Revisiting Bitcoin Price Behavior Under Global Economic Uncertainty

Khalid Khan, Jiluo Sun, Sinem Derindere Koseoglu and Ashfaq U. Rehman

SAGE Open, 2021, vol. 11, issue 3, 21582440211040411

Abstract: This study examines the relationship between global economic policy uncertainty (GEPU) and bitcoin prices (BCP) employing the rolling window method. The full sample test shows that there is no causality between GEPU and BCP. However, the full sample causal relationship between the variables can be different when considering structural changes. The finding of the rolling window test indicates that there is causality in different subsamples. It has found both positive and negative bidirectional causalities between GEPU and BCP across various subsamples. The decision makers need to accelerate the development of blockchain technology that can be used for hedging and portfolio diversification. Moreover, enacting laws and regulations on state interventions and prohibitions ensures investor confidence. Information about policy changes should be incorporated into portfolio selection to avoid random market fluctuations. Its unregulated nature makes it more turbulent in the short term and has undergone sudden changes, so investors should be able to obtain comprehensive information about global economic and policy changes. Policy makers should ensure investor confidence by making legal regulations on state interventions and prohibitions.

Keywords: bitcoin; global economic uncertainty; Granger causality; bootstrap rolling window; digital currency (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
https://journals.sagepub.com/doi/10.1177/21582440211040411 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:sae:sagope:v:11:y:2021:i:3:p:21582440211040411

DOI: 10.1177/21582440211040411

Access Statistics for this article

More articles in SAGE Open
Bibliographic data for series maintained by SAGE Publications ().