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Is Bitcoin’s Market Predictable? Analysis of Web Search and Social Media

  • Conference paper
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Knowledge Discovery, Knowledge Engineering and Knowledge Management (IC3K 2015)

Part of the book series: Communications in Computer and Information Science ((CCIS,volume 631))

Abstract

In recent years, Internet has completely changed the way real life works. In particular, it has been possible to witness the online emergence of web 2.0 services that have been widely used as communication media. On one hand, services such as blogs, tweets, forums, chats, email have gained wide popularity. On the other hand, due to the huge amount of available information, searching has become dominant in the use of Internet. Millions of users daily interact with search engines, producing valuable sources of interesting data regarding several aspects of the world. Bitcoin, a decentralized electronic currency, represents a radical change in financial systems, attracting a large number of users and a lot of media attention. In this work we studied whether Bitcoin’s trading volume is related to the web search and social volumes about Bitcoin. We investigated whether public sentiment, expressed in large-scale collections of daily Twitter posts, can be used to predict the Bitcoin market too. We achieved significant cross correlation outcomes, demonstrating the search and social volumes power to anticipate trading volumes of Bitcoin currency.

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Notes

  1. 1.

    https://twitter.com/.

  2. 2.

    http://trends.google.com.

  3. 3.

    http://www.blockchain.info.

  4. 4.

    https://dev.twitter.com/overview/documentation.

  5. 5.

    https://code.google.com/p/language-detection/.

  6. 6.

    https://blockchain.info/it/charts/market-price.

  7. 7.

    https://www.bitcoin.de/.

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Authors and Affiliations

  1. Universita’ degli Studi di Cagliari, Piazza d’Armi, 09123, Cagliari, Italy

    Martina Matta, Ilaria Lunesu & Michele Marchesi

Authors
  1. Martina Matta
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  2. Ilaria Lunesu
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  3. Michele Marchesi
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Corresponding author

Correspondence to Martina Matta .

Editor information

Editors and Affiliations

  1. Instituto de Telecomunicações/IST, Lisbon, Portugal

    Ana Fred

  2. Delft University of Technology, Delft, The Netherlands

    Jan L.G. Dietz

  3. University of Madeira, Funchal, Portugal

    David Aveiro

  4. University of Reading, Reading, United Kingdom

    Kecheng Liu

  5. Polytechnic Institute of Setúbal/INSTICC, Setúbal, Portugal

    Joaquim Filipe

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Matta, M., Lunesu, I., Marchesi, M. (2016). Is Bitcoin’s Market Predictable? Analysis of Web Search and Social Media. In: Fred, A., Dietz, J., Aveiro, D., Liu, K., Filipe, J. (eds) Knowledge Discovery, Knowledge Engineering and Knowledge Management. IC3K 2015. Communications in Computer and Information Science, vol 631. Springer, Cham. https://doi.org/10.1007/978-3-319-52758-1_10

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  • DOI: https://doi.org/10.1007/978-3-319-52758-1_10

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  • Online ISBN: 978-3-319-52758-1

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