Exploring the Key Determinants of BTC/USD Exchange Rates

Student: Zhevannik Daniil

Educational Programme: Financial Markets and Financial Institutions (Master)

Year of Graduation: 2024

The aim of the study is to identify the key determinants of pricing in the BTC/USD currency pair. We consider the influence of macroeconomic, technological, behavioral factors, and the issuance of Tether. To address this task, ARIMAX models and gradient boosting over decision trees were utilized. A strong correlation was found between BTC returns and the Nasdaq index. As the cryptocurrency market evolves, the impact of technological and behavioral factors has diminished, although their inclusion improves the predictive ability of the model. It is anticipated that the analysis of key factors will be used to make informed financial decisions.

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