Articles

The world of the stock market is an intricately complex financial ecosystem that demands years of dedicated study to comprehend fully. It relies on risk mitigation practices and fundamental theoretical techniques to engage in speculation regarding stock and cryptocurrency fluctuations. However, this realm is progressively becoming more inclusive, with accessibility expanding beyond traditional educational barriers. Technological advancements, coupled with the ease of entry into this domain and the information-disseminating power of social networks, contribute to a rising number of individuals participating in this financial movement. What makes this evolution disruptive is that the same tools facilitating accessibility also exert influence on the way market trends unfold. This paper delves into the escalating impact of social media within the financial sphere, emphasizing the heightened accessibility to information and market involvement facilitated by platforms like Twitter and Reddit. It sheds light on how social media plays a pivotal role in market manipulation, as evidenced by phenomena such as the r/wallstreetbets subreddit, where meme-based strategies were employed to inflate the prices of stocks like GameStop. The study explores the utilization of social media by influential figures, exemplified by Elon Musk, who leverage their platforms to sway market movements. Additionally, this paper addresses instances of misinformation, such as the confusion surrounding Virgin Galactic's shares following a SpaceX failure and the introduction of "AGUA" in the Mexican stock market, leading to widespread misunderstandings. The paper extends its examination to the effects of social media on cryptocurrencies, highlighting how comments from public figures can significantly impact the prices of Bitcoin and Dogecoin. Overall, it underscores the imperative need for adaptation to these changes in the digital financial paradigm.

The future of e-money is crypocurrencies, it is the decentralize digital and virtual currency that is secured by cryptography. It has become increasingly popular in recent years attracting the attention of the individual, investor, media, academia and governments worldwide. This study aims to model and forecast the volatilities and returns of three top cryptocurrencies, namely; Bitcoin, Ethereum and Binance Coin. The data utilized in the study was extracted from the higher market capitalization at 31^st December, 2021 and the data for the period starting from 9^th November, 2017 to 31^st December 2021. The Generalised Autoregressive conditional heteroscedasticity (GARCH) type models with several distributions were fitted to the three cryptocurrencies dataset with their performances assessed using some model criterion tests. The result shows that the mean of all the returns are positive indicating the fact that the price of this three crptocurrencies increase throughout the period of study. The ARCH-LM test shows that there is no ARCH effect in volatility of Bitcoin and Ethereum but present in Binance Coin. The GARCH model was fitted on Binance Coin, the AIC and log L shows that the CGARCH is the best model for Binance Coin. Automatic forecasting was perform based on the selected ARIMA (2,0,1), ARIMA (0,1,2) and the random walk model which has the lowest AIC for ETH-USD, BNB-USD and BTC-USD respectively. This finding could aid investors in determining a cryptocurrency's unique risk-reward characteristics. The study contributes to a better deployment of investor’s resources and prediction of the future prices the three cryptocurrencies.

With the rise of virtual currencies, Bitcoin has gradually become one of the safe-haven tools in the financial market. During situations of worldwide outbreaks of an infectious disease, investors pay special attention to asset allocation. Therefore, this study discusses the outbreak of COVID-19 in China, which has affected financial markets and has led investors to avoid risks through investing in traditional financial products or Bitcoin. We found that during the time of the COVID-19 pneumonia, Bitcoin and gold futures were used for hedging transactions in the face of unstable Chinese market conditions and under the pursuit of investors' maximization of return on investment. Furthermore, there was also no difference between hedging through Bitcoin or gold futures; however, investors had a preference to invest in gold futures for hedging under the assumption that an investor was absolutely risk averse.