Which Came First the Change in Trends or the Change in Price?

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When the price of crypto currencies move,
it generates a robust reaction throughout the globe. It appears that the news
permeates into customer curiosity, which increases the number of search terms
that are used on Google and other search engines. In fact, the news reaches the
Twitter universe and is captured in both Google and Twitter trends. The demand
for digital assets continues to expand, as new brokerage firms announce they
will enter the market.

Trying to Gather Data

In a recent paper, esearchers gathered data
on Twitter mentioning Bitcoin and Ethereum as well as performing the same task
using Google
trends. Building on the ideas of previous research, the hypothesis was that
the number of tweets and their sentiment can influence prices. In the study, it
was uncovered that the number of tweets and Google searches changes first
before prices do on iFOREX.
This means the ideas are floated throughout the internet community before they
are reflected in the price of a crypto currency.

Both Google and Social media outlets such
as Twitter can monitor terms that are used throughout the internet. This
provides traders with a gauge for the chatter across the internet universe.
Capturing this data and forming an anaysls based on current prices is a
technique that is used by many stock and currency traders. Algorithms are set
up to analyze commentary and determine whether that is positive or negative for
stock prices. For example, on Sunday, May 5, 2019, the US President Donald
Trump tweeted about trade issues with China which sent the Chinese stock market
down 7%.

Fidelity is Entering the Cyrpto Market

Its clear that more and more companies are
attempting to figure out how they can benefit from the crypto currency market.
Recently it was announced that Facebook is trying to put out its own coin.
Fidelity Investments, which began a custody service to store Bitcoin earlier
this year, announced that it will buy and sell the world’s most popular digital
asset for institutional customers. Fidelity is one of the largest asset
managers in the world. The firm said in October 2018 that it would offer
over-the-counter trade execution and order routing for Bitcoin.

Fidelity would join brokerages E*Trade
Financial Corp. and Robinhood in offering cryptocurrency trading to clients.
Fidelity released a study that found that its clients believe that digital
asset is worth the investment risk. Nearly 50% of the respondents were positive
on crypto currency investing. Fidelity polled more than 400 investors and more
than 70% prefer to buoy assets that hold digital investments.

The issue that was first on many of the
respondent’s minds is that crypto currencies continue to be plagued with fraud
and regulatory issues. For example, the NY attorney general accused Bitfinex of
hiding the loss of $850 million in client and corporate cash.

Its clear that more an more companies are
trying to enter the crypto currency market as the demand for digital assets
continues to rise.

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