@inproceedings{c518e6d0d2294fb983eef398bacb394f,
title = "Do Inflation Expectations Drive Cryptocurrency Investments?",
abstract = "This extended abstract summarizes the essence of [1], which uses proprietary data from a predominant cryptocurrency exchange in India and the country{\textquoteright}s Household Inflation Expectations Survey to document a significantly positive association between inflation expectations and individual cryptocurrency purchases. The authors find that the effect is concentrated in Bitcoin (BTC) and Tether (USDT) trading, and is robust after controlling for speculative demand captured by surveys of investors{\textquoteright} expected cryptocurrency returns. They also find that higher inflation expectations are associated with more new cryptocurrency investors. These results have causal interpretations as confirmed by instrumental variables. The findings of [1] provide direct evidence that households already adopt cryptocurrencies for inflation hedging, which in turn rationalizes their high adoption in developing countries without a globally dominant currency.",
keywords = "Bitcoin, Cryptocurrency, Household Finance, Inflation, Stablecoin",
author = "Will Cong and Pulak Ghosh and Jiasun Li and Qihong Ruan and Artem Streltsov",
note = "Publisher Copyright: {\textcopyright} Will Cong, Pulak Ghosh, Jiasun Li, Qihong Ruan, and Artem Streltsov;; 7th Conference on Advances in Financial Technologies, AFT 2025 ; Conference date: 08-10-2025 Through 10-10-2025",
year = "2025",
month = oct,
day = "6",
doi = "10.4230/LIPIcs.AFT.2025.10",
language = "English",
series = "Leibniz International Proceedings in Informatics, LIPIcs",
publisher = "Schloss Dagstuhl- Leibniz-Zentrum fur Informatik GmbH, Dagstuhl Publishing",
editor = "Zeta Avarikioti and Nicolas Christin",
booktitle = "7th Conference on Advances in Financial Technologies, AFT 2025",
}