Is Google Affecting Bitcoin’s Price?
According to new research, the study has displayed evident that Google search trends may possibly be utilized by investors to possibly foresee an upcoming event. While no evidence or research points to a direct impact on the price and value or products and markets, is it possible that as more BTC related searches happen on Google’s engine, it’s price will see a direct effect?
A new study by Yukun Lin and Aleh Tsyvinksi, two economists from Yale University have found a link between Google search trends and cryptocurrency prices. According to the researchers, both of them believe that the discoveries point towards changes in the market could be a result of more or less interest by individuals and investors online. Basically put, the more people look up Bitcoin on Google’s search engine, the high its price becomes.
As per statements within the study, the paper says that increased amounts of attention by investors possibly foresees more profitable returns from a possible two-week horizon for BTC, one-week for Ripple and anywhere from one to six weeks for Ethereum. By utilizing the models, analysts have discovered a single deviation climb in search results on Google for Bitcoin contributed to over two percent in the coin’s price within a fortnight.
Additionally, trending posts on Twitter about Bitcoin resulted in the coin’s value climbing 2.5 percent in just one week. The same goes for a decrease in interest by investors as a decline in Google searches for Bitcoin have negatively affected the coin and other cryptocurrencies.
These findings suggest that as more individuals pay more attention online to BTC, it’s price will go up. However, this may not actually be how it works. Currently, a large possibility that the climb in searches on the engine is due to possible local theorizing that quickly picks up the pace and goes viral and eventually results in market prices increasing. One possible explanation as to how these factors contribute to the rise or decline of BTC value is that as prices drop, individuals shift their attention to other coins or products.
This could also be a result of news traveling about a cryptocurrency in other methods than Google searches which in return results in fewer searches.