EconPapers    
Economics at your fingertips  
 

Equilibrium Bitcoin Pricing

Bruno Biais, Albert Menkveld, Catherine Casamatta, Christophe Bisière and Matthieu Bouvard
Additional contact information
Matthieu Bouvard: McGill University, Desautels Faculty

No 360, 2019 Meeting Papers from Society for Economic Dynamics

Abstract: We offer an overlapping generations equilibrium model of cryptocurrency pricing and confront it to new data on bitcoin transactional benefits and costs. The model emphasizes that the fundamental value of the cryptocurrency is the stream of net transactional benefits it will provide, which depend on its future prices. The link between future and present prices implies that returns can exhibit large volatility unrelated to fundamentals. We construct an index measuring the ease with which bitcoins can be used to purchase goods and services, and we also measure costs incurred by bitcoin owners. Consistent with the model, estimated transactional net benefits explain a statistically significant fraction of bitcoin returns.

Date: 2019
New Economics Papers: this item is included in nep-dge and nep-pay
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

Downloads: (external link)
https://red-files-public.s3.amazonaws.com/meetpapers/2019/paper_360.pdf (application/pdf)

Related works:
Journal Article: Equilibrium Bitcoin Pricing (2023) Downloads
Working Paper: Equilibrium bitcoin pricing (2023) Downloads
Working Paper: Equilibrium Bitcoin Pricing (2020) Downloads
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:red:sed019:360

Access Statistics for this paper

More papers in 2019 Meeting Papers from Society for Economic Dynamics Society for Economic Dynamics Marina Azzimonti Department of Economics Stonybrook University 10 Nicolls Road Stonybrook NY 11790 USA. Contact information at EDIRC.
Bibliographic data for series maintained by Christian Zimmermann ().

 
Page updated 2025-03-19
Handle: RePEc:red:sed019:360