adminCryptocurrency news is the latest information about the cryptocurrency industry. This can include news about regulation, forks, trading, and more. Keeping up with the latest crypto news can help traders stay ahead of the curve and make smart investment decisions.
News flows are an important factor that influences asset prices (Riordan and Kalev, 2004). With the advent of technology, financial markets now receive information from newswires in seconds and are influenced by this real-time information flow, which affects trading activity and, ultimately, asset price discovery.
With the increased popularity of cryptocurrencies and web3 technologies, new publications have started publishing crypto-specific content. However, these publications often fail to deliver accurate and objective information. This raises the need for independent crypto media, based on the five core journalistic principles: accuracy, fairness, impartiality, truthfulness, and responsibility.
To understand how the cryptocurrency market behaves, we have developed a sentiment indicator that is based on lexicon-based Natural Language Processing (NLP). The indicator uses daily news headlines to measure positive and negative news sentiments. We then analyze the impact of these news sentiments on cryptocurrency returns, volatility, and liquidity. We find that positive news sentiment increases cryptocurrency returns, while negative news sentiment decreases them. Positive news also leads to more noise trading, whereas negative news increases uncertainty. Consequently, it reduces the trading activity of informed and uninformed investors and, consequently, liquidity.
We also find that the oldest cryptocurrency, Bitcoin, experiences a “negativity effect” and exhibits an inverted asymmetric volatility pattern. This is mainly because negative news is more likely to trigger the participation of uninformed traders who buy due to the fear of missing out, which results in pump-and-dump schemes.
