Competition in unregulated environments: An inquiry into cryptocurrency firms




Hardy, Felix

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Looking into the unregulated markets of cryptocurrency, we wanted to find out how individual firms compete amongst each other. Cryptocurrency markets, in contrast to legacy securities markets, operate in a grey area and have an easier time bending the rules than traditional financial institutions -- because they are not yet classified as such. In these new markets, what drives consumers to choose one firm (exchange) over the other? With the amount of variables and freedom that these firms have due to the unregulated nature of the markets, we can get a clearer view into the raw behaviors of them. Through my rough initial models, I determined three of the most likely significant factors consumers weigh when choosing a firm. The factor most likely to have the largest impact was twitter followers and outreach, followed by trust and products offered by the firm. More rigorous modelling techniques along with more complex data will be used by Dr Xu to develop a comprehensive model.



currency, banking, crypto, economics, competition