TY - JOUR

T1 - Hype as a Factor on the Global Market: The Case of Bitcoin

AU - Nepp, Alexander

AU - Karpeko, Fedor

N1 - The reported study was funded by RFBR according to the research project no. 20-04-60158. We are also thankful to Prof. Olga Popova from the Institute for East and Southeast European Studies (IOS) (Germany, Regensburg), Azamat Valey, Nataly Davidson and Nadezhda Kislyak (Ural Federal University) for their help and interesting ideas. We appreciate the help of Svetlana Kovalenko, Viktoria Polyakova and Ekaterina Purgina from the Ural Federal University (Russia, Ekaterinburg). We are grateful to the two blind reviewers for their patience, time, useful comments and suggestions.

PY - 2024/1/2

Y1 - 2024/1/2

N2 - The impact of Bitcoin-related Google queries, Facebook likes, reposts and comments on Bitcoin price is analyzed with the help of ARDL and GARCH models. Our results have led us to the following conclusions. Firstly, a sharp increase in Bitcoin’s popularity or hype, which manifested itself through a rise in the number of Bitcoin-related Google queries, has resulted in an increase in Bitcoin price. This effect corresponds to the description of the ‘collective hysteria’ that spread in the online community and was triggered by the increasing volatility of the Bitcoin market. Secondly, we found that Bitcoin’s popularity among ordinary Internet users has a positive impact in low-volatile and highly volatile rising markets but a negative one in a highly volatile falling market. Thirdly, Bitcoin’s popularity among informed Internet users has a negative impact on Bitcoin price in a period of low volatility. Fourthly, uninformed users’ trust in Bitcoin has a positive influence on Bitcoin price in low-volatile and highly volatile falling markets. Finally, the main factors that shape the Bitcoin market are trust and popularity.

AB - The impact of Bitcoin-related Google queries, Facebook likes, reposts and comments on Bitcoin price is analyzed with the help of ARDL and GARCH models. Our results have led us to the following conclusions. Firstly, a sharp increase in Bitcoin’s popularity or hype, which manifested itself through a rise in the number of Bitcoin-related Google queries, has resulted in an increase in Bitcoin price. This effect corresponds to the description of the ‘collective hysteria’ that spread in the online community and was triggered by the increasing volatility of the Bitcoin market. Secondly, we found that Bitcoin’s popularity among ordinary Internet users has a positive impact in low-volatile and highly volatile rising markets but a negative one in a highly volatile falling market. Thirdly, Bitcoin’s popularity among informed Internet users has a negative impact on Bitcoin price in a period of low volatility. Fourthly, uninformed users’ trust in Bitcoin has a positive influence on Bitcoin price in low-volatile and highly volatile falling markets. Finally, the main factors that shape the Bitcoin market are trust and popularity.

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U2 - 10.1080/15427560.2022.2073593

DO - 10.1080/15427560.2022.2073593

M3 - Article

VL - 25

SP - 1

EP - 14

JO - Journal of Behavioral Finance

JF - Journal of Behavioral Finance

SN - 1542-7560

IS - 1

ER -