Taming the Blockchain Beast? Regulatory Implications for the Cryptocurrency Market

23 Pages Posted: 14 Jun 2019

See all articles by Savva Shanaev

Savva Shanaev

Northumbria University; Government of the Russian Federation - Financial University (Moscow Branch)

Satish Sharma

University of Northumbria at Newcastle

Arina Shuraeva

University of London

Binam Ghimire

University of Northumbria at Newcastle

Date Written: May 24, 2019

Abstract

This paper uses a unique dataset of 120 regulatory events from five classes to test the relevance of the regulatory framework for cryptocurrency value. Time-series market-wide estimates and panel estimates for 300 individual coins and tokens show statistically and economically significant impact of anti-money laundering and issuance regulation. Tighter regulation and more active role of government decrease cryptocurrency prices, evidencing that potentially lower risks and wider adoption commonly attributed to the establishment of the regulatory framework do not compensate for respective efficiency and consumer utility losses. The market is generally efficient in reflecting regulatory information in cryptocurrency prices.

Keywords: cryptocurrency, cryptocurrency regulation, anti-money laundering, event studies

JEL Classification: C32, C33, E42, G14, G18

Suggested Citation

Shanaev, Savva and Sharma, Satish and Shuraeva, Arina and Ghimire, Binam, Taming the Blockchain Beast? Regulatory Implications for the Cryptocurrency Market (May 24, 2019). Available at SSRN: https://ssrn.com/abstract=3397939 or http://dx.doi.org/10.2139/ssrn.3397939

Savva Shanaev (Contact Author)

Northumbria University ( email )

Pandon Building
208, City Campus East-1
Newcastle-Upon-Tyne, Newcastle NE1 8ST
United Kingdom

Government of the Russian Federation - Financial University (Moscow Branch) ( email )

Satish Sharma

University of Northumbria at Newcastle ( email )

Arina Shuraeva

University of London ( email )

Senate House
Malet Street
London, WC1E 7HU
United Kingdom

Binam Ghimire

University of Northumbria at Newcastle ( email )

Pandon Building
208, City Campus East-1
Newcastle-Upon-Tyne, Newcastle NE1 8ST
United Kingdom

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