Any port in a storm: Cryptocurrency safe-havens during the COVID-19 pandemic

Shaen Corbet, Yang (Greg) Hou, Yang Hu, Charles Larkin, Les Oxley

Research output: Contribution to journalArticlepeer-review

4 Citations (Scopus)

Abstract

Controlling for the polarity and subjectivity of social media data based on the development of the COVID-19 outbreak, we analyse the relationships between the largest cryptocurrencies and such time-varying realisation as to the scale of the economic shock centralised within the rapidly-escalating pandemic. We find evidence of significant growth in both returns and volumes traded, indicating that large cryptocurrencies acted as a store of value during this period of exceptional financial market stress. Further, cryptocurrency returns are found to be significantly influenced by negative sentiment relating to COVID-19. While not only providing diversification benefits for investors, results suggest that these digital assets acted as a safe-haven similar to that of precious metals during historiccrises.

Original languageEnglish
Article number109377
JournalEconomics Letters
Volume194
Early online date7 Jul 2020
DOIs
Publication statusPublished - 1 Sep 2020

Keywords

  • COVID-19
  • Cryptocurrency
  • Financial crisis
  • Pandemic
  • Safe-haven
  • Sentiment

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics

Fingerprint Dive into the research topics of 'Any port in a storm: Cryptocurrency safe-havens during the COVID-19 pandemic'. Together they form a unique fingerprint.

Cite this