The rapid growth of cryptocurrencies: How profitable is trading in digital money?

【Author】 Manahov, Viktor

【Source】INTERNATIONAL JOURNAL OF FINANCE & ECONOMICS

【影响因子】1.634

【Abstract】There has been a tremendous growth in cryptocurrencies, which has challenged policy makers around the globe. We obtain millisecond data of some of the most frequently traded cryptocurrencies - bitcoin, ethereum, ripple, litecoin and dash - and two cryptocurrency indices - CRIX and CCI30 - to examine their profitability. Our profitability findings suggest that cryptocurrency traders generate significant profits after considering reasonable transaction costs. We also observe that cryptocurrency market participants can expand and sustain the levels of profitability levels in the subsequent trading activity. Our robustness checks with more recent post-Covid data are consistent with the initial profitability findings, although we observe lower levels of profits for the two indices and weaker profit persistency for all digital assets.

【Keywords】cryptocurrency markets; cryptocurrency profitability; market efficiency

【发表时间】

【收录时间】2023-02-28

【文献类型】实验仿真

【主题类别】

区块链治理-市场治理-数字货币