Global Bitcoin Markets and Local Regulations
This paper investigates how the introduction of regulations for local Bitcoin markets will shape prices and trading activities in six major trading markets that comprise 99% of global trading volume.
It finds that local government regulations only have a short-lived impact on the Bitcoin price but discourage longer-term trading activities in local markets. The paper also finds that the repressive effect of domestic regulations on trading activities can be mitigated by domestic financial market openness. It documents consistent evidence that Bitcoin markets are globally integrated but international cooperation is essential to uphold market integrity.
- Literature review and contribution of the study
- Conclusion and policy implications