Bitcoin, speculative sentiments and crypto-assets valuation

Daniel Tut

MPRA Paper from University Library of Munich, Germany

Abstract: What factors drive the valuation of Bitcoin and other crypto-assets? We use a novel measure and show that [1] Sentiments in Bitcoin drive the price action and have a material effect on returns [2] Sentiments in Bitcoin drive the valuation of other cryptocurrency assets [3] Sentiments in Bitcoin drive returns in other cryptocurrency assets. Our results show that optimistic sentiments in Bitcoin drive overvaluation in Bitcoin itself and other cryptocurrency assets. Our results support the notion that liquidity measures are salient factors in price discovery.

Keywords: Valuation; Cryptocurrencies; Bitcoin; Digital Assets; sentiments; speculation (search for similar items in EconPapers)
JEL-codes: D8 D84 G21 G24 G3 G32 G39 (search for similar items in EconPapers)
Date: 2024-03-18
New Economics Papers: this item is included in nep-fmk, nep-inv, nep-mon and nep-pay
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:120866

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