Thomson Reuters Unveils Bitcoin Chatter Gauge

As cryptocurrencies fuel discussions on forums and news websites, a new version of a Thomson Reuters Corp tool will capture online chatter around bitcoin. MarketPsych Indices will scan more than 400 websites to analyze bitcoin themes and sentiments, Reuters reported.

Traders have long analyzed online chatter around traditional investments, and that trend continues with bitcoin, which Reuters will analyze in the tool it runs with MarketPsych Data LLC.

Austin Burkett, global head of Quant and Feeds at Thomson Reuters, said, “News and social media are driving the investment and risk management process more than ever with the continuing rise of passive and quant-driven trading.”

For example, analysts have connected the frequency of Google searches for “bitcoin” with the current price of bitcoin. As bitcoin slid over the past few months, searches for “bitcoin” on Google declined, Bloomberg reported. According to Google’s data, searches for the term have plummeted by 80 percent since the cryptocurrency’s high in Dec. 2017.

Last Thursday (March 8), bitcoin slid again by 7 percent over a 24-hour period as regulators cracked down on cryptocurrency exchanges. Following a high earlier in the week, the cryptocurrency tumbled more than 15 percent, CNBC reported.

The fall came as Japan’s Financial Services Agency (FSA) stopped trading on Thursday at the Bit Station and FSHO crypto exchanges for one month. The FSA said a Bit Station manager had used bitcoin from customers for his or her own purposes, according to a translation and wire reports.

The price dip also followed concerns at the Hong Kong-based Binance exchange, where customers might have fallen victim to phishing through their accounts: “The [application programming interface] for the exchange malfunctioned and sent sell orders into the market,” Brian Kelly, head of BKCM, told CNBC.

The recent declines also came as the U.S. Securities and Exchange Commission (SEC) said several online trading platforms should be registered with the SEC itself.