Formation of Bitcoin bubbles
DOI:
https://doi.org/10.15170/MM.2025.59.03.07Keywords:
crypto currencies, Bitcoin, bubbles, Gartner hype curve, imitative behaviourAbstract
THE AIM OF THE PAPER
The aim of the study is to examine and understand the formation of Bitcoin bubbles These bubbles exhibit strong similarity to the shape of the Gartner hype curve, so the relationship between individual bubbles and the hype curve is also discussed. Additionally, we sought to uncover factors contributing to the formation of Bitcoin bubbles.
METHODOLOGY
We analyzed the historical data of Bitcoin prices, which reveal the existence of bubbles. To support the existence of bubbles and to identify them with the Gartner hype curve, we calculated the risks and returns associated with different periods of each bubble. We also fitted the hype curve to the Bitcoin exchange rate and examined the correlation between the two.
MOST IMPORTANT RESULTS
The risks calculated from the standard deviation, as well as the relative standard deviations, also supported the assumption that individual Bitcoin bubbles follow the shape of the Gartner hype curve. And fitting the curves and examining the correlation showed that there is a relationship between hype and exchange rate movements. The role of regulation can be critical in shaping cryptocurrency prices, and regulatory measures implemented in different countries can significantly affect investor confidence and prices, which are also mentioned in the study. The halving of Bitcoin rewards for mining is also an important event that can affect supply and demand, and consequently prices. The imitative behavior, or the tendency of investors to mimic the behavior of others, can also be a significant factor in bubble formation. Finally, the stabilising effect of institutional actors is described.
RECOMMENDATIONS
The study reveals that the aforementioned factors have a significant influence on the price of Bitcoin, among which the halving of mining rewards is the most prominent and calculable. While we cannot anticipate new regulations, we can anticipate price changes associated with halving, which is mainly indicated by imitative behavior, as investors seek to maximize their returns. Based on these, the study highlights that it is a very risky form of investment, the forecast of which is a very difficult task.
References
Antal-Molnár, N. (2021), „A blokklánc technológia és annak lehetséges alkalmazása az egészségügyben és a közigazgatásban”, in: Bujtár, Zs. (ed.), Kriptoeszközök világa a jog és a gazdaság szemszögéből, PTE ÁJK, Pécs, pp. 187–197.
Bocsó, R. (2016), „Virtuális valuta mint a modern kori pénzpiaci szabályozás kihívása”, Polgári Szemle, 12(1–3), pp. 244–251.
Bouri, E., Gupta, R. and Roubaud, D. (2018), “Herding behaviour in cryptocurrencies”, Finance Research Letters, 29, pp. 216–221. https://doi.org/10.1016/j.frl.2018.07.008
Bugár, Gy. and Somogyvári, M. (2020), „Bitcoin: digitális szemfényvesztés, vagy a jövő valutája?”, Hitelintézeti Szemle, 19(1), pp. 132–153. https://doi.org/10.25201/HSZ.19.1.132153
Bugár, Gy. and Uzsoki, M. (2013), “Challenges and Achievements in Gauging Investment Risk”, Journal of Transnational Management, 18(1), pp. 39–51. https://doi.org/10.1080/15475778.2013.752781
Czeczeli, V. and Vilonya, M. (2022), „A kriptovaluták árfolyamának alakulása eseményelemzés alapján”, Pénzügyi Szemle, 67(2), pp. 235–251. https://doi.org/10.35551/PSZ_2022_2_5
Erdős, S. and Papp, T. (2021), „Az utánzás-alapú dimenzió megjelenése a közösségi kereskedés másolási döntéseiben”, Marketing & Menedzsment, 55(KSZ.2), pp. 83–90. https://doi.org/10.15170/MM.2021.55.KSZ.02.07
Gerlach, J., Demos, G. and Sornette, D. (2019), “Dissection of Bitcoin’s Multiscale Bubble History from January 2012 to February 2018”, Royal Society Open Science, 6(7), pp. 1–28. https://doi.org/10.1098/rsos.180643
Hasavari, S., Maddah, M. and Esmaeilzadeh, P. (2025), “Government Oversight and Institutional Influence: Exploring the Dynamics of Individual Adoption of Spot Bitcoin ETPs”, Journal of Risk and Financial Management, 18(4), 175. https://doi.org/10.3390/jrfm18040175
Huber, T.A. and Sornette, D. (2022), “Boom, Bust and Bitcoin: Bitcoin-Bubbles as Innovation Accelerators”, Journal of Economic Issues, 56(1), pp. 113–136. https://doi.org/10.1080/00213624.2022.2020023
Linden, A. and Fenn, J. (2003), “Understanding Gartner’s Hype Cycles”, in: Strategic Analysis Report (e-document), pp. 1–12. https://www.studocu.com/en-za/document/north-west-university/information-security/gartner-hype-cycle/2279430 [letöltve: 2025.10.06.]
Lyócsa, S., Molnár, P., Plíhal, T. and Siranová, M. (2020), “Impact of macroeconomic news, regulation and hacking exchange markets on the volatility of Bitcoin”, Journal of Economic Dynamics & Control, 119, 103980. https://doi.org/10.1016/j.jedc.2020.103980
Magzinov, R., Kuznetsov, S., Kasatova, A., Gilmanov, M., Garipova, V. and Kuznetsov, A. (2019), “Problems of criminal responsibility for illegal circulation of cryptocurrency”, in: 12th International Conference on Developments in eSystems Engineering (DeSE), Kazan, Russia, pp. 996–999. https://doi.org/10.1109/DeSE.2019.00185
Rehman, M. ur H., Salah, K., Damiani, E. and Svetinovic, D. (2020), “Trust in blockchain cryptocurrency ecosystem”, IEEE Transactions on Engineering Management, 67(4), pp. 1196–1212. https://doi.org/10.1109/TEM.2019.2948861
Sornette, D., Johansen, A. and Bouchaud, J.P. (1996), “Stock market crashes, precursors and replicas”, J. Phys. I France, 6(1), pp. 167–175. https://doi.org/10.1051/jp1:1996135
Wheatley, S., Sornette, D., Huber, T., Reppen, M. and Gantner, R.N. (2019), “Are Bitcoin bubbles predictable? Combining a generalized Metcalfe’s Law and the Log-Periodic Power Law Singularity model”, Royal Society Open Science, 6(6), 180538. https://doi.org/10.1098/rsos.180538
Gartner Inc. (2018), “Understanding Gartner’s Hype Cycles”, Gartner Inc., available at: www.gartner.com/en/documents/3887767 [utolsó letöltés: 2022.05.05.]
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2025 The Hungarian Journal of Marketing and Management
This work is licensed under a Creative Commons Attribution-NoDerivatives 4.0 International License.
