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<p>The growth of payment platforms driven by the demand for flexible, simple, and quick transactions among customers is evident as technology advances. The emergence of decentralized digital currencies, such as cryptocurrencies, and the underlying Blockchain technology has disrupted traditional finance, attracting both institutional and individual investors. This research aims to analyze the complex interplay of cryptocurrency investments, market dynamics, and investor behavior by examining factors like technological innovation, regulatory environment, and market volatility, and by considering dependent variables such as Return on Investment (ROI), Risk Exposure, and Investor Sentiment. In a cross-sectional exploratory design, the study utilized a random and convenient selection strategy, which enabled respondents of the mailed questionnaire to easily select 590 from 700 sent. With such an expansive and diverse respondent pool, it can be concluded confidently, especially under the lens of assessing the moderating effect of market maturity and the mediating role of investor knowledge on investment behavior. The quantitative analysis involved a 5-point Likert scale questionnaire with 40 items and applied statistical techniques such as t-tests, ANOVA, and matrix analysis for comprehensive examination and hypothesis testing. The analysis provides a high correlation between market volatility and returns regarding investments in the cryptocurrency market, which is evident in the sharp price fluctuation of Bitcoin, which rose to more than 63,000 and dropped below 20,000 in 2022, after a significant change in price in January 2020 to approximately 7200 dollars. Also, suggesting that higher market maturity moderates the impact of volatility on returns in line with the Efficient Market Theory (EMT). Furthermore, the findings indicate significant relationships between market volatility and risk exposure, as well as between investor knowledge and risk exposure, challenging traditional assumptions about the relationship between expertise and risk tolerance. Additionally, the positive coefficient for technological innovation in the regression model supports Schumpeter’s theory, suggesting that rising levels of innovation are linked to increasing investment returns, particularly in nascent markets like cryptocurrencies.</p>

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Cryptocurrency investments: an empirical analysis of risk and return trends in the contemporary financial landscape

  • 期刊论文

  • 发表日期：

    2025年8月13日

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  • A. Jagdish Mohan Rao,
  • K. G. K. Patnaik,
  • P. Srinivas,
  • M. V. K. Srinivas Rao,
  • A. V. N. Murty

摘要

The growth of payment platforms driven by the demand for flexible, simple, and quick transactions among customers is evident as technology advances. The emergence of decentralized digital currencies, such as cryptocurrencies, and the underlying Blockchain technology has disrupted traditional finance, attracting both institutional and individual investors. This research aims to analyze the complex interplay of cryptocurrency investments, market dynamics, and investor behavior by examining factors like technological innovation, regulatory environment, and market volatility, and by considering dependent variables such as Return on Investment (ROI), Risk Exposure, and Investor Sentiment. In a cross-sectional exploratory design, the study utilized a random and convenient selection strategy, which enabled respondents of the mailed questionnaire to easily select 590 from 700 sent. With such an expansive and diverse respondent pool, it can be concluded confidently, especially under the lens of assessing the moderating effect of market maturity and the mediating role of investor knowledge on investment behavior. The quantitative analysis involved a 5-point Likert scale questionnaire with 40 items and applied statistical techniques such as t-tests, ANOVA, and matrix analysis for comprehensive examination and hypothesis testing. The analysis provides a high correlation between market volatility and returns regarding investments in the cryptocurrency market, which is evident in the sharp price fluctuation of Bitcoin, which rose to more than 63,000 and dropped below 20,000 in 2022, after a significant change in price in January 2020 to approximately 7200 dollars. Also, suggesting that higher market maturity moderates the impact of volatility on returns in line with the Efficient Market Theory (EMT). Furthermore, the findings indicate significant relationships between market volatility and risk exposure, as well as between investor knowledge and risk exposure, challenging traditional assumptions about the relationship between expertise and risk tolerance. Additionally, the positive coefficient for technological innovation in the regression model supports Schumpeter’s theory, suggesting that rising levels of innovation are linked to increasing investment returns, particularly in nascent markets like cryptocurrencies.