Analysing the interrelationship between Bitcoin price and it’s energy consumption

Neha Seth and Kirti Jain
Additional contact information
Neha Seth: Symbiosis International (Deemed University), Pune, India
Kirti Jain: Symbiosis International (Deemed University), Pune, India

Theoretical and Applied Economics, 2023, vol. XXX, issue 3(636), Autumn, 77-92

Abstract: An increasing trend in cryptocurrency prices shows the investors’ attention towards digital currency, but the carbon emission effect due to cryptocurrency is also gaining importance. However, no study has investigated the relationship between these two variables. The study’s objective is to investigate the relationship between Bitcoin energy consumption and the prices of Bitcoin. This paper uses Johansen’s cointegration test, the Vector error correction model, Granger’s causality, Impulsive response, and variance decomposition on daily frequency data. It indicates the existence of long-run cointegration between energy consumption and Bitcoin prices. On the other hand, VEC Granger causality indicates that one time series does not cause the other one and vice versa. Variance decomposition and impulsive response function also indicate that shocks in energy consumption insignificantly affect the Bitcoin prices and vice versa. Policymakers and regulators should pay attention to renewable energy resources in cryptocurrency mining.

Keywords: cryptocurrency; Bitcoin; energy consumption; vector error correction model; integration. (search for similar items in EconPapers)
Date: 2023
References: View complete reference list from CitEc
Citations:

Downloads: (external link)
http://store.ectap.ro/articole/1678.pdf (application/pdf)
http://www.ectap.ro/articol.php?id=1678&rid=152 (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:agr:journl:v:3(636):y:2023:i:3(636):p:77-92

Access Statistics for this article

Theoretical and Applied Economics is currently edited by Mircea Dinu

More articles in Theoretical and Applied Economics from Asociatia Generala a Economistilor din Romania / Editura Economica Contact information at EDIRC.
Bibliographic data for series maintained by Mircea Dinu ().