Social Media Attention, Investor Sentiment, and Cryptocurrency Prices: A Literature Review of Determinants and Modeling Approaches

The cryptocurrency market is constantly growing, both in value and in the number of participants. While the technology and the market are maturing, the determinants that may help better predict future price movements are not fully understood and at times contradictory. This paper fills this gap by conducting a literature review that focuses on online and social media indicators to predict cryptocurrency prices. We find that the suitability of indicators varies between social networks and between different types of cryptocurrencies. The evidence suggests that online investor sentiment and attention, as well as financial market activity at large, appear to correlate with price changes and improve prediction results to some extent.