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- Title
What can monetary policy tell us about Bitcoin?
- Authors
Pietrzak, Marcin
- Abstract
Bitcoin enthusiasts argue that it is free from central banks decisions and it is a hedge against inflation. Using high-frequency monetary surprises associated with decisions made by the Fed and the ECB, I show that these claims are not supported by the data. Bitcoin systemically reacts to monetary and central bank information shocks. I find that these reactions vary over time: not only by changing the magnitude but sometimes sign of reaction. Fed's disinflationary shocks increase Bitcoin price, while the ECB's decrease, hence providing little support for it as an inflation hedge.
- Subjects
EUROPEAN Central Bank; MONETARY policy; BITCOIN; CENTRAL banking industry; PRICE increases
- Publication
Annals of Finance, 2023, Vol 19, Issue 4, p545
- ISSN
1614-2446
- Publication type
Article
- DOI
10.1007/s10436-023-00432-3