Following regulatory changes, Bitcoin prices were tracked by the crypto-positive financial services firm and revealed clear evidence of their impact.
The need for regulation is a popular topic in discussions about cryptocurrency, and the argument is frequently taken to be self-evidently true. Now, New York Digital Investment Group (NYDIG) has conducted some number crunching to support this position. NYDIG quantified the impact of regulation on the Bitcoin price worldwide in a new research.
The NYDIG research focused on Bitcoin prices at set intervals following regulatory events impacting digital asset taxation, accounting and payments as well as service providers’ legality and the assets themselves. The study looked at the Americas, Europe, China, and Asia outside of China during a time period beginning September 30, 2011, and ending March 31, 2022.
The number of regulatory incidents was assessed, which ran from 17 in the United States to 10 in China. In every situation, including China, Bitcoin prices increased by at least 100% within a year after a regulatory event, and values rose by over 100% in each case in 365 days.
Bitcoin’s returns were not significantly different from the “average Bitcoin return.” The same was true for Bitcoin price data relative to the average Bitcoin return. In absolute terms, Bitcoin prices rose 160.4% within 365 days after regulatory events in the Americas, whereas they increased 32.3% in relative terms (figure 1). 180.1 percent and 52.0 percent, respectively, in Europe (figure 2). 116.9% and -11 .2%, excepting China, elsewhere in Asia.
China was the exception that proved the rule. The Chinese government’s regulation of digital assets was dubbed “existential,” according to the researchers, who added that it increased gradually over time. As a result, their research findings on Bitcoin prices in China’s regulatory environment were also evidence of how regulation affects cryptocurrency values.
Nonetheless, the authors are certain that, because to the breadth of their survey, “the effects of this noise are somewhat lessened.”
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