Investigating the Interaction Between Bitcoin’s Price and Selected Stock Indices: An Application for Borsa Istanbul

Abstract

In the study, the interaction of Bitcoin, which stands out among the cryptocurrencies which are among the major financial technologies, with the BIST Technology (XUTEK), BIST Informatics (XBLSM), BIST Corporate Governance (XKURY), BIST Sustainability (XUSRD), and BIST100 (XU100) indices during the period from 2018 to 2022 was investigated. Daily data were utilized, and correlation and linear regression analyses were conducted. It was found that Bitcoin had a positive impact on all selected stock indices during the 2018-2022 period. Additionally, in the year-by-year analyses, it was found that Bitcoin had a positive impact on all selected stock indices in 2018, 2020, and 2021; had a negative impact on them in 2022; and had a negative impact on the BIST Technology and BIST Corporate Governance indices in 2019. According to the findings of the study, stock market investors generally perceive that Bitcoin is associated with the firms within the relevant indices. Investors mostly interpret this association as positive and make investment decisions accordingly. However, in certain years, the assessments of investors indicate a negative relationship.