ABSTRACT
We revisit the "fear of missing out” (FoMO) effect of Bitcoin by observing asymmetric volatility dynamics and further investigate its driving factors. Using a longer sample period covering the COVID-19 pandemic, our results show evidence of positive asymmetric volatility behavior in the Bitcoin market, confirming the presence of the FoMO effect. This effect also exists in some other major cryptocurrencies. Further analysis indicates that the happiness index, the ratio of short-term to long-term Bitcoin trading volume, and the geopolitical risk index contribute positively to the FoMO, while the volatility index and the Twitter-based uncertainty index exert an opposite effect.
ABSTRACT
We use transaction data on CryptoPunks to dissect the factors affecting the returns of non-fungible tokens (NFTs). Our results show that trading volume in the short period before a trader buys (sells) CryptoPunk relates negatively (positively) to the returns on NFTs, suggesting that when market trading volume is at a high level, NFT owners are better off on the sell side, and investors interested in NFTs should avoid joining the herd. Turnover of a token tends to harm its returns. Finally, both traders' willingness to purchase and trading experience have a positive impact on NFT returns within short-term investment horizons.