Analysis of the performance of Islamic gold-backed cryptocurrencies during the bear market of 2020

This study examines the performance of Islamic gold-backed cryptocurrencies during the bear market of 2020. Price data is collected for three Islamic gold-backed cryptocurrencies, OneGram, HelloGold and X8X, as well as the conventional gold-backed cryptocurrency, PaxGold, and the conventional fiat-backed cryptocurrency, Bitcoin, from December 2019 to November 2020. Analysis via ARMA-EGARCH models show that returns on all cryptocurrencies are lower during the bear market but the decrease is only significant for the Islamic gold-backed cryptocurrencies. Volatility is found to be higher for all five cryptocurrencies but the effect of the bear market on the volatility is only significant for the conventional cryptocurrencies.