Abstract

The cryptocurrency crash on the 5th of September, 2018, resulted in price decreases in 95 of the 100 leading digital currencies. We obtained millisecond data of some of the more prominent cryptocurrencies–bitcoin, ethereum, ripple, bitcoin cash and eos–and some of the smaller cryptocurrencies–neo, nem, omg, tezos and lisk–that were most affected in the crash and investigated what caused the digital market to collapse. We find that the behaviour of the more prominent cryptocurrencies and bitcoin, in particular, was the dominant factor behind the crash. We also find that smaller cryptocurrencies followed the behaviour of the larger ones in the crash. Furthermore, our empirical findings show that the trading behaviour of cryptocurrency traders (CTs) did not trigger the digital market crash. We propose the introduction of a single-cryptocurrency circuit breaker most prominent largest cryptocurrency–bitcoin–that will halt trading during market disruptions.

Details

Title
The great crypto crash in September 2018: why did the cryptocurrency market collapse?
Author
Manahov, Viktor 1   VIAFID ORCID Logo 

 University of York, School for Business and Society, York, UK (GRID:grid.5685.e) (ISNI:0000 0004 1936 9668) 
Pages
579-616
Publication year
2024
Publication date
Jan 2024
Publisher
Springer Nature B.V.
ISSN
02545330
e-ISSN
15729338
Source type
Scholarly Journal
Language of publication
English
ProQuest document ID
2932336850
Copyright
© The Author(s) 2023. This work is published under http://creativecommons.org/licenses/by/4.0/ (the “License”). Notwithstanding the ProQuest Terms and Conditions, you may use this content in accordance with the terms of the License.