Sidechain and volatility of cryptocurrencies based on the blockchain technology

Olivier Hueber

Université Côte d’Azur, CNRS-GREDEG; France; olivier.hueber@univ-cotedazur.fr

Abstract

A cryptocurrency market based on the blockchain technology is characterized by the coexistence of a steady-state supply and a volatile e-money’s demand. In this study a cointegration test establishes a long-run relationship between the internal demand of Bitcoins and prices. From this result, we propose to restrain the intrinsic volatility of any cryptocurrency based on the Blockchain technology by introducing a sidechain pegged to the parent chain.

Keywords

Sidechain, Community currencies, Blockchain, Bitcoin, Demurrage, cryptocurrencies

Article Hueber

To cite this article: Hueber, O. (2019) ‘Sidechain and volatility of cryptocurrencies based on the blockchain technology’ International Journal of Community Currency Research 23 Issue 2 (Summer 2019) 35-44; http://www.ijccr.net; ISSN 1325-9547; DOI http://dx.doi.org/10.15133/j.ijccr.2019.012

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