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Understanding Bitcoin: Its role in asset price spillovers, responses to monetary policy and impact on global CO2 emissions / OLUWASEUN OLUWASINA

Swansea University Author: OLUWASEUN OLUWASINA

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DOI (Published version): 10.23889/SUthesis.68441

Abstract

In a world increasingly driven by technological advancements, cryptocurrencies emerge as a paradox: a beacon of financial innovation with significant environmental costs. This thesis explores Bitcoin's interactions with economic variables and its carbon footprint, aiming to uncover the broader...

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Published: Swansea, Wales, UK 2024
Institution: Swansea University
Degree level: Doctoral
Degree name: Ph.D
Supervisor: Chowdhury, Rosen ; O’Leary, Nigel
URI: https://cronfa.swan.ac.uk/Record/cronfa68441
first_indexed 2024-12-03T13:48:31Z
last_indexed 2025-02-11T05:53:00Z
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recordtype RisThesis
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spelling 2025-02-10T10:42:07.6549308 v2 68441 2024-12-03 Understanding Bitcoin: Its role in asset price spillovers, responses to monetary policy and impact on global CO2 emissions bfecdf3112e7cb79600d1affd8033060 OLUWASEUN OLUWASINA OLUWASEUN OLUWASINA true false 2024-12-03 In a world increasingly driven by technological advancements, cryptocurrencies emerge as a paradox: a beacon of financial innovation with significant environmental costs. This thesis explores Bitcoin's interactions with economic variables and its carbon footprint, aiming to uncover the broader implications of its disruptive presence in both financial markets and ecological sustainability. The first chapter investigates spillover effects between Bitcoin and traditional financial indices and volatility measures. Findings indicate that Bitcoin exhibits significant self-explained variance and minimal spillover from other markets. Despite failing to act as a traditional safe haven during market crises, Bitcoin's relative isolation underscores its unique role due to decentralisation. This contributes to understanding Bitcoin's stability and interconnectedness with broader financial markets, particularly during the COVID-19 pandemic. The second chapter explores the asymmetric impact of U.S. monetary policy on Bitcoin's price. Analysis reveals that Bitcoin prices react differently to monetary policy shocks depending on the interest rate regime. During high interest rates, Bitcoin prices experience substantial and prolonged declines, while the impact is less severe during low interest rates. Highlighting Bitcoin's sensitivity to monetary policy changes. The results suggest why and how cryptocurrencies fit into the asset-based channels of the monetary transmission mechanism. The final chapter assesses the long-run relationship between Bitcoin's carbon emissions and global carbon emissions. Findings establish a positive long-term cointegrating relationship between Bitcoin-related CO2 emissions and global CO2 levels. indicating that while Bitcoin's immediate impact is small, sustained mining could have significant long-term effects. E-Thesis Swansea, Wales, UK Cryptocurrency, Bitcoin, Bitcoin Electricity Consumption, CO2 emissions, Monetary Policy, Asset Price Spillovers, Safe Haven, Local Projections, Impulse Response Functions, TVP-VAR, SVECM 12 11 2024 2024-11-12 10.23889/SUthesis.68441 COLLEGE NANME COLLEGE CODE Swansea University Chowdhury, Rosen ; O’Leary, Nigel Doctoral Ph.D 2025-02-10T10:42:07.6549308 2024-12-03T11:40:38.2853119 Faculty of Humanities and Social Sciences School of Social Sciences - Economics OLUWASEUN OLUWASINA 1 68441__33027__664c714c6fa44bac8334a812c7fee9ab.pdf Oluwasina_Oluwaseun_PhD_Thesis_Final_Cronfa.pdf 2024-12-03T11:49:43.7907198 Output 2664990 application/pdf E-Thesis – open access true Copyright: The author, Oluwaseun Iruoghene Daisy Oluwasina, 2024. true eng
title Understanding Bitcoin: Its role in asset price spillovers, responses to monetary policy and impact on global CO2 emissions
spellingShingle Understanding Bitcoin: Its role in asset price spillovers, responses to monetary policy and impact on global CO2 emissions
OLUWASEUN OLUWASINA
title_short Understanding Bitcoin: Its role in asset price spillovers, responses to monetary policy and impact on global CO2 emissions
title_full Understanding Bitcoin: Its role in asset price spillovers, responses to monetary policy and impact on global CO2 emissions
title_fullStr Understanding Bitcoin: Its role in asset price spillovers, responses to monetary policy and impact on global CO2 emissions
title_full_unstemmed Understanding Bitcoin: Its role in asset price spillovers, responses to monetary policy and impact on global CO2 emissions
title_sort Understanding Bitcoin: Its role in asset price spillovers, responses to monetary policy and impact on global CO2 emissions
author_id_str_mv bfecdf3112e7cb79600d1affd8033060
author_id_fullname_str_mv bfecdf3112e7cb79600d1affd8033060_***_OLUWASEUN OLUWASINA
author OLUWASEUN OLUWASINA
author2 OLUWASEUN OLUWASINA
format E-Thesis
publishDate 2024
institution Swansea University
doi_str_mv 10.23889/SUthesis.68441
college_str Faculty of Humanities and Social Sciences
hierarchytype
hierarchy_top_id facultyofhumanitiesandsocialsciences
hierarchy_top_title Faculty of Humanities and Social Sciences
hierarchy_parent_id facultyofhumanitiesandsocialsciences
hierarchy_parent_title Faculty of Humanities and Social Sciences
department_str School of Social Sciences - Economics{{{_:::_}}}Faculty of Humanities and Social Sciences{{{_:::_}}}School of Social Sciences - Economics
document_store_str 1
active_str 0
description In a world increasingly driven by technological advancements, cryptocurrencies emerge as a paradox: a beacon of financial innovation with significant environmental costs. This thesis explores Bitcoin's interactions with economic variables and its carbon footprint, aiming to uncover the broader implications of its disruptive presence in both financial markets and ecological sustainability. The first chapter investigates spillover effects between Bitcoin and traditional financial indices and volatility measures. Findings indicate that Bitcoin exhibits significant self-explained variance and minimal spillover from other markets. Despite failing to act as a traditional safe haven during market crises, Bitcoin's relative isolation underscores its unique role due to decentralisation. This contributes to understanding Bitcoin's stability and interconnectedness with broader financial markets, particularly during the COVID-19 pandemic. The second chapter explores the asymmetric impact of U.S. monetary policy on Bitcoin's price. Analysis reveals that Bitcoin prices react differently to monetary policy shocks depending on the interest rate regime. During high interest rates, Bitcoin prices experience substantial and prolonged declines, while the impact is less severe during low interest rates. Highlighting Bitcoin's sensitivity to monetary policy changes. The results suggest why and how cryptocurrencies fit into the asset-based channels of the monetary transmission mechanism. The final chapter assesses the long-run relationship between Bitcoin's carbon emissions and global carbon emissions. Findings establish a positive long-term cointegrating relationship between Bitcoin-related CO2 emissions and global CO2 levels. indicating that while Bitcoin's immediate impact is small, sustained mining could have significant long-term effects.
published_date 2024-11-12T05:28:53Z
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score 11.055843

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