The Crypto Shocks and Retail Losses

The bulletin complements a working paper they published in November 2022 on crypto trading and Bitcoin prices. Prices rose rapidly until November 2021 when they peaked and then they collapsed in 2022, particularly after the Terra Luna collapse and the FDX bankruptcy. We wanted to know about three issues: how small retail investors traded during this episode compared to large or insider investors. Second, based on a simulated investment strategy, whether they made money or lost money. Third, whether this market turmoil had any spillover effects into traditional financial markets.