Is Bitcoin business income or speculative bubble? Unconditional vs. conditional frequency domain analysis
Jamal Bouoiyour (),
Refk Selmi and
Aviral Tiwari
MPRA Paper from University Library of Munich, Germany
Abstract:
The present study addresses one of the most problematic phenomena: Bitcoin price. We explore the Granger causality for two relationships (Bitcoin price and transactions; Bitcoin price and investors’ attractiveness) from a frequency domain perspective using Breitung and Candelon’s (2006) approach. Intuitively, this research gauges empirically the causal links between these variables unconditionally on the one hand and conditionally to the Chinese stock market and the processing power of Bitcoin network on the other hand. The observed outcomes reveal some differences with respect to the frequencies involved, highlighting the complexity of assessing what Bitcoin looks like and the difficulty to gain clearer insights into this nascent crypto-currency. Beyond the nuances of short-, medium- and long-run frequencies, this paper confirms the extremely speculative nature of Bitcoin without neglecting its usefulness in economic reasons (trade transactions). The consideration of the Chinese market index and the hash rate has led to solid and unambiguous findings connecting further Bitcoin to speculation.
Keywords: Bitcoin price; transactions; investors’ attractiveness; unconditional frequency domain; conditional frequency domain. (search for similar items in EconPapers)
JEL-codes: C1 E4 E44 (search for similar items in EconPapers)
Date: 2014-09
New Economics Papers: this item is included in nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (23)
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https://mpra.ub.uni-muenchen.de/59595/1/MPRA_paper_59595.pdf original version (application/pdf)
Related works:
Working Paper: Is Bitcoin Business Income or Speculative Bubble? Unconditional vs. Conditional Frequency Domain Analysis (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:59595
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