Number Of Cryptocurrencies Research Articles

Native Market Factors for Pricing Cryptocurrencies

The cryptocurrency market has been growing frantically in number of cryptocurrencies, online exchanges, and market capitalization, which has amplified the need for comprehensive and robust pricing models. Using a database of all eligible cryptocurrencies listed on the CoinMarketCap website, we study the relationship between returns and several potential pricing factors, such as size (market capitalization), momentum, liquidity, and maturity. The analysis was conducted from December 27, 2013, to December 29, 2020, using weekly data for 3'667 cryptocurrencies. Results point out that portfolios of cryptocurrencies with smaller market capitalization, higher reversal, lower liquidity, and lower maturity tend to offer higher returns. The 5-factor model that additionally includes illiquidity and maturity performs better than the 3-factor model previously proposed in the literature, meaning that illiquidity and maturity significantly help capture the cross-sectional cryptocurrency risk premia. The 5-factor model presented seems robust to different procedures to construct portfolios and factors.

Money Functions in Modern Economy

In advanced economies there is a tendency to move to digitization and cashless financial economic activities. In this sense, the number of cryptocurrencies that contributed more to this trend increased. In this article the authors aim to highlight the functions of money in the modern economy taking into account these trends and developments. In this sense, Bitcoin and other digital currencies can cause a change in the functions of money. In the article we sought to demonstrate the extent to which digital currencies can be considered money, using a complex methodology, logical and interpretive analyses, starting from the comparative study of the situation of coins and the existing situation in the monetary mass of the money that exists in circulation.

The Essence and Place of Cryptocurrency in the Financial System

Abstract. Introduction. The history of the emergence of Bitcoin and other cryptocurrencies is analyzed. Basic concepts related to blockchain technology are explained. The main focus is on issues important from an investor's point of view, as well as on technical aspects, including the essence and importance of blockchain technology. Purpose. The purpose of the article is to generalize and systematize the available information about the emergence of cryptocurrencies and analyze their patterns. Results. The specifics of digital assets and the bitcoin exchange rate in 2012-2021 were studied in more detail. It was found that on the cryptocurrency market you can earn (as well as lose) both as a trader and as a so-called cryptocurrency hodlers. A rating of cryptocurrency exchanges was developed according to the following indicators: security, number of crypto currencies, fiat currencies, advantages of the exchange, disadvantages of the exchange. Cryptocurrency exchanges are a central part of the entire digital collection ecosystem today. Currently, there are already several hundred crypto exchanges on the market, which differ in terms of transactions, security levels or listed values. In this article, we have described cryptocurrency as objectively as possible so that you can assess for yourself whether it will be the right form of investment for you. Conclusions. The wide choice of service providers and the fact that digital currencies are a relatively new form of investment means that finding the best place to trade is not easy. The cooperation of international financial conglomerates in the development of blockchain technology will save these enterprises billions of dollars per year and will be able to improve their operations and eliminate errors related to the human factor. Participants in the financial system are forced to propose standards that would apply to each participant in the network without disturbing the established status quo in international markets.

HYBRID MODEL FOR CRYPTOCURRENCY INVESTMENT STRATEGIES

Cryptocurrencies are digital assets based on the blockchain, they use cryptography to guarantee their ownership and ensure the integrity of transactions, in addition to allowing control over the creation of additional units. Since its creation in 2009, with Bitcoin as the first cryptocurrency, the market and the number of cryptocurrencies have grown rapidly, as has the interest of those seeking high returns due to its rapid appreciation, whether these investors are individuals or financial institutions. However, this market has characteristics of high volatility and uncertainty, causing prices to vary at very high levels and also at low levels, all of which makes investment decisions in cryptocurrencies very difficult for investment managers. This article proposes a decision-making support methodology for managing investments in the cryptocurrency market, which considers a conservative investment risk profile and seeks to reduce risk and maximize investment return. The methodology aims to establish return levels and estimate the transition probabilities of returns for each level, this is done based on the historical price of cryptocurrencies and using the analysis of Markov chains, which are integrated into the multiple decision trees to identify the cryptocurrency that projects the highest return when it is sold, in one or two periods after acquisition. The results are compared with real data, and the efficiency of the methodology is verified.

Effects of Cryptocurrencies on Global Economics: A Review Study

The features of a new global economy appear stronger and faster than the changes recorded by the economy throughout history, and the “Covid-19” pandemic has accelerated these transformations, achieving on the ground a global experience to deal with digital payment via credit cards and the use of online payment applications, and it marks the beginning of the end of the era of paper currencies. And the trend towards investing in crypto and digital currencies on the part of investors, in conjunction with the competition of countries around the world to win the issuance of the first digital currency issued by central banks. There are many questions about replacing the digital currency with gold or the dollar in a rapid transformation that changes the trends of the global economy, and the number of cryptocurrencies around the world has reached about 4337 currencies with a market value of $ 1.003 trillion, “Bitcoin” holds the largest share by 66% with a market value of $ 664 billion. Despite many official warnings against investing in these unregulated currencies, fintech startups are witnessing a surge in demand from consumers who are rushing to invest in cryptocurrencies amid great interest and momentum in Bitcoin. Like Revolut, eToro and Luno, cryptocurrency demand surged on their platforms amid the resurgence of Bitcoin prices.

Effects of Cryptocurrencies on Global Economics: A Review Study

The features of a new global economy appear stronger and faster than the changes recorded by the economy throughout history, and the “Covid-19” pandemic has accelerated these transformations, achieving on the ground a global experience to deal with digital payment via credit cards and the use of online payment applications, and it marks the beginning of the end of the era of paper currencies. And the trend towards investing in crypto and digital currencies on the part of investors, in conjunction with the competition of countries around the world to win the issuance of the first digital currency issued by central banks. There are many questions about replacing the digital currency with gold or the dollar in a rapid transformation that changes the trends of the global economy, and the number of cryptocurrencies around the world has reached about 4337 currencies with a market value of $ 1.003 trillion, “Bitcoin” holds the largest share by 66% with a market value of $ 664 billion. Despite many official warnings against investing in these unregulated currencies, fintech startups are witnessing a surge in demand from consumers who are rushing to invest in cryptocurrencies amid great interest and momentum in Bitcoin. Like Revolut, eToro and Luno, cryptocurrency demand surged on their platforms amid the resurgence of Bitcoin prices.

Effects of Cryptocurrencies on Global Economics: A Review Study

The features of a new global economy appear stronger and faster than the changes recorded by the economy throughout history, and the “Covid-19” pandemic has accelerated these transformations, achieving on the ground a global experience to deal with digital payment via credit cards and the use of online payment applications, and it marks the beginning of the end of the era of paper currencies. And the trend towards investing in crypto and digital currencies on the part of investors, in conjunction with the competition of countries around the world to win the issuance of the first digital currency issued by central banks. There are many questions about replacing the digital currency with gold or the dollar in a rapid transformation that changes the trends of the global economy, and the number of cryptocurrencies around the world has reached about 4337 currencies with a market value of $ 1.003 trillion, “Bitcoin” holds the largest share by 66% with a market value of $ 664 billion. Despite many official warnings against investing in these unregulated currencies, fintech startups are witnessing a surge in demand from consumers who are rushing to invest in cryptocurrencies amid great interest and momentum in Bitcoin. Like Revolut, eToro and Luno, cryptocurrency demand surged on their platforms amid the resurgence of Bitcoin prices.

Analisis Performa Mata Uang Virtual (Cryptocurrency) Menggunakan Preference Ranking Organization Method For Enrichment Evaluation (Promethee)

Cryptocurrencies are among the inventions that have caused a stir in the economy of late. Because in its use there are still pros and cons of various countries. Some countries reject the use of cryptocurrencies and others support the use of cryptocurrencies because it is considered a modernization of payment tools. Besides being used for payment instruments, cryptocurrencies can also be one of the options to invest. The number of cryptocurrencies that exist causes investors to be observant in making the right choices. In this study, the Promethee method was used I and II to determine the rank of 7 virtual currencies. Promethee I is a partial assessment method while Promethee II is a complete assessment method. The data used for ranking is obtained from the questionnaire sentiment on the performance of cryptocurrencies. The results of the cryptocurrency performance analysis showed that the investment commodity of the most recommended in a row is Bitcoin with a net flow value of 0.33267, Cardano 0.14267, Ethereum 0.04800, Ripple 0.04733, Stellar -0.04733, Litecoin -0.04767 and Dogecoin -0.47567.

Are the top six cryptocurrencies efficient? Evidence from time‐varying long memory

AbstractWhile gaining more popularity both as a financial asset and a commodity, a number of cryptocurrencies are emerging with a loosely regulated market microstructure which is a challenge to their efficiency. We have ranked 6 out of the top 10 cryptocurrencies based on their inefficiency ratios, using a novel time‐varying generalised Hurst exponent methodology. All the six crypto markets exhibit a time‐varying efficiency throughout the studied period, thus indicating a varying degree of exploitable profitable trading opportunities. The inefficiency ratio indicates that Bitcoin is the third most inefficient market, while the first and second most inefficient markets are DASH and NEM, respectively, thus they provide the most abnormal profit opportunities. However, the most efficient crypto markets are Ethereum and Ripple according to the order of their rankings. Further research could be performed on the factors affecting the inefficiency index to understand the efficiency determination of these cryptocurrency markets.

Are Cryptocurrencies Priced in the Cross-section? A Portfolio Approach

Most papers, that study determinants of cryptocurrency prices, find no significant relation with existing market factors. We examine a portfolio approach to explore cross-sectional pricing within the crypto-market. At its inception, Bitcoin meant to be an alternative to fiat currencies. Yet high returns in this market may have also attracted usual investors as well, as they are looking for more investments and diversification venue. Since Bitcoin, the number of cryptocurrencies has reached more than 6,000 as of the beginning of 2020, according to coingecko.com. Hence, investors have more choices when they decide to enter into the crypto-market. So, they have an incentive to understand the crypto-market interaction with their current investments. We examine ten factors from equity, currency, and commodity markets and find that size and commodity index have a negative and highly significant correlation in the cross-section. These results support the market participants’ view that cryptocurrencies are still too volatile to serve as a store of value. In the sense that, cryptocurrencies with a negative sensitivity to physical commodities are appreciated by investors.

Economic, legal and financial perspectives on cryptocurrencies: a review on cryptocurrency growth, opportunities and future prospects

Cryptocurrency has become most sought after digital payment system these days and has been regarded as the safest mode of transferring money and making payments. The functionality of the cryptocurrency highly depends upon the use of advanced technology and resulted in the emergence of a number of cryptocurrencies like Bitcoin, Ripple, Ethereum, etc. The evolution and growth of cryptocurrency have been tremendous during the last 10 years and has revolutionised the whole financial sector. The cryptocurrency provides immense opportunities to the users in the form of increased job propensities and new market ventures along with certain challenges like volatility, lack of markets and so on. The risk and return factors involved with the usability and adaptability of cryptocurrency has also impacted the users in both positive and negative ways. Hence, the current research study provides detailed insights about cryptocurrency, its growth, opportunities, and future prospects in an adequate manner.

A theory of optimum cryptocurrency scope

ABSTRACT Robert Mundell (1961. “A Theory of Optimum Currency Areas.” The American Economic Review 51 (4): 657–665) framed the fixed-versus-flexible exchange rate controversy in a novel way when he focused attention on currency areas and the ingredients necessary for a group of nations to form an optimal currency area (OCA). This paper proposes an analogous theory for cryptocurrencies, called optimal currency scope (OCS), and explains the conditions necessary for an OCS to exist. In contrast to an OCA, which is defined by its non-overlapping geographic areas, an OCS is defined by its multiple-overlapping attributes and the needs they solve, which we call scope. Scopes are not geographic and have fuzzy boundaries; so, the possibility of competing currencies in a single scope needs to be considered. The central issues surrounding an OCS are the optimal number and magnitude of currency attributes, rather than whether nations should adopt fixed versus fluctuating exchange rates. Similar to the findings since Mundell first introduced his OCA Theory, we find that the optimum number of cryptocurrency attributes and, therefore, the optimal number of cryptocurrencies must be determined empirically rather than theoretically.

Momentum and contrarian effects on the cryptocurrency market

We report the results of investigation of the momentum and contrarian effects on cryptocurrency markets. The investigated investment strategies involve 100 (amongst over 1200 present as of date Nov 2017) cryptocurrencies with the largest market cap and average 14-day daily volume exceeding a given threshold value. Investment portfolios are constructed using different assumptions regarding the portfolio reallocation period, width of the ranking window, the number of cryptocurrencies in the portfolio, and the percent transaction costs. The performance is benchmarked against: (1) equally weighted and (2) market-cap weighted investments in all of the ranked assets, as well as against the buy and hold strategies based on (3) S&P500 index, and (4) Bitcoin price. Our results show a clear and significant dominance of the short-term contrarian effect over both momentum effect and the benchmark portfolios. The information ratio coefficient for the contrarian strategies often exceeds two-digit values depending on the assumed reallocation period and the width of the ranking window. Additionally, we observe a significant diversification potential for all cryptocurrency portfolios with relation to the S&P500 index.

Tales from the crypt: might cryptocurrencies spell the death of traditional money? - A quantitative analysis -

Abstract Cryptocurrencies have experienced an exponential growth trend in the past 24 months, followed by a big crash. In the early years of the Internet, inspired entrepreneurs such as Jeffrey Bezos realized that, when something grows exponentially, it becomes ubiquitous within a short time span. Similarly to the Internet in 1994, cryptocurrencies have recently been growing at a dazzling rate, thus one can expect them to be used on a global scale very soon, in spite of the last bubble which has already burst. Alternative currencies are greeted with great enthusiasm, due to their potential to return financial power back to the people, especially in the context of general dissatisfaction and disappointment with the banking sector. They bring about several advantages, such as financial innovations, lower fees as well as increased availability to developing populations. At the same time, their high volatility and lack of supervision might imply that they only serve as complementary financing and not as a substitute of traditional banking. This article discusses the development of cryptocurrencies, including aspects related to Bitcoin, financial technology and the blockchain. Using historical data from Coinmarketcap.com between April 2013 and February 2018, I run a quantitative analysis of the distributions and evolution over time for all listed cryptocurrencies with known market capitalization. I look at the interplay between number of cryptocurrencies and market value, at growth rates, cumulative shares and volatility. I find a phenomenon of exponential growth and violent volatility, which I explain in light of cryptocurrencies’ strengths and weaknesses, as identified in the literature. I emphasize the importance of cryptocurrencies in the context of the global digital economy and I discuss future implications.

Crypto-currencies hit by hacking attacks, theft and fraud

A number of crypto-currencies, and the exchanges that trade in them, have been hit by attacks and fraudulent activity. At the same time, cyber-criminals appear to be shifting their focus from activities such as ransomware to crypto-currency mining.

Volatility, market capitalization and seasonality of Bitcoin prices

Financial markets have witnessed a tremendous growth of crypto currencies in the recent years. These crypto currencies are digital currencies and use encryption techniques to regulate the generation of units of currency and verify them. A number of crypto currencies are being traded in the markets which include Bitcoin. Bitcoin is the first and the most popular crypto currency traded in the markets. The price of Bitcoins has seen ups and downs in the last 8 years since its launch. The aim of this study is to study the volatility, market capitalization and seasonality of Bitcoins. The study uses only secondary data for a period of 6 years, for Volatility of Bitcoin prices, market capitalization and movement of Bitcoin prices, but 7 years for studying the seasonality of Bitcoin prices. Regression analysis, histograms are used to analyze and present the data. The findings of the study indicate the prices of Bitcoins have declined in the recent periods and have a tendency to decline during a certain period of the year.

Cryptocurrencies: Economic Benefits and Risks

Since the emergence of Bitcoin in 2009, the number of cryptocurrencies, their applications and market value grew significantly. There is a surge in the number of businesses, financial institutions and authorities, investors and governments interested in the adaptation of the cryptocurrencies and/or blockchain technology. In this report, we aim to provide an overview of the economic benefits and risks of cryptocurrencies for researchers and students in economics, finance, mathematics and computer science. The report offers the summary of the academic and non-academic literature concerning this topic published to this day as well as the list of future research perspectives, review of Bank of England research on cryptocurrencies, and contributions from University of Manchester researchers specialising in various academic fields. Among the economic benefits, we discuss the defining characteristics of cryptocurrency users and the potential benefits for small and large businesses and the society as a whole. We also focus on the new, low-cost and unregulated form of early-stage company financing which was propagated by some of the blockchain start-ups, the Initial Coin Offerings (ICOs). Subsequently, we acknowledge the risks posed by the adaptation of cryptocurrencies, analyse their efficiency and stability issues. We also address the problem of illegal activities benefiting from the anonymity offered by the system, focusing predominantly on tax evasion, money laundering, the economy of dark markets and terrorism financing. The report also covers the responses of governments and central banks to this phenomenon and the current state of legal definitions of cryptocurrencies in chosen countries.