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Cryptocurrency hacking and trader behavior in bitcoin futures

Author

Listed:
  • Chen, Yu-Lun
  • Yang, J. Jimmy

Abstract

We investigate the effect of cryptocurrency hacking on trader positions in CME bitcoin futures. Our results indicate that the occurrence of hacking and fraudulent incidents lead to more net-short positions and fewer participation ratio for leveraged funds in bitcoin futures. Additionally, U.S. dollar index, futures basis, and price efficiency also play significant roles in the trading of leveraged funds. Lastly, we find that the number of hacking incidents negatively affects dealers’ net-long positions. This study provides new insights into trader behaviors in bitcoin futures and offers practical implications for bitcoin investors and regulators.

Suggested Citation

  • Chen, Yu-Lun & Yang, J. Jimmy, 2024. "Cryptocurrency hacking and trader behavior in bitcoin futures," Finance Research Letters, Elsevier, vol. 69(PB).
    • Handle: RePEc:eee:finlet:v:69:y:2024:i:pb:s154461232401211x
    DOI: 10.1016/j.frl.2024.106182
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    More about this item

    Keywords

    Bitcoin futures; Hacking incidents; Traders in financial futures (TFF); Hedge funds;
    All these keywords.

    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G20 - Financial Economics - - Financial Institutions and Services - - - General

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