The influence of Tweets on the price of cryptocurrencies

 

Principal investigator:

Prof. Dr. Daniel Fürstenau (FUB, ECDF)

Project participants:

Matthias Schulte-Althoff (FUB), Thuy Duong Le (FUB), Kai Schewina (FUB), Prof. Christian Meske (FUB, ECDF), Prof. Peter Mohr (FUB)

Project start:

2018/11

Project description:

High return opportunities are increasingly bringing cryptocurrencies into the focus of public attention. Above all Bitcoin and the Blockchain are widely studied. When considering determinants for the price formation of cryptocurrencies, emotional factors have often been neglected. Therefore, the project investigates the relationship between emotions and the price of cryptocurrencies such as Bitcoin and others. The main goal is to check the discovered relationships for theoretical conformity. Therefore, sentiment data is derived from Twitter messages with a reference to different cryptocurrencies. The data analysis is carried out with the help of statistical methods such as vector autoregressive models. In addition, the Granger causality test should allow a broader perspective on the relationship between the different factors In addition, we evaluate the results for robustness and prognostic power. The work has an interdisciplinary character and takes place in the context of the Einstein Center Digital Future.