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<p>This paper examines the relationship between economic policy uncertainty (EPU) and trading activity in cryptocurrency markets, focusing on Bitcoin (BTC), Ether (ETH), and Ripple (XRP) over the period 2016–2025. Unlike most of the literature, which emphasizes prices and returns, we adopt a behavioural perspective by using trading volumes as a proxy for market participation. The empirical analysis relies on lag-augmented local projections (LP) to estimate the dynamic effects of persistent uncertainty shocks, using both the Global Economic Policy Uncertainty (GEPU) index and the European News-Based Uncertainty Index (ENBI). The results show a positive and statistically significant relationship between uncertainty and crypto trading volumes, particularly when accounting for structural breaks. In the period before the Market in Crypto Asset (MiCA) regulation has been adopted, a one standard deviation increase in uncertainty leads to substantial increases in trading activity across cryptocurrencies, with especially strong effects for Ripple. Additional evidence based on returns suggests that this pattern reflects speculative behaviour rather than panic-driven selling. The findings contrast with traditional financial markets and indicate that economic policy uncertainty acts as a catalyst for trading intensity in cryptocurrency markets.</p>

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Uncertainty shocks and trading intensity of cryptocurrencies

  • 期刊论文

  • 发表日期：

    2026年6月23日

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  • Chiara Oldani,
  • Giovanni S. F. Bruno,
  • Marcello Signorelli

摘要

This paper examines the relationship between economic policy uncertainty (EPU) and trading activity in cryptocurrency markets, focusing on Bitcoin (BTC), Ether (ETH), and Ripple (XRP) over the period 2016–2025. Unlike most of the literature, which emphasizes prices and returns, we adopt a behavioural perspective by using trading volumes as a proxy for market participation. The empirical analysis relies on lag-augmented local projections (LP) to estimate the dynamic effects of persistent uncertainty shocks, using both the Global Economic Policy Uncertainty (GEPU) index and the European News-Based Uncertainty Index (ENBI). The results show a positive and statistically significant relationship between uncertainty and crypto trading volumes, particularly when accounting for structural breaks. In the period before the Market in Crypto Asset (MiCA) regulation has been adopted, a one standard deviation increase in uncertainty leads to substantial increases in trading activity across cryptocurrencies, with especially strong effects for Ripple. Additional evidence based on returns suggests that this pattern reflects speculative behaviour rather than panic-driven selling. The findings contrast with traditional financial markets and indicate that economic policy uncertainty acts as a catalyst for trading intensity in cryptocurrency markets.