Library Header Image
LSE Research Online LSE Library Services

Are cryptos different? Evidence from retail trading

Kogana, Shimon, Makarov, Igor, Niessnerc, Marina and Schoar, Antoinette (2024) Are cryptos different? Evidence from retail trading. Journal of Financial Economics. ISSN 0304-405X (In Press)

[img] Text (Are Cryptos Different) - Accepted Version
Pending embargo until 1 January 2100.
Available under License Creative Commons Attribution Non-commercial No Derivatives.

Download (1MB) | Request a copy


Trading in cryptocurrencies grew rapidly over the last decade, dominated by retail investors. Using data from eToro, we show that retail traders have different models of the underlying price dynamics of cryptocurrencies relative to other assets: They are contrarian in stocks and gold, yet these same traders follow a buy-and-hold strategy in cryptocurrencies. The differences are not explained by individual characteristics, investor composition, inattention, differences in fees, nor preference for lottery-like stocks. We conjecture that retail investors have a model where cryptocurrency price changes also affect the likelihood of future widespread adoption, which pushes prices further in the same direction.

Item Type: Article
Official URL:
Additional Information: © 2024 Elsevier
Divisions: Finance
Subjects: H Social Sciences > HG Finance
JEL classification: G - Financial Economics > G1 - General Financial Markets > G12 - Asset Pricing; Trading volume; Bond Interest Rates
G - Financial Economics > G1 - General Financial Markets > G14 - Information and Market Efficiency; Event Studies
Date Deposited: 11 Mar 2024 14:45
Last Modified: 14 Jun 2024 13:57

Actions (login required)

View Item View Item


Downloads per month over past year

View more statistics