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New Study by Sridharan, Mansour, Ray Tackles Bitcoin Usage

A new study by Turner College faculty Uma Sridharan, Fady Mansour, Lydia Ray and University of North Florida management professor Tobias Huning investigates the effect of risk tolerance on the decision to use Bitcoin in making payments and receiving compensation.  They collected survey data from 225 respondents to measure risk attitudes and the choice to use Bitcoin.  Two measures of risk are employed – the general risk-taking propensity scale (GRiPS) and the risk-taking index (RTI).  Analysis of the survey data reveals that individuals who chose to receive payment in Bitcoin show a significantly greater risk propensity for both GRiPS and RTI.  According to one model specification discussed in the study, individuals with the lowest risk-taking propensity exhibit a 17% to 36% probability of accepting payment in Bitcoin, compared to a range of 57% to 68% for individuals with the highest risk-taking propensity.  Interestingly, the results suggest that the choice to make payment using Bitcoin is unrelated to risk-taking propensity.  The study is set to appear in the July 2023 issue of the Journal of Financial Economic Policy.  “For future research, we plan to incorporate various macroeconomic trends to estimate the effect of risk attitude on adopting different kinds of cryptocurrencies, conditional on the macroeconomic environment and business cycle,” Sridharan indicated to Turner Business.

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