. The survey involved 35,327 residents from different regions. As a result, the authors revealed the low level of readiness of society for the introduction of the digital ruble as a substitute for cash and cryptocurrency. The paper focuses on the need for an integrated approach to the disclosure of the digital ruble’s value and benefits, which contributes to its successful launch and promotion in the market. The results of the research highlight the importance of correspondence in the digital ruble category “digital currencies”, and also the impossibility of making incorrect decisions in the transformation of money turnover, which leads to the growth of risks of digital inequality, the clash of interests of certain groups of the population in the prevailing behavioral patterns in the form of a cautious attitude to digital finance with insufficient financial literacy.

The impact of regulation on cryptocurrency market volatility in the context of the COVID-19 pandemic — evidence from China

This paper aims to examine the impact of regulatory policies on cryptocurrency market volatility in the context of the COVID-19 pandemic. We find that price volatility, liquidity volatility, and return volatility in the cryptocurrency market increased significantly following regulatory announcements by Chinese policymakers targeting the cryptocurrency industry, and this effect was more pronounced during the COVID-19 pandemic. It indicates that investors are paying a great deal of attention to such events. Yet further findings suggest that as the risk of pandemic transmission increases and stock market returns decline, investor response to regulation decreases. Our findings also suggest that while regulation typically brings market volatility in cryptocurrencies, the release of regulatory policies can instead be beneficial to the stability of the cryptocurrency market when investors are in an highly greedy mood.

A Dataset of Coordinated Cryptocurrency-Related Social Media Campaigns

The rise in adoption of cryptoassets has brought many new and inexperienced investors in the cryptocurrency space. These investors can be disproportionally influenced by information they receive online, and particularly from social media. This paper presents a dataset of crypto-related bounty events and the users that participate in them. These events coordinate social media campaigns to create artificial "hype" around a crypto project in order to influence the price of its token. The dataset consists of information about 15.8K cross-media bounty events, 185K participants, 10M forum comments and 82M social media URLs collected from the Bounties(Altcoins) subforum of the BitcoinTalk online forum from May 2014 to December 2022. We describe the data collection and the data processing methods employed and we present a basic characterization of the dataset. Furthermore, we discuss potential research opportunities afforded by the dataset across many disciplines and we highlight potential novel insights into how the cryptocurrency industry operates and how it interacts with its audience.

Exploring Relationships among Crude Oil, Bitcoin, and Carbon Dioxide Emissions: Quantile Mediation Analysis

Crude oil, Bitcoin, and carbon dioxide emissions are major issues that are significantly impacting the global economy and environment. These three issues are complexly interlinked, with profound economic and environmental implications. In this study, we explore the correlation among these three issues and attempt to understand the influence of crude oil and Bitcoin on carbon dioxide emissions. We created a novel approach, named quantile mediation analysis, which blends mediation regression with quantile regression, enabling us to explore the influence of Brent crude oil on carbon dioxide emissions by considering the mediating impact of Bitcoin. According to the findings from using our new approach, the impact of Brent crude oil on carbon dioxide emissions is partly mediated by Bitcoin, and the association between Brent crude oil and carbon dioxide emissions involves both direct and indirect effects. Since the carbon dioxide generated by the extraction of crude oil and Bitcoin has a great impact on the environment, accelerating the use of clean energy technologies to reduce our reliance on crude oil should be the direction that the cryptocurrency industry ought to pursue in the future.

State regulation of the system of blockchain technologies and cryptocurrency operations

Digital technologies are increasingly penetrating various spheres of society, including the economic one. Blockchain the technology has existed for less than 10 years, however, it has successfully established itself in the Russian and world markets. Today, many organizations prefer to invest in specific systems based on blockchain technology. In the Russian Federation, blockchain technologies are also developing rapidly, which means they require clear state and legal regulation. The object of the study is the processes of state regulation and procedures for the use of blockchain technologies in the public financial sector. The subject is managerial, legal, organizational and economic relations, manifested in the development of blockchain technologies in the financial sector of the state. The published article reveals the essence and content of the blockchain platform in the development of a modern payment system, in particular, it substantiates the need for the use of blockchain technology by financial market participants as an innovative tool to accelerate the development of the economy, and considers the interest for the state, since the amount of taxes levied on the crypto industry is a significant share in the specific volume of taxes collected. The risks of using blockchain technologies in the financial system of the state are analyzed. Special attention is paid to the state regulation of the cryptocurrency industry. The main provisions of the road map for cryptocurrencies are considered; the main provisions of the Concept of regulating the circulation of digital currencies; the main provisions of the bill of the Ministry of Finance of the Russian Federation on the regulation of cryptocurrencies. The tools of state regulation of digital currency and the sphere of cryptocurrency are given.

Emergent Issues in Cryptocurrency: Identifying Research Gaps and Future Directions

This paper highlights potential research areas that require further investigation, suggesting that there are still significant gaps in the understanding of the factors that drive consumer behavior and adoption in the cryptocurrency industry. The study emphasizes the need for future research to explore issues such as the role of social media, trust, and branding in the cryptocurrency market, and their implications for marketing and business strategies. By identifying these research gaps, the study aims to encourage further exploration of these issues and contribute to a better understanding of the challenges and opportunities presented by this rapidly evolving industry.

An In-Depth Study of Cryptocurrency Exchanges

This research paper provides an in-depth analysis of cryptocurrency exchanges by examining their types, regulatory environment, challenges, and user behavior. We conducted a comparative study of ten popular cryptocurrency exchanges and collected data on user behavior and preferences through surveys, interviews, and website analysis. Our findings reveal that crypto exchanges face numerous challenges such as security, liquidity, and regulatory compliance. We also found that users prefer exchanges that offer a wide range of cryptocurrencies, high liquidity, low fees, and strong security measures. This research contributes to the understanding of the cryptocurrency industry and provides insights for policymakers, investors, and users. Keywords : Cryptocurrency Exchanges, Bitcoin, Trading, Portability and Vulnerability

Cryptocurrency Price Prediction Based on ARIMA, Random Forest and LSTM Algorithm

Price prediction of cryptocurrencies is bound to get more opportunities for investors engaged in digital currency-related industries in order to earn more revenue. In the traditional forecasting methods, the problem of the high volatility of bitcoin price needs to be effectively solved, making the forecasting accuracy become low and ineffective. Due to the rapid development of artificial intelligence technology, more and more relevant algorithms were used for cryptocurrency price research. This study would compare and analyze the prediction effect of the ARIMA time-series model, the Random Forest algorithm of machine learning, and the LSTM algorithm of deep learning algorithm on cryptocurrencies price prediction to assist investors in making investment decisions. In this paper, five years of time-series data of Bitcoin, Ether, and Dogecoin is obtained from 2018 to 2022. Then, the training set and testing set are separated with 0.8:0.2 to test ARIMA, Random Forest, and LSTM algorithms. To evaluate the model, the mean square error (MSE), root mean square error (RMSE), mean absolute error (MAE), and decidability coefficient (R2) are chosen as metrics to measure the prediction of each prediction model precision. Comparing the experimental results, the prediction accuracy of LSTM is better than that of Random Forest, and the prediction accuracy of Random Forest is better than ARIMA model. These results shed light on guiding further exploration of significant to cryptocurrency industry practitioners and visitors.

The Impact of Celebrity Endorsements on the Cryptocurrency Industry Through a Multi-Level Latent Class Analysis and Software-Based Approach. (Multidisciplinary Study)

The Impact of Celebrity Endorsements on the Cryptocurrency Industry Through a Multi-Level Latent Class Analysis and Software-Based Approach. (Multidisciplinary Study)