Quantifying the sustainability of Bitcoin and Blockchain

Fry, John; Serbera, Jean-Philippe

Abstract

Purpose
The authors develop new quantitative methods to estimate the level of speculation and long-term sustainability of Bitcoin and Blockchain.

Design/methodology/approach
The authors explore the practical application of speculative bubble models to cryptocurrencies. They then show how the approach can be extended to provide estimated brand values using data from Google Trends.

Findings
The authors confirm previous findings of speculative bubbles in cryptocurrency markets. Relatedly, Google searches for cryptocurrencies seem to be primarily driven by recent price rises. Overall results are sufficient to question the long-term sustainability of Bitcoin with the suggestion that Ethereum, Bitcoin Cash and Ripple may all enjoy technical advantages relative to Bitcoin. Our results also demonstrate that Blockchain has a distinct value and identity beyond cryptocurrencies – providing foundational support for the second generation of academic work on Blockchain. However, a relatively low estimated long-term growth rate suggests that the benefits of Blockchain may take a long time to be fully realised.

Originality/value
The authors contribute to an emerging academic literature on Blockchain and to a more established literature exploring the use of Google data within business analytics. Their original contribution is to quantify the business value of Blockchain and related technologies using Google Trends

Citation

Fry, J., & Serbera, J. (2020). Quantifying the sustainability of Bitcoin and Blockchain. Journal of Enterprise Information Management, 33(6), 1379-1394. https://doi.org/10.1108/JEIM-06-2018-0134

• Journal Article Type: Article
• Acceptance Date: Feb 10, 2019
• Online Publication Date: Mar 18, 2020
• Publication Date: Dec 7, 2020
• Deposit Date: Feb 4, 2022
• Journal: Journal of Enterprise Information Management
• Print ISSN: 1741-0398
• Publisher: Emerald
• Peer Reviewed: Peer Reviewed
• Volume: 33
• Issue: 6
• Pages: 1379-1394
• DOI: https://doi.org/10.1108/JEIM-06-2018-0134
• Keywords: Behavioural modelling; Blockchain; Google trends; Long-term investment; Speculative bubbles
• Public URL: https://hull-repository.worktribe.com/output/3921079
• Related Public URLs: https://bradscholars.brad.ac.uk/handle/10454/17644