Correlation analysis and prediction between bitcoin price and its influencing factors

Abstract

As the oldest and most famous cryptocurrency, the price of Bitcoin has increased nearly 2 million times in the last decade. As a result, predicting the price of Bitcoin through machine learning has become a big hit in recent years. This paper analyzes the correlation between the price of Bitcoin and market or social factors that may affect the price of Bitcoin. Then the author uses these factors with higher correlation to predict the price of bitcoin by LSTM. The experiments show that the average absolute percentage error of the LSTM prediction of bitcoin price decreases from 11.52% to 10.16%, 9.79%, 9.73%, 9.59%, 8.82%, and 8.50%, respectively, after the introduction of external correlation factors.