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Which Cryptocurrencies Are Mostly Traded in Distressed Times?

Department of Economics, University of Thessaly, 28th October 78 Street, 38333 Volos, Greece
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J. Risk Financial Manag. 2019, 12(3), 135; https://doi.org/10.3390/jrfm12030135
Received: 10 July 2019 / Revised: 13 August 2019 / Accepted: 14 August 2019 / Published: 20 August 2019
(This article belongs to the Special Issue Blockchain and Cryptocurrencies)
This paper investigates the level of liquidity of digital currencies during the very intense bearish phase in their markets. The data employed span the period from April 2018 until January 2019, which is the second phase of bearish times with almost constant decreases. The Amihud’s illiquidity ratio is employed in order to measure the liquidity of these digital assets. Findings indicate that the most popular cryptocurrencies exhibit higher levels of liquidity during stressed periods. Thereby, it is revealed that investors’ preferences for trading during highly risky times are favorable for well-known virtual currencies in the detriment of less-known ones. This enhances findings of relevant literature about strong and persistent positive or negative herding behavior of investors based on Bitcoin, Ethereum and highly-capitalized cryptocurrencies in general. Notably though, a tendency towards investing in the TrueUSD stablecoin has also emerged. View Full-Text
Keywords: Bitcoin; cryptocurrency; liquidity Bitcoin; cryptocurrency; liquidity
MDPI and ACS Style

Kyriazis, Ν.A.; Prassa, P. Which Cryptocurrencies Are Mostly Traded in Distressed Times? J. Risk Financial Manag. 2019, 12, 135. https://doi.org/10.3390/jrfm12030135

AMA Style

Kyriazis ΝA, Prassa P. Which Cryptocurrencies Are Mostly Traded in Distressed Times? Journal of Risk and Financial Management. 2019; 12(3):135. https://doi.org/10.3390/jrfm12030135

Chicago/Turabian Style

Kyriazis, Νikolaos A., and Paraskevi Prassa. 2019. "Which Cryptocurrencies Are Mostly Traded in Distressed Times?" Journal of Risk and Financial Management 12, no. 3: 135. https://doi.org/10.3390/jrfm12030135

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