(The) business impact of cryptocurrency

Abstract

Cryptocurrencies such as Bitcoin, Ethereum, and Ripple are well known to technology enthusiasts and even to the general public. Bitcoin is the best known and it has been well known to the public since the second half of 2017. Although global enterprises such as Starbucks, Amazon, and Tesla are planning to accept Bitcoin as a payment method in line with this trend, an empirical evidence stating the business impact of cryptocurrency is largely lacking. This research investigates how Bitcoin acceptance affects the online-performance of retailers by exploiting panel data on Bitcoin receivers and their online reviews. This paper demonstrates the number of retailer's monthly reviews who have accepted Bitcoin increases roughly 3.6% since the cryptocurrency has been popular to the public. Moreover, the price of Bitcoin positively moderates the amount of reviews whereas the transaction fees of Bitcoin negatively moderate the dependent variable. In addition, through sentiment analysis, this paper also shows that there has been a significant increase in positive sentiment of reviewers. These findings contribute to the growing and controversial literature related to cryptocurrency by showing how Bitcoin affects the real business. Practically, entrepreneurs are able to utilize the results to decide whether to accept Bitcoin as a new payment system.