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What Drives Cryptocurrency Prices?: An Investigation of Google Trends and Telegram Sentiment

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Nico SmutsAuthors Info & Claims

ACM SIGMETRICS Performance Evaluation Review, Volume 46, Issue 3

Pages 131 - 134

https://doi.org/10.1145/3308897.3308955

Published: 25 January 2019 Publication History

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Abstract

The Google Trends¹ search analysis service and the Telegram² messaging platform are investigated to determine their respective relationships to cryptocurrency price behaviour. It is shown that, in contrast to earlier findings, the relationship between cryptocurrency price movements and internet search volumes obtained from Google Trends is no longer consistently positive, with strong negative correlations detected for Bitcoin and Ethereum during June 2018. Sentiment extracted from cryptocurrency investment groups on Telegram is found to be positively correlated to Bitcoin and Ethereum price movements, particularly during periods of elevated volatility. The number of messages posted on a Bitcoin-themed Telegram group is found to be an indicator of Bitcoin price action in the subsequent week. A long shortterm memory (LSTM) recurrent neural network is developed to predict the direction of cryptocurrency prices using data obtained from Google Trends and Telegram. It is shown that Telegram data is a better predictor of the direction of the Bitcoin market than Google Trends. The converse is true for Ethereum. The LSTM model produces the most accurate results when predicting price movements over a one-week period.

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cover image ACM SIGMETRICS Performance Evaluation Review

ACM SIGMETRICS Performance Evaluation Review Volume 46, Issue 3

December 2018

174 pages

ISSN:0163-5999

DOI:10.1145/3308897

Editor:
Nidhi Hegde
Borealis AI

Issue’s Table of Contents

Permission to make digital or hard copies of part or all of this work for personal or classroom use is granted without fee provided that copies are not made or distributed for profit or commercial advantage and that copies bear this notice and the full citation on the first page. Copyrights for third-party components of this work must be honored. For all other uses, contact the Owner/Author.

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Association for Computing Machinery

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Published: 25 January 2019

Published in SIGMETRICS Volume 46, Issue 3

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(2024)AI Applications in Analysing and Predicting Cryptocurrency MarketRecent trends in Management and Commerce10.46632/rmc/5/2/85:2(42-46)Online publication date: 13-Jul-2024
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Trần Sơn TLại Hoài PĐào Thị Thanh B(2024)Tâm lý thị trường, bất ổn kinh tế và biến động tiền mã hoáTạp chí Kinh tế và Phát triển10.33301/JED.VI.1707Online publication date: 2024
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An event study of the effects of cryptocurrency thefts on cryptocurrency prices

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