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Author Topic: Bitcoin Price Regression Model  (Read 630 times)
danlogic
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November 27, 2013, 07:49:06 AM
 #1

Hey guys,

First of all, I'll introduce myself; I'm Dan, I'm a 23-year-old Economist-gone-Computer-Scientist currently studying Economics at a small University. I got interested in Bitcoin about a year ago, but never bought in (I own about 0.4 BTC from some previously generous faucets); I was more interested in watching its progress and speculating as an outsider.

Nonetheless, as an Economist, I'm incredibly interested in the currency. And as an assigned project for some of my schooling, I've been required to develop a multiple regression equation based upon anything - I chose the Bitcoin's price... Put simply, I'm trying to find which variables (to what degree, with what uncertainty, and blah blah [Economics stuff]) affect the Bitcoin.

Basically, I'm looking for some help in determining which variables I can include into my model to try to explain the BTC price [to whatever degree]

As an example of a 'possible' model:
BTC price = C1(volume traded at the time) + C2(increase in volume from past measure) + C3(bitcoins mined) + C4(total number of transactions)



If you have ANY ideas as to what you believe affects the BTC price (and can be easily quantified for given time periods), PLEASE let me know. Thanks Cool
(If this post is out of line for the Newbies forum, sorry... I'm a Newbie and tbch just wanted some other btcers opinions)
If/When I finish my shitty/eye-opening regression, I'd be happy to post it here.

Cheers and thanks,
-Danlogic
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obelisk910
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November 27, 2013, 10:50:30 AM
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An interesting concept.

Personally I think the biggest factor is what the majority of people think will happen to the value in the near future. I'm sure you are familiar with the self-fulfilling concept of market speculation, where expecting a price decrease will convince you and others to sell/not buy, which in turn reduces demand and contributes to price reduction.

I think that this factor probably realistically outweighs all the other ones. Simply the error of this factor I think is probably larger than the total effect of other factors combined. Particularly since factors such as current value and number of transactions could be lumped in with this. Find a way to break down the information that influences what people expect to happen to the value and you will be golden.

No sarcasm intended, http://www.whatdoestheinternetthink.net/ could potentially be useful if used strategically.

12JR7xsjnVHsrHHVAv1iyahW1SA8xEjbAR - Always appreciate donations if you found my posts helpful!
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