کد خبر: 317718تاریخ: 1400/8/16 17:22
Cryptocurrencies and capital market
Cryptocurrencies and capital market
By Ebrahim Rassam*

Cryptocurrencies are a new phenomenon that has spread globally and received attention from the media, venture capitalists, financial institutions and government bodies.

The emergence of cryptocurrencies as a new group of financial assets has provided a new opportunity to examine several undiscovered aspects of this phenomenon.

In recent years, the increasing role of the cryptocurrency market has attracted much attention among academic researchers, the media, government institutions, and the financial industry.

The sudden rise and the rapid development of cryptocurrency markets attributed to the sharp increase in their recent trading volume which have led to the creation of a comprehensive literature on cryptocurrencies.

Numerous studies have been conducted on cryptocurrencies focusing on market efficiency, price fluctuations, price clustering, speculation, and transaction costs.

As a result, the introduction of different types of cryptocurrencies in recent years has led to a swift increase in market size of cryptocurrency.

Cryptocurrency markets have an important role in investment financing decisions.

The observed relationship between cryptocurrency markets and other stock market indices shows patterns of returns and fluctuations between these markets which aid investment decisions.

The low level of bilateral relations between the cryptocurrency market and the stock indices have influence on the choice of asset category and investment due to price independence.

From a stock portfolio perspective, since price movements in the traditional asset category do not have a direct impact on the cryptocurrency market, investors or market partners can take capital and invest partially in cryptocurrencies because of the inevitable benefits of cryptocurrencies and accessibility.

They may lead to more liquidity in cryptocurrency markets around the world rather than putting assets in available ranges.

In the coming years, liquidity in the cryptocurrency market will be higher than in traditional asset classes because investors and market partners may be forced to keep a cryptocurrency instead of holding a stock in a listed trading company.

The traditional asset category has a high level of risk and indicates that even these markets may have higher returns for investors due to their volatile nature and investors may achieve lower returns with the intended risk.

Considering cryptocurrencies, they can be interpreted as independent financial instruments that impose unsystematic to unsystematic risk, which may be developed because of their attractiveness to investors.

Given the connectivity in cryptocurrency markets, our findings of cryptocurrency accumulation provide insights for regulators and potential international investors.

In the dispute between cryptocurrencies and the lack of linkage between cryptocurrencies and the classification of traditional economic financial assets, the various benefits associated with investing in cryptocurrencies dictate a call for policymakers and regulators to set criteria by which relationships, it deepens the broad structure of the cryptocurrency market and, with the rest of the traditional asset classification, to ensure the interests of investors with varying yields, accompanied by a dispersion between cryptocurrencies and stock market indices.

*Ebrahim Rassam is a university instructor.




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