Social media discussions play a crucial role in influencing crypto returns: Study

What they found may stand in stark contrast to associated financial markets.According to the groups research paper, social media plays an outsized role in adoption and activity rates, while cryptocurrency journalism isnt a terrific predictor of market movement:”Our findings show that social media sentiment significantly anticipates crypto returns, while belief from news media does not.”The researchers used natural language processing to evaluate millions of monetary news articles and social media remarks and produced sentiment scores along 53 topics and attention metrics for over 300 cryptocurrencies.They then compared the ground truth returns over a given duration of time to the coinciding news and social media sentiment. Source: “An Anatomy of Cryptocurrency Sentiment”Perhaps most intriguing among their findings is their conclusion that while social media sentiment is a great predictor of crypto returns, the threat premium channel is not.