Psychological barriers in the cryptocurrency market

Vítor Fonseca, Luis Pacheco and Júlio Lobão

Review of Behavioral Finance, 2019, vol. 12, issue 2, 151-169

Abstract: Purpose - The purpose of this paper is to study the existence of psychological barriers in cryptocurrencies. Design/methodology/approach - To detect psychological barriers, the authors perform a uniformity test, a barrier hump test, a barrier proximity test and conditional effects test to a sample comprised by the daily closing quotes of six of the most liquid cryptocurrencies. Findings - The results evidence the existence of psychological barriers in four of the cryptocurrencies under scrutiny, namely, Bitcoin, Dash, NEM and Ripple. Practical implications - The fact that the cryptocurrency market has a high share of unexperienced investors and presents several cases of psychological barriers is consistent with the hypothesis that that class of investors is particularly prone to the behavioral biases which cause psychological barriers. Originality/value - This paper studies, for the first time, the existence of psychological barriers in the market of cryptocurrencies.

Keywords: Market efficiency; Bitcoin; Psychological barriers; Cryptocurrencies; G14; G15; G41 (search for similar items in EconPapers)
Date: 2019
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (text/html)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (application/pdf)
Access to full text is restricted to subscribers

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:eme:rbfpps:rbf-03-2019-0041

DOI: 10.1108/RBF-03-2019-0041

Access Statistics for this article

Review of Behavioral Finance is currently edited by Professor Gulnur Muradoglu

More articles in Review of Behavioral Finance from Emerald Group Publishing Limited
Bibliographic data for series maintained by Emerald Support ().