How brain function affects the ups and downs of bitcoin
The cost of bitcoin is a changeable thing. Two years ago, at about the same period, the price of the coin rose to a record $ 1,242, but three years ago it was $ 12. Having reached the peak, the price almost immediately began to decline, and to this day the virtual currency could not beat its previous records. Coin prices are still in the range of 200-450 dollars per unit.
Each new turn in the cost curve provokes a heightened sense of anxiety in a large part of the Bitcoin community, since the next jump can destroy their states in a fraction of a second. Following the fluctuations in the course invariably followed heated discussions about the causes of what is happening. Shadow Ponzi schemes? Manipulations of stock magnates? Large investment injections? The answers to these questions, oddly enough, can be found in our heads with you, because the response of certain neurons that light up like Christmas tree lights correspond to each fluctuation in the cost of Bitcoin.
Scientists have conducted a gigantic research work, analyzing the effects of market fluctuations on the human brain and vice versa. Market behavior is the result of collective decision making by players, and decision making is in the field of psychology - therefore, the human brain is responsible for this process. As well as the stock price, the bitcoin price depends on the collective decisions made by the community.
According to neuroeconomist Gregory Burns, information and expectations are key concepts in analyzing the relationship between neural activity and market behavior.
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Expectations are formed from the received information, and in accordance with the formed expectations (the coming “native” or collapse of the course) the brain area called neostriatum passes to action. Neostriatum or striatum is responsible for making decisions, and also has the most extensive network of dopamine receptors, compared to other parts of the brain.
Neurology is able to shed light on the famous peaks and falls of Bitcoin. The number of regular Bitcoin users is still relatively small, and is comparable to the number of players on a single stock exchange. This statement is true, despite the fact that automated trading bots for selling and buying bitcoins, undoubtedly exist and, according to Andrew Barisser, owner of Bitcoin-based company Assembly , which released its own trading bot earlier this year, are popular on some exchanges.
In the Bitcoin community, the information flow is not too thick ( we should know - we are writing news about it!), Therefore, every new fact has the potential to have a serious impact on the formation of user expectations, Burns believes, because of the history of previous bitcoin fluctuations and the reaction of traders, we can conclude that people cling to every detail, hoping to predict the near future, whether this detail is essential or not. Having learned the latest news about investment injections in the bitcoin industry, scandal or hacker attack, the strider trader comes into activity, and if the news is optimistic, this area of the brain produces a huge amount of dopamine. In this case, the scale reflecting the change in the level of dopamine will strongly resemble the growth curve of the virtual coin.
However, the key concept in each individual case is expectations: optimistic or negative news can have a tremendous impact on the minds of network participants if they already have a certain amount of user expectations. If any terrible events occur in the world of Bitcoin, the price immediately breaks through the lower threshold, but this news may seem positive to someone. Anyone who can fall, is able to rise. This may seem absurd, but this is how the human brain works.
All these processes sometimes defy logical explanation, but the modern economy has long abandoned the rational man's hypothesis: people do not always act logically when it comes to money - or bitcoins
a source
We at Hashflare are not trying to guess on the Bitcoin course, but simply believe in it - and the offers to join you: start mining bitcoins at our facilities today, if you haven’t done it before:
Each new turn in the cost curve provokes a heightened sense of anxiety in a large part of the Bitcoin community, since the next jump can destroy their states in a fraction of a second. Following the fluctuations in the course invariably followed heated discussions about the causes of what is happening. Shadow Ponzi schemes? Manipulations of stock magnates? Large investment injections? The answers to these questions, oddly enough, can be found in our heads with you, because the response of certain neurons that light up like Christmas tree lights correspond to each fluctuation in the cost of Bitcoin.
All in my head
Scientists have conducted a gigantic research work, analyzing the effects of market fluctuations on the human brain and vice versa. Market behavior is the result of collective decision making by players, and decision making is in the field of psychology - therefore, the human brain is responsible for this process. As well as the stock price, the bitcoin price depends on the collective decisions made by the community.
According to neuroeconomist Gregory Burns, information and expectations are key concepts in analyzing the relationship between neural activity and market behavior.
')
Everything in my head, data about specific facts, data about the risks that we collect - akin to eavesdropping. If we assume that a certain area of the brain is responsible for collecting information from other brain centers and its processing, it can be called a kind of barometer of user expectations. This area can be studied and even assumed, with high probability, the subsequent actions of its owner.
- Gregory Burns, neuroeconomist, director of the Neuro Policy Center at Emory University
Expectations are formed from the received information, and in accordance with the formed expectations (the coming “native” or collapse of the course) the brain area called neostriatum passes to action. Neostriatum or striatum is responsible for making decisions, and also has the most extensive network of dopamine receptors, compared to other parts of the brain.
Neurology is able to shed light on the famous peaks and falls of Bitcoin. The number of regular Bitcoin users is still relatively small, and is comparable to the number of players on a single stock exchange. This statement is true, despite the fact that automated trading bots for selling and buying bitcoins, undoubtedly exist and, according to Andrew Barisser, owner of Bitcoin-based company Assembly , which released its own trading bot earlier this year, are popular on some exchanges.
The smaller the market, or another part of the community, in which decision making is the determining process, the more results the study of the psychological background of events can bring.
- Gregory Burns
In the Bitcoin community, the information flow is not too thick ( we should know - we are writing news about it!), Therefore, every new fact has the potential to have a serious impact on the formation of user expectations, Burns believes, because of the history of previous bitcoin fluctuations and the reaction of traders, we can conclude that people cling to every detail, hoping to predict the near future, whether this detail is essential or not. Having learned the latest news about investment injections in the bitcoin industry, scandal or hacker attack, the strider trader comes into activity, and if the news is optimistic, this area of the brain produces a huge amount of dopamine. In this case, the scale reflecting the change in the level of dopamine will strongly resemble the growth curve of the virtual coin.
However, the key concept in each individual case is expectations: optimistic or negative news can have a tremendous impact on the minds of network participants if they already have a certain amount of user expectations. If any terrible events occur in the world of Bitcoin, the price immediately breaks through the lower threshold, but this news may seem positive to someone. Anyone who can fall, is able to rise. This may seem absurd, but this is how the human brain works.
All these processes sometimes defy logical explanation, but the modern economy has long abandoned the rational man's hypothesis: people do not always act logically when it comes to money - or bitcoins
a source
We at Hashflare are not trying to guess on the Bitcoin course, but simply believe in it - and the offers to join you: start mining bitcoins at our facilities today, if you haven’t done it before:
Source: https://habr.com/ru/post/367343/
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