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Replication Data for: Revisiting the Risks of Bitcoin Currency Exchange Closure

Harvard Dataverse (Africa Rice Center, Bioversity International, CCAFS, CIAT, IFPRI, IRRI and WorldFish)

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Title Replication Data for: Revisiting the Risks of Bitcoin Currency Exchange Closure
 
Identifier https://doi.org/10.7910/DVN/7ROIBN
 
Creator Moore, Tyler
 
Publisher Harvard Dataverse
 
Description Bitcoin has enjoyed wider adoption than any
previous cryptocurrency; yet its success has also attracted
the attention of fraudsters who have taken advantage of operational
insecurity and transaction irreversibility. We study the risk
investors face from the closure of Bitcoin exchanges, which convert
between Bitcoins and hard currency. We examine the track record of
80~Bitcoin exchanges established between 2010 and 2015. We find
that nearly half (38) have since closed, with customer account balances sometimes wiped out. Fraudsters are sometimes to blame, but not always. 25 exchanges
suffered security breaches, 15 of which subsequently closed. We
present logistic regressions using using longitudinal data on Bitcoin
exchanges aggregated quarterly. We find that experiencing a breach is
correlated with a 13-times greater odds that an exchange will close in
that same quarter. We find that higher-volume exchanges are less
likely to close (each doubling in trade volume corresponds to a 12
percent decrease in the odds of closure). We also find that exchanges who derive most of their business from trading less popular (fiat) currencies, which are
offered by at most one competitor, are less likely to close.
 
Subject Computer and Information Science
 
Contributor Moore, Tyler