Abstract

Cryptocurrencies, especially Bitcoin, have been used very often recently. The need for analyzing the price movements of the cryptocurrencies, which are accepted as “a currency” and “a store of value”, has emerged. With the growth and global integration of these markets, whether there are speculative bubbles on the basis of significant changes in prices is important in terms of openness and security in respect of financial stability. In addition, speculative movements in the cryptocurrencies market raise the question of whether market participants act with herd mentality. For this reason, in the study, the presence of speculative bubbles in Bitcoin and Etherium is analyzed by using Philips et al. (2015) method and estimated when they were formed. While the presence of bubbles in the cryptocurrencies market and the existence of these bubbles as a duration of herd mentality, it is also known that there is no balancing speculation in this market. According to the findings, a large number of bubbles were found in the Bitcoin and Etherium cryptocurrencies. The emergence of large bubbles, especially between the years 2017-2018, has shown that these cryptocurrencies are prone to speculative movements.