Bitcoin during COVID-19:Could Internet Searches Explain Its Performance?

10 Pages Posted: 5 Apr 2022

See all articles by Petros Koutrakos

Petros Koutrakos

University of the Aegean

Dimitrios Stefanopoulos

Independent

Evangelos Vasileiou

University of the Aegean, Department of Financial and Management Engineering

Date Written: April 4, 2022

Abstract

The purpose of this note is to present a behavioral and computational analysis of the performance of Bitcoin (BTC) during the COVID-19 period 31.12.2019-31.03.2021. In order to quantitatively include a health fear index into our analysis, we employ a code which is based on the Google searches for terms related to COVID-19 (the higher the index, the more the fear due to the pandemic). Moreover, we examine if increased interest, as expressed with an increased number of internet searches for Bitcoin terms, has an impact on the performance of BTC. The empirical findings confirm our assumptions that the suggested fear index explains the negative impact of COVID-19 fear on the performance of BTC, and that the increased interest regarding BTC is associated with increases in BTC prices. The methodology and the outcome of our study could be useful to investors, practitioners and scholars whose intention is to examine the performance of financial markets/assets.

Keywords: Behavioral Finance; COVID-19; Health Risk; Risk Aversion; Google Trends

JEL Classification: D81, D83, G11, G12, G41, I12

Suggested Citation

Koutrakos, Petros and Stefanopoulos, Dimitrios and Vasileiou, Evangelos, Bitcoin during COVID-19:Could Internet Searches Explain Its Performance? (April 4, 2022). Available at SSRN: https://ssrn.com/abstract=4074818 or http://dx.doi.org/10.2139/ssrn.4074818

Petros Koutrakos

University of the Aegean

8 Michalon str.
Chios
Greece

Evangelos Vasileiou (Contact Author)

University of the Aegean, Department of Financial and Management Engineering ( email )

45, Kountourgiotou str.
Chios, GA 82100
Greece

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