This event is part of the CyLab Seminar Series and is made possible by a generous grant from the Ripple University Blockchain Research Initiative.


Speaker: Bruno Biais, Professor, HEC Paris

Topic: Equilibrium Bitcoin Pricing

We offer an equilibrium model of cryptocurrency pricing and confront it to new data on bitcoin transactional benefits and costs. The model emphasises that the fundamental value of the cryptocurrency is the stream of net transactional benefits it will provide, which depend on its future prices. The link between future and present prices implies that returns can exhibit large volatility, unrelated to fundamentals. We construct an index measuring the ease with which bitcoins can be used to purchase goods and services, and we also measure costs incurred by bitcoin owners. Consistent with the model, estimated transactional net benefits explain a statistically significant fraction of bitcoin returns.



Bruno Biais holds a Ph.D. in finance from HEC, received the Paris Bourse dissertation award and the CNRS bronze medal. He taught at Toulouse, Carnegie Mellon, Oxford, LSE, and now HEC. His research on finance, contract theory, and experimental economics is published in Econometrica, JPE, AER, Review of Economic Studies, Journal of Finance, RFS and JFE. He was editor of the Review of Economic Studies and of the Journal of Finance. He is a fellow of the Econometric Society and the Finance Theory group and has been scientific adviser to the NYSE, Euronext, European Central Bank, and Bank of England.

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