This study looks at the price mechanism of the digital quasi-currency bitcoin. Through statistical analysis of secondary data a probable significant results regarding correlation and regression between price and different independent variables have been established. The final analysis is pointing towards network effects being a part of the determinants for the cryptocurrency’s price.

Complimentary to the quantitative study explained in this paper, an implementation of hermeneutic analysis based on secondary theoretical sources, journalistic opinion and a professional qualified judgement has aided the author and study in conceptual understanding.

This interpretation has semantic character, and takes a Socratic kickoff regarding the nature of bitcoin as a financial instrument and the issues surrounding its price. The analysis runs back and forth throughout the course of the study and finally intertwines with qualitative results in the discussion. It is the author’s impression that a significant dimorphism surrounds bitcoin, calling for a conceptual differentiation leading to practical rethinking.

The study takes the shape of a case-study conducted over four months. The author’s location during the process of writing was Stockholm Sweden, but the gathered data is of transnational character.

To find out more about whether or not the price of Bitcoin is really as it seems, access this free paper.