Financial Regulations and Price Inconsistencies Across Bitcoin Markets

45 Pages Posted: 11 Jan 2017  

Gina C. Pieters

Trinity University - Department of Economics

Sofia Vivanco

Trinity University

Multiple version iconThere are 2 versions of this paper

Date Written: 2016-12-01

Abstract

We document systematic differences in bitcoin prices across 11 different markets representing 26% of global bitcoin trade volume. These differences must — due to the identical nature of all bitcoin — result from characteristics of markets themselves. We examine differences across the markets and find that those which do not require customer identification for establishing an account are more likely to deviate from representative market prices than those which do. This implies that standard financial regulations, specifically know-your-customer regulations, can have a non-negligible impact on the bitcoin market.

JEL Classification: G12, G14, K42, L86

Suggested Citation

Pieters, Gina C. and Vivanco, Sofia, Financial Regulations and Price Inconsistencies Across Bitcoin Markets (2016-12-01). Globalization and Monetary Policy Institute Working Paper No. 293. Available at SSRN: https://ssrn.com/abstract=2896643

Gina C. Pieters (Contact Author)

Trinity University - Department of Economics ( email )

San Antonio, TX 78212
United States

Sofia Vivanco

Trinity University ( email )

San Antonio, TX 78212
United States

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