research-article
Authors: Wen Li, Lingfeng Bao, Jiachi Chen, John Grundy, Xin Xia, Xiaohu Yang
ACM Transactions on Internet Technology, Volume 24, Issue 2
Article No.: 8, Pages 1 - 26
Published: 18 March 2024 Publication History
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Abstract
The cryptocurrency market cap has experienced a great increase in recent years. However, large price fluctuations demonstrate the need for governance structures and identify whether there are market manipulations. In this article, we conduct three analyses—social media data analysis, blockchain data analysis, and price bubble analysis—to investigate whether market manipulation exists on Bitcoin, Ethereum, and Dogecoin platforms. Social media data analysis aims to find the reasons for price fluctuations. Blockchain data analysis is used to find detailed behavior of the manipulators. Price bubble analysis is used to investigate the relation between price fluctuation and manipulators’ behavior. By using the three analyses, we show that market manipulation exists on Bitcoin, Ethereum, and Dogecoin. However, market manipulation of Bitcoin is limited, and for most of Bitcoin’s price fluctuations, we found other explanations. The price for Ethereum is the most sensitive to technical updates. Technical companies/teams usually hype some new concepts (e.g., ICO, DeFi), which causes a price spike. The price of Dogecoin has a high correlation with Elon Musk’s X (formerly known as Twitter) activity, showing that influential individuals have the ability to manipulate its prices. In addition, the poor monetary liquidity of Dogecoin allows some users to manipulate its price.
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Index Terms
Market Manipulation of Cryptocurrencies: Evidence from Social Media and Transaction Data
Applied computing
Law, social and behavioral sciences
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Published In
ACM Transactions on Internet Technology Volume 24, Issue 2
May 2024
96 pages
EISSN:1557-6051
DOI:10.1145/3613553
- Editor:
- Ling Liu
Georgia Institute of Technology, USA
Issue’s Table of Contents
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Publication History
Published: 18 March 2024
Online AM: 30 January 2024
Accepted: 25 January 2024
Revised: 21 November 2023
Received: 30 January 2023
Published inTOITVolume 24, Issue 2
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Author Tags
- Blockchain
- cryptocurrencies
- market manipulation
- empirical study
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- National Key Research and Development Program of China
- National Science Foundation of China
- Fundamental Research Funds for the Central Universities
- ARC Laureate Fellowship
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