The impact of the Bitcoin bubble of 2017 on Bitcoin's P2P market

Mark Holub and Jackie Johnson

Finance Research Letters, 2019, vol. 29, issue C, 357-362

Abstract: Peer-to-peer (P2P) exchange has an important role to play in global Bitcoin trading, yet most research into Bitcoin price behaviour focuses on exchange trading. An analysis of Bitcoin's P2P market indicates that when prices are measured relative to the going market rate, P2P traders in Bitcoin face different premiums and discounts depending on the currency traded, which in turn impacts on the bid-ask spread. In periods of extreme price changes such as the extraordinary price rise in Bitcoin occurring in 2017, measuring bid-ask spreads in relative terms masks the true picture of widening monetary bid-ask spreads.

Keywords: Bitcoin; Cryptocurrencies; Bid-ask spread; Peer-to-peer (P2P) exchange; Bubble (search for similar items in EconPapers)
JEL-codes: E42 G11 G15 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:29:y:2019:i:c:p:357-362

DOI: 10.1016/j.frl.2018.09.001

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