The Negative Investor Attention Impact on Bitcoin

Abstract

This paper provides an analysis of the negative investor attention impact on bitcoin’s performance. By negative investor attention, we mean investor attention preceding a negative event, such as for example, a cyber-attack. Since their creation, the crypto-market has been numerous times the target of various attacks, which lead to important financial losses. Thus, we propose this study, in which we aim to capture the investor’s reaction and impact on the bitcoin’s performance as a consequence of these negative events happening. We are proxying the negative investor attention by using Google volume searches and splitting the search terms into ’specialist’ and ’non-specialist’ investors. The results obtained show that our Google searches and implicitly the negative investor attention impact bitcoin’s performance. Moreover, the non-specialist-considered keywords seem to drive returns more than the ones of a specialist. This result suggests that the majority of crypto-investors are, in fact, amateur or non-specialists.