Results of the RIGE project

Prof. dr hab. Barbara Będowska-Sójka
Conferences

Prof. dr hab. Barbara Będowska-Sójka

Conference Name: 2024 International Society for Advancement of Financial Economics Conference (ISAFE-2024) Organizer: Kasetsart University - Sriracha Campus, AVSE Global, International Society for the Advancement in Financial Economics (ISAFE); National Research Council of Thailand Date: 08-10 July 2024 Presentation Title: Interaction Effects in the Cross-Section of Cryptocurrency Returns

In the field of asset pricing, various interactions between anomalies in stock returns have been extensively studied, showing that certain return patterns can reinforce each other. Notable examples include heightened momentum returns observed in small and illiquid stocks and the dynamic interplay...

In the field of asset pricing, various interactions between anomalies in stock returns have been extensively studied, showing that certain return patterns can reinforce each other. Notable examples include heightened momentum returns observed in small and illiquid stocks and the dynamic interplay between value, momentum, and profitability factors.

Empirical research has identified many significant interactions, highlighting their importance for two main reasons. First, these interactions provide insights into the underlying mechanisms driving return patterns in equity markets, thereby enhancing theoretical understanding of market behavior. Second, on a practical level, knowledge of these interactions can be leveraged to develop effective investment strategies. The growing application of machine learning in finance further confirms that accounting for non-linearities and other complex interactions can significantly improve return forecasts and portfolio performance.

This study focuses on interaction effects in cryptocurrency markets. We constructed and evaluated portfolios sorted by two characteristics using a total of 40 different features. Utilizing a dataset of over 500 major coins and tokens spanning 2017–2023, we identified numerous significant interactions. The strongest effects arise from the interplay between liquidity, risk, and past return measures. An out-of-sample long-short strategy, weighted equally (or by value), that selects the top and bottom interactions generates an average weekly return of 1.18% (1.05%) with a Sharpe ratio of 1.54 (1.06). However, network chart analysis and further tests reveal how low liquidity, which increases transaction costs, can discourage trading and contribute to the persistence of anomalies.

Co-authors: Aleksander Mercik, Sitara Karim, Adam Zaremba

Joanna Bernacka, Szkoła Doktorska
Conferences

Joanna Bernacka, Szkoła Doktorska

Conference Name: 84th Annual Meeting of the Academy of Management "Innovating for the future. Policy, Purpose, and Organizations.” Organizer: the Academy of Management (AOM 2024) Date: 9-13.08.2024 Presentation Title: An Innovative organizational Approach: Motivation by Values thru Organization’s ‘Valubility’

Innovative Organizational Approach: Motivation Through Organizational ‘Valubility’ This research explores an innovative approach to organizational management, focusing on aligning organizational values with personal values to enhance employee motivation and...

Innovative Organizational Approach: Motivation Through Organizational ‘Valubility’

This research explores an innovative approach to organizational management, focusing on aligning organizational values with personal values to enhance employee motivation and engagement. It introduces the concept of “Valubility,” a blend of the ideas of value and ability. This framework suggests that organizations can leverage their core values to motivate employees by aligning them with individual values. The study is based on both a literature review and inductive research methods, emphasizing the importance of aligning the values of an organization with those of its members.

Organizations thrive when their values are shared and understood by all employees, leading to greater motivation, job satisfaction, and productivity. This research provides practical guidance for leaders, HR professionals, and stakeholders to implement strategies that integrate organizational and personal development pathways. It presents the Management by Values (MBV) model as a key strategy for improving organizational performance and employee well-being. This approach encourages organizations to act consistently with their values at all levels, fostering long-term success and a motivated workforce.

Dr Dawid Banaś
Conferences

Dr Dawid Banaś

Conference Name: VIII Międzynarodowa Konferencja Naukowa „Systemy zabezpieczenia społecznego wobec wyzwań demograficznych, ekonomicznych i technologicznych” Organizer: Zakład Ekonomiki Przedsiębiorstw, Inwestycji i Ubezpieczeń Instytutu Logistyki na Wydziale Inżynierii Zarządzania Politechniki Poznańskiej Date: 26-27 September 2024 Presentation Name: Możliwości zwiększenia skuteczności nadzoru nad rynkiem emerytalnym dzięki zastosowaniu SupTech

The pension market in Poland and worldwide is highly complex, offering numerous options for additional retirement savings. In Poland, these include Employee Pension Programs (PPE), Individual Retirement Accounts (IKE), Individual Retirement Security Accounts (IKZE), Employee Capital Plans (PPK),...

The pension market in Poland and worldwide is highly complex, offering numerous options for additional retirement savings. In Poland, these include Employee Pension Programs (PPE), Individual Retirement Accounts (IKE), Individual Retirement Security Accounts (IKZE), Employee Capital Plans (PPK), and the Pan-European Personal Pension Product (PEPP). Policymakers aim to encourage citizens to take greater responsibility for securing their financial future by creating these opportunities. However, it is important to note that individuals considering or deciding to use such products expect them to be safe, stable, and transparent. This is one reason why the state oversees the operations of financial institutions, including those operating in the pension market.

Due to limited staff, supervisory institutions (e.g., the Polish Financial Supervision Authority) are unable to analyze all data comprehensively. In response, the author of the paper highlighted the potential to enhance supervisory effectiveness by employing SupTech (Supervisory Technology).

SupTech encompasses modern technologies such as artificial intelligence, machine learning, and cloud data processing. By implementing and utilizing these technologies, data monitoring can become more efficient. It simplifies the verification of data completeness, accuracy, consistency, and reliability. Furthermore, these advanced technologies reduce human error and increase the likelihood of detecting anomalies. Automating processes saves time and financial resources, while also enabling more real-time activities.

This suggests that citizens could receive more relevant information in shorter intervals, such as updates on 12- or 24-month return rates, allowing them to make more informed decisions regarding where to allocate their funds. The author acknowledges that implementing modern technologies is costly but views it as an investment. Additionally, it would enable greater utilization of opportunities arising from technological advancements, allowing society to benefit more fully from the transformations associated with Industry 4.0 and even 5.0.

Dr hab. Piotr Idczak, prof. UEP
Conferences

Dr hab. Piotr Idczak, prof. UEP

Conference Name: RESILIENT and SUSTAINABLE ECONOMIES 2024 Organizer: Uniwersytet w Białymstoku oraz Polskie Stowarzyszenie Ekonomistów Środowiska i Zasobów Naturalnych Date: 25-28 września 2024 Presentation Name: European Digital Innovation Hubs as Catalysts for Green Transformation Actions in SMEs

European Digital Innovation Hubs as Catalysts for Green Transformation in SMEs By implementing a dual transformation (green and digital), the European economy has a real opportunity to overcome existing barriers and lay a solid foundation for generating new jobs and...

European Digital Innovation Hubs as Catalysts for Green Transformation in SMEs

By implementing a dual transformation (green and digital), the European economy has a real opportunity to overcome existing barriers and lay a solid foundation for generating new jobs and economic growth. Moreover, through structural changes, Europe can become a more sustainable and competitive economy, achieving higher levels of development. To meet these challenges, the EU has established a digital strategy aimed at providing strategic support to European enterprises on their path to transformation. Within this framework, European Digital Innovation Hubs (EDIHs) have become key entities in stimulating and accelerating dual transformation across Europe. EDIHs function as one-stop shops, helping businesses, primarily SMEs, address existing digital challenges and enhance their competitiveness through dual transformation.

The presented paper focused on analyzing the role of EDIHs as intermediaries supporting the dual transformation of businesses and public sector organizations across Europe. The primary emphasis was placed on the green transformation, highlighting how EDIHs support practices and technologies that reduce environmental impact, improve resource efficiency, and promote ecological balance.

The findings indicate that in the relationships between EDIHs and businesses or other entities, a market-driven approach dominates, with environmental considerations often treated as an additional, not necessarily equal, priority. The insufficient emphasis on “green innovations” is primarily driven by the pursuit of digital transformation, as it generates measurable economic benefits. Digitization in this process is often perceived as an end in itself rather than a tool for achieving broader goals.

One of the recommendations proposed at the decision-making level emphasizes the need to move beyond local and regional perspectives when it comes to green transformation. There is a need to establish effective networks of cooperation and connections within the EDIH framework at the European level.

Dr hab. Marta Kluzek, prof. UEP
Conferences

Dr hab. Marta Kluzek, prof. UEP

Conference Name: W poszukiwaniu racjonalnego systemu podatkowego 2024 Organizer: Wydział Ekonomiczny, Uniwersytet Marii Curie-Skłodowskiej w Lublinie Date: 17-18 October 2024 Presentation Title: Obowiązek publikowania informacji o realizowanej strategii podatkowej a unikanie opodatkowania

A tax strategy is defined as the planning of tax-related activities aimed at optimizing a company’s tax burden while complying with applicable regulations. Since 2020, businesses operating in Poland with annual revenues exceeding €50 million have been required to publish information on their...

A tax strategy is defined as the planning of tax-related activities aimed at optimizing a company’s tax burden while complying with applicable regulations. Since 2020, businesses operating in Poland with annual revenues exceeding €50 million have been required to publish information on their implemented tax strategies. The primary goal of the legislature was to increase tax transparency among taxpayers who play a significant role in the Polish market. According to the intent of the lawmakers, this mechanism was also intended to serve as an additional tool to address the problem of tax avoidance.

However, analyses indicate that the information provided by companies merely constitutes a collection of points explicitly outlined in the Corporate Income Tax Act. Companies focus on affirming compliance with the law while minimizing disclosures about actions aimed at tax optimization. This suggests that although publishing information on tax strategies was intended to reduce tax avoidance practices among large corporations, the actual impact of this tool in achieving that objective remains debatable. The lack of uniform standards and challenges in analyzing and comparing published data are the primary obstacles to fully realizing this goal.

Dr hab.inż. Daniela Gwiazdowska, prof. UEP
Conferences

Dr hab.inż. Daniela Gwiazdowska, prof. UEP

Conference Name: 6th International Conference on Biotechnology and Agriculture Engineering, Organizer: Center for Environmental Science in Saitama, Tokyo, Japan. Date: 9-11 October 2024 Presentation Title: Possibilities of using supercritical CO2 extracts from oregano as eco-friendly solution in Sustainable Agri-Food Safety Management

Ensuring food safety, protecting consumer health, and promoting animal welfare are key objectives of EU policy and the food production sectors. To prevent and control microbiological contamination at various stages of food production, a range of chemical substances is used. Agricultural practices...

Ensuring food safety, protecting consumer health, and promoting animal welfare are key objectives of EU policy and the food production sectors. To prevent and control microbiological contamination at various stages of food production, a range of chemical substances is used. Agricultural practices involve the application of fungicides, while disinfectants or preservatives are employed in the food industry. However, a significant drawback of chemical compounds is their potential to accumulate as residues in the food chain, contribute to the development of microbial resistance, and cause various adverse effects on human and animal health.

There is, therefore, a pressing need to introduce new, environmentally friendly technologies, including the extraction of antimicrobial substances. One increasingly popular method for recovering bioactive compounds is supercritical fluid extraction, which is a non-toxic, cost-effective technique widely recognized as safe (GRAS) compared to conventional extraction methods that often require higher temperatures and large amounts of organic solvents.

The research presented during the conference, titled “Possibilities of using supercritical CO2 extracts from oregano as eco-friendly solutions in Sustainable Agri-Food Safety Management,” explored the potential use of extracts from Origanum vulgare, a plant commonly found in our region, obtained through supercritical CO2 extraction. The studies demonstrated significant potential of the extracts against various groups of microorganisms. Their activity against pathogenic fungi suggests the possibility of using them as alternatives to fungicides in agriculture, while their efficacy against bacteria and biofilm formation opens the door for their use as components in disinfectants.

At the conference, Prof. D. Gwiazdowska chaired the session on Sustainable Agriculture and Agricultural Product Processing, during which various biotechnological advancements for sustainable agriculture were presented.

Co-authors: Krzysztof Juś, Katarzyna Marchwińska, Szymon Frąk, Romuald Gwiazdowski, Agnieszka Waśkiewicz

Prof. dr hab. Barbara Będowska-Sójka, Taipei
Conferences

Prof. dr hab. Barbara Będowska-Sójka, Taipei

Conference Name: 4th Yushan Conference Organizer: National Taipei University of Technology, Taipei, National Yang Ming Chiao Tung University, Hsinchu Date: December, 5-6, 2024 Presentation Title: Interaction Effects in the Cross-Section of Cryptocurrency Returns

Measurement of liquidity is a fundamental aspect of financial market analysis, enabling investors to assess the ease of executing transactions and the potential costs and risks associated with asset trading. This study focuses on the liquidity of the cryptocurrency market, which is characterized by significant fragmentation and the lack of standard metrics. Cryptocurrencies are traded on hundreds of platforms, making liquidity measurement challenging. The authors focus on the spread—the difference between bid and ask prices—as a primary liquidity indicator and attempt to forecast this spread.

Previous studies have shown ambiguous relationships between liquidity and returns. Some research suggests that less liquid cryptocurrencies might yield higher returns, but it is crucial to consider transaction costs. This study fills a gap in the literature in two key aspects.

  1. The authors describe liquidity measures (spreads) in the cryptocurrency market in an intraday framework from a time-series perspective—research of this kind has predominantly been conducted on stock markets until now. The analysis covers 15 cryptocurrency pairs from the Binance exchange, focusing on the top 5 cryptocurrencies traded against 3 leading stablecoins.
  2. The researchers introduce an innovative approach to forecasting liquidity spreads using machine learning models. A surprising finding of their study indicates that traditional models, such as OLS, can provide better forecasts than more advanced machine learning methods.

Assessing liquidity is crucial for developing robust investment strategies, as it directly impacts transaction costs and the ability to enter or exit positions without significantly affecting prices. From a market efficiency perspective, understanding liquidity dynamics helps evaluate the efficiency of cryptocurrency markets and identify potential inefficiencies.

Co-autor: Aleksander Mercik
Dr Anna Warchlewska
Conferences

Dr Anna Warchlewska

Conference Name: Konferencja Katedr Finansów 2024 Organizer: Katedra Bankowości i Rynków Finansowych, Katedra Finansów Przedsiębiorstw i Ubezpieczeń Gospodarczych oraz Katedra Finansów Publicznych Uniwersytetu Ekonomicznego w Katowicach Date: 16-17 September 2024 Presentation Title: Determinants of Consumer Financial Behaviour – Intergenerational Approach.

The topics of the conferences were consumer behavior and the difficulty of describing this issue solely within the framework of economic sciences. Consumer financial behaviors are the subject of research across many scientific disciplines, though the greatest interest in the topic is observed...

The topics of the conferences were consumer behavior and the difficulty of describing this issue solely within the framework of economic sciences. Consumer financial behaviors are the subject of research across many scientific disciplines, though the greatest interest in the topic is observed among economists, sociologists, and psychologists. Interestingly, considerations regarding consumer financial behavior have not been a distinct subject in economics so far, as the issue has been treated as one of the sectoral consumer behaviors. This has influenced the shape of theoretical models and limited their full functionality, especially in the dynamic, financial environment. Age and related generational divisions played a significant role in the analysis. According to the literature, there is an increasing emphasis on discrepancies in the boundary years of generations. Moreover, the separation of cohort effects from age effects cannot be overlooked. This raises the question of how much certain consumer behaviors are determined by a similar moment of birth versus similar age.

The emerging theoretical doubts became a starting point for the conceptualization of a model that could functionally explain consumer financial behavior in various areas, such as payment, savings, investment, credit, and many others. Based on assumptions of other researchers, a Consumer Financial Behaviour Model (CFB) was developed, based on the premise that groups of factors traditionally underlying models (e.g., economic, social) play a “secondary” role in shaping and stimulating the primary components of the model, which are: C – type of consumer, X – type of product or service, M – motivation, Cap – capabilities, and O – opportunities. The model was exemplified through a two-stage original study, with the generational category serving as the background for the empirical analysis (Stage I – CAWI survey, Stage II – IDI and FGI studies). Determinants influencing the financial behaviors of the studied generations (Silent Generation, Baby Boomers, Generation X, Y, Z, and Alpha) were verified in the areas of payments, savings-investments, and credits (excluding Generation Alpha in the credit area).

Dr hab. Anna Iwańczuk-Kaliska, prof. UEP
Conferences

Dr hab. Anna Iwańczuk-Kaliska, prof. UEP

Conference Name: Konferencja Katedr Finansów 2024 Organizer: Katedra Bankowości i Rynków Finansowych, Katedra Finansów Przedsiębiorstw i Ubezpieczeń Gospodarczych oraz Katedra Finansów Publicznych Uniwersytetu Ekonomicznego w Katowicach Data: 16-17 September 2024 Presentation Title:

The topic of cash usage in the economy is mainly studied in the context of consumer payments. However, this issue also requires consideration of how micro-enterprises use cash, not only in terms of accepting payments from customers in this form but also making cash payments to employees and...

The topic of cash usage in the economy is mainly studied in the context of consumer payments. However, this issue also requires consideration of how micro-enterprises use cash, not only in terms of accepting payments from customers in this form but also making cash payments to employees and contractors.

The aim of the conducted research was to identify internal and external factors influencing cash usage by micro-enterprises in Poland, determine the strength of influence and relationships between the factors, and establish their hierarchy. In the first stage, a literature review was conducted, which identified seven factors affecting cash usage in enterprises: small scale of operations, fees associated with cashless transactions, customer preferences, contractor preferences, delays in settling cashless transactions, lack of perceived connection between cashless payments and increased efficiency or turnover, and the perception of cashless payment technologies and procedures as complicated. Subsequently, in-depth individual interviews were conducted with owners of businesses representing micro-enterprises, which expanded the list of factors by an additional six: B2C versus B2B operations, stationary versus online operations, employee preferences, the possibility of unregistered cash transactions, industry customs, and the ability to make B2B cash payments within a limit.

In the next stage, during the second round of interviews with micro-entrepreneurs, information was collected on the relationships and strength of influence among all 13 factors. Using Interpretive Structural Modeling (ISM), the mutual relationships between factors were assessed, and their strength, dependencies, and hierarchy were determined.

The research identified the factors with the greatest influence on others but that are independent of other elements. These are: scale of operations, sales channel, and type of business. The study also identified the factors most dependent on other factors, which include: customer, contractor, and employee preferences; the perception of cashless payments as unrelated to turnover growth and as complicated; industry customs; and the possibility of unregistered cash transactions.

The results of the study show that cash usage by micro-entrepreneurs is influenced by many factors with a significant scale of impact. The most independent and influential factors are objective internal factors. Subjective internal and external factors (feelings, expectations) depend on these objective internal factors. The external (regulatory and bank pricing strategies) influence on changing the level of cash usage by micro-entrepreneurs is limited.

Dr Robert Skikiewicz
Conferences

Dr Robert Skikiewicz

Conference Name: Konferencja Katedr Finansów 2024 Organizer: Katedra Bankowości i Rynków Finansowych, Katedra Finansów Przedsiębiorstw i Ubezpieczeń Gospodarczych oraz Katedra Finansów Publicznych Uniwersytetu Ekonomicznego w Katowicach Date: September 16-17, 2024 Presentation Title: Determinants of the Degree of Commercialization of Social Enterprises in Poland

The paper identifies the level of commercialization of social enterprises in Poland. It also attempts to assess the relationship between the level of commercialization of social enterprises and their selected characteristics. The level of commercialization was determined based on the share...

The paper identifies the level of commercialization of social enterprises in Poland. It also attempts to assess the relationship between the level of commercialization of social enterprises and their selected characteristics.

The level of commercialization was determined based on the share of revenues from economic activity in the total revenues of social enterprises. A literature review established that the level of commercialization of social enterprises may be influenced by their characteristics related to size (number of employees employed under employment contracts, total revenues of the organization), legal form of operation, and variables associated with the specifics of their business activities (main area of economic activity, the market where the organization primarily operates, and the extent of online activity). This set was supplemented by two additional features – the organization’s headquarters and the year operations began.

The issues addressed in the paper were verified using empirical data obtained from a survey conducted in 2023 on a representative sample of 585 social enterprises in Poland. To assess the relationships between variables, the chi-square independence test, Spearman’s rank correlation analysis, and ordinal regression were applied.

Social enterprises exhibit significant differences in their level of commercialization. On one hand, nearly every fourth social enterprise (23.1%) has a low level of commercialization, achieving no more than 10% of its revenue from economic activity. On the other hand, almost every fifth social enterprise (18.8%) demonstrates full commercialization, obtaining 100% of its revenue from economic activity.

The conducted analyses allow for conclusions regarding the relationship between selected characteristics of social enterprises and their level of commercialization. A relationship between the legal form of activity and the share of revenues from economic activity was confirmed. Additionally, the analyses showed that only one variable related to the size of the social enterprise (total revenues of the organization) exhibits a statistically significant relationship with the variable determining the level of commercialization. Among the remaining analyzed characteristics of social enterprises, two additional variables were identified as related to the share of revenues from economic activity. These are: the year operations began and the extent of online business activity.

The relationship between the remaining characteristics of social enterprises analyzed in the paper and the level of commercialization was not confirmed.

Co-author: Paweł Mikołajczak

Dr Katarzyna Schmidt-Jessa
Conferences

Dr Katarzyna Schmidt-Jessa

Conference Name: 1st Modern Finance Conference Organizer: Modern Finance Institute, Akademia Leona Koźmińskiego w Warszawie Date: 15-17 September 2024 Presentation Title: Macro approach to profit shifting: methods and challenges of re-estimation

The shifting of profits, involving the transfer of earnings by multinational enterprises from high-tax countries to jurisdictions perceived as tax havens, has been the subject of numerous studies for years. Each country’s goal is to implement appropriate regulations that seal the system and...

The shifting of profits, involving the transfer of earnings by multinational enterprises from high-tax countries to jurisdictions perceived as tax havens, has been the subject of numerous studies for years. Each country’s goal is to implement appropriate regulations that seal the system and minimize tax losses resulting from profit shifting. Therefore, it raises the question of which countries are most frequently used for profit shifting and what factors influence this phenomenon. In our study, we aim to answer these questions.

By analyzing the balance of payments of 96 economies worldwide, we estimate the scale of profit shifting across countries over the years 2009–2021. Our results indicate that the countries with the highest values of profit shifted out are Mali, Mozambique, Lithuania, and Nepal, while the countries with the lowest values are Chile, Bosnia and Herzegovina, Slovakia, and Macedonia. At the same time, on a global scale, two trends are noticeable: an increasing trend in developing economies and a declining trend in developed economies.

Significant differences in the values of shifted profits between economies, as well as the diversity among the analyzed economies, led us to search for common characteristics — macro-level determinants that significantly influence profit shifting values. In our study, we analyzed economic factors (such as GDP, inflation, and exports), regulatory and tax-related factors (CIT rates, transfer pricing regulations, and thin capitalization rules), governance-related factors (regulatory quality, control of corruption, etc.), and socio-cultural factors (e.g., religion). In total, we examined 27 different factors, proving statistical significance for 14 of them.

The most important determinants with a significant negative impact on profit shifting include GDP growth, country classification, Country-by-Country Reporting, and Islam as the dominant religion. The key factors with a positive impact, meaning those that increase the value of shifted profits relative to GDP, include membership in the group of low-income countries, a higher share of trade in GDP, and the presence of thin capitalization rules.

Co-authors: Dr. hab. Katarzyna Perez, Prof. of UEP; Dr. Tomasz Kaczmarek

Mgr Mateusz Skwarek
Conferences

Mgr Mateusz Skwarek

Conference Name: 1st Modern Finance Conference Organizer: Modern Finance Institute; Kozminski University Date: 15-17 September 2024 Presentation Title: The effect of behavioural factors on the dynamics of Bitcoin market efficiency

Motivated Institutional Investors and Bank Debt Financing The efficiency of the financial market can be understood in various ways. One of these is informational efficiency, which means that information about investment assets is immediately made publicly available and...

Motivated Institutional Investors and Bank Debt Financing

The efficiency of the financial market can be understood in various ways. One of these is informational efficiency, which means that information about investment assets is immediately made publicly available and reflected in their prices. Specifically, in an efficient market, most investors correctly assess the impact of a given piece of information on the value of an investment asset. This should result in financial asset prices reflecting their actual value. However, in reality, the level of market efficiency changes over time, which may be linked to the emergence of unexpected information and the influence of emotions on investor behavior. Emotions belong to the so-called behavioral factors (factors affecting investor behavior). Therefore, the less informationally efficient a market is, the more asset prices deviate from their actual value, which may be related to the presence of behavioral factors.

The aim of this article is to examine the impact of behavioral factors in investment decision-making on the dynamics of Bitcoin market efficiency. The dynamics of market efficiency have been studied in the context of various investment assets. One of these is cryptocurrencies, whose popularity has grown in recent years. The largest cryptocurrency in terms of market capitalization is Bitcoin. Previous studies confirm that the returns achieved in the Bitcoin market are related to behavioral factors — investor sentiment, investor attention directed toward Bitcoin, and loss aversion. It can thus be concluded that participants in the Bitcoin market are guided by behavioral factors when making investment decisions. However, to date, the relationship between behavioral factors and the dynamics of Bitcoin market efficiency has not been confirmed.

The results of the study indicate that investor sentiment and liquidity levels in the Bitcoin market are positively related to the dynamics of Bitcoin market efficiency. The research shows that the faster transactions are executed in the Bitcoin market, the quicker new information can be reflected in its price. The results also indicate that during periods of negative sentiment, investors in the Bitcoin market may be more inclined to hold onto Bitcoin in their investment portfolios, even as its value potentially declines. The reason for such behavior could be a desire to “recover” losses previously incurred.

Therefore, the conducted study highlights how investor emotions can be a source of inefficiency in the Bitcoin market.

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