- After a hacking incident, Bitcoin’s volatility spiked on the sixth day.
- A group from Finland’s University of Vaasa is looking into the influence.
There has been an increase in cryptocurrency theft and fraud. Two people were detained last month for allegedly stealing crypto. Bitfinex’s platform had 4.5 billion dollars worth of cryptocurrency stolen in 2016, according to the current prices.
As per a study by Chainalysis, criminals stole a record $3.2 billion in cryptocurrency last year. A group from the Finland’s University of Vaasa is looking into the influence of these big thefts on Bitcoin’s price, according to the news report. Once the news of a breach surfaced, they watched the market’s reaction to calculate when it would happen.
Delayed Reaction on Prices
Between 2013 and 2017, 1.1 million bitcoins were stolen. During this time, the team decided to do their homework to get the most bang for their buck. Since Bitcoin is now priced at about $42,000, the losses are measured in billions of dollars. That so, it’s fair to anticipate that this will have a major impact on both society and the markets.
In his research paper, Dr. Klaus Grobys outlines how he examined 29 instances of hacking in the Bitcoin market. According to Grobys, the volatility of Bitcoin does not increase between the second and fourth days after a hacking incident. According to the findings, volatility seems to have a delayed response. After a hacking incident, Bitcoin’s volatility spiked on the sixth day.
As per Grobys, future research will provide even more fascinating findings. In the wake of attacks on the Bitcoin market, other cryptocurrencies are also affected. Volatility increases as a result of hacking assaults. The volatility of the Ethereum market, for example, increases by five days if the wait is longer than that. Furthermore, the level of volatility is in line with that of Bitcoin.