Another Look at Cryptocurrency Bubbles

15 Pages Posted: 25 Jul 2019

See all articles by Marc Gronwald

Marc Gronwald

University of Aberdeen; CESifo (Center for Economic Studies and Ifo Institute)

Date Written: 2019


This paper deals with cryptocurrency bubbles. First, it points out that a number of recent papers on cryptocurrency bubbles are awed due to an insufficient consideration of the fundamental value of cryptocurrencies. As even fiat money is said to exhibit features of bubbles, the same applies to cryptocurrencies. Thus, any empirical investigation into either the presence of cryptocurrency bubbles or the fundamental value of cryptocurrencies is needless. Second, the paper conducts a short empirical analysis into the relationship of the prices of Etherum and Bitcoin. Evidence of explosive periods is found in the price of Etherum even if this price is expressed in terms of Bitcoin rather than US Dollars. These periods, however, are found to be in the first half of 2016 and 2017, respectively, but not during the price peak period of Bitcoin witnessed end of 2017 and beginning of 2018.

Keywords: cryptocurrencies, bubbles, bitcoin, Etherum, fundamental value, intrinsic value, fiat money

JEL Classification: C120, C220, E420, E520, G120

Suggested Citation

Gronwald, Marc, Another Look at Cryptocurrency Bubbles (2019). CESifo Working Paper No. 7743, Available at SSRN: or

Marc Gronwald (Contact Author)

University of Aberdeen ( email )

Dunbar Street
Aberdeen, Scotland AB24 3QY
United Kingdom

CESifo (Center for Economic Studies and Ifo Institute) ( email )

Poschinger Str. 5
Munich, DE-81679

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