This study investigates the dynamic connectedness within the cryptocurrency market by analyzing four distinct cryptomarket blocks: Bitcoin and Ethereum (conventional cryptocurrencies); PAXG, DGX, and GLC (gold-backed cryptocurrencies); LINK and MNK (decentralized finance); and THETA and MANA (nonfungible tokens). Using the time-varying parameter quantile vector autoregressive (TVP-Quantile VAR) model for the period 2019–2023, our analysis reveals significant insights into the risk transmission dynamics among cryptocurrencies. Both conventional cryptocurrencies exhibit a consistent net transmitter effect in extreme periods, whereas decentralized finance (DeFi) and nonfungible tokens (NFTs) shift between a net shock transmitter and a net shock receiver over time and quantiles. Moreover, our results shed light on the hedging and safe haven properties of these assets. By linking the dynamic connectedness findings with established literature on hedging and safe haven functions, we elucidate how these cryptocurrencies perform under varying market conditions. Specifically, we report that the role of LINK, MNK, THETA, and MANA as reliable safe-haven assets is contingent upon the observed period. We also observe the hedge and safe haven properties of selected gold-backed cryptocurrencies within the network. Overall, our findings suggest that, despite the dynamic connectedness of the cryptocurrency market, investors have the flexibility to diversify across these digital assets.

Precious metals have become a critical component of investment portfolios for both individual and institutional investors. A key question is whether integrating extracted and recycled precious metals into equity portfolios can simultaneously enhance financial performance and reduce carbon emissions. Using Minimum Variance Portfolio (MVP) model alongside life cycle assessment (LCA) data from peer-reviewed studies, mining industry sustainability reports, and research institutes to evaluate the carbon intensity of these metals over a 26-year period (1999–2024). The findings show that all four precious metals serve as effective financial diversifiers during market turmoil, while also mitigating portfolio carbon intensity over time. Extracted metals initially exhibit higher CO2 emissions than the S&P 500, but they reduce portfolio carbon intensity over time. Extracted gold emerges as the most effective short-term carbon diversifier (5.4 years), followed by extracted silver (6.22 years), whereas platinum and palladium require longer holding period (22 and 16 years, respectively). Nevertheless, all four recycled precious metals provide immediate and substantial emission reductions, with recycled gold offering the most significant carbon efficiency benefits. Furthermore, multi-extracted metal portfolio outperforms single-extracted metal allocations in terms of carbon efficiency. These results offer critical insights for climate-conscious investors seeking alignment with decarbonization and net-zero goals.

Rising global crises and heightened market uncertainty have elevated the role of safe-haven assets in portfolio stabilization. This paper focuses on four major safe-haven assets, namely, Bitcoin, Gold, JPY.USD, and CHF.USD and investigates the direction and the extent to which information transmission among the four assets changes over time. Using the DCC-GARCH R^2 decomposed connectedness framework, We uncover marked heterogeneity and regime dependence in shock transmission: Bitcoin persistently functions as the primary net receiver, Gold, JPY.USD and CHF.USD switch between receiver and transmitter roles contingent on market conditions. The information embedded in the connectedness analysis is then used to construct two minimum-connectedness portfolios (bivariate and multivariate) designed to minimize bilateral and system-wide shock transmission. Based on our results, the two connectedness-based portfolios show superior in-sample risk-adjusted performance compared to conventional minimum-variance, minimum-correlation, and static hedging benchmarks in terms of risk-adjusted return and hedging effectiveness. Strikingly, whereas variance-minimizing strategies marginalize Bitcoin, connectedness-based portfolios assign it substantial weight, confirming its significant contribution to portfolio diversification within the examined network. This result also underscores the limitations of static covariance-based approaches for resilient portfolio construction in volatile markets. Overall, our findings carry direct implications for investors pursuing robust risk-adjusted performance across market regimes and for policymakers tasked with monitoring evolving systemic risk transmission among safe-haven assets.

The purpose of this study is to provide empirical evidence on the economic effectiveness of government measures in response to the COVID-19 crisis in OECD countries. We use the likelihood ratio panel probit model for 30 OECD countries with a monthly frequency from January 2020 to March 2021. We study the response of the interest rate, unemployment rate, and total industry output index to different types of government actions, including the economic support index, workplace closures, and public transportation shutdown, among others. The results show that the measures taken by governments to combat COVID-19, while saving lives, are not as effective as hoped in supporting the economy. The results highlight that economic support measures fail to reduce unemployment while preventing a free fall in the interest rate and the industrial production index. We conclude that a local industrial strategy is a starting point for addressing inequality and rebuilding a labour market more resilient to future crisis. Thinking holistically about smart industrial policies, capable of reallocating resources to specific key sectors (such as healthcare), will contribute to long-term economic resilience and growth, as well as creating conditions for sustainability.

This study examines the dynamic interconnectedness between digital and traditional assets, with an emphasis on fiat currencies (such as JPY/USD and CHF/USD), cryptocurrencies (such as Bitcoin), and digital assets backed by gold (such as Tether Gold and Digix Gold Token) under various economic conditions. The study uses sophisticated techniques, including dynamic connectedness, quantile connectedness, and time-frequency connectedness analyses, to test non-linear and asymmetric interactions between various asset classes. The findings reveal that while cryptocurrencies, especially Bitcoin, frequently serve as net recipients of shocks during times of economic instability, gold and gold-backed assets are the primary shock transmitters. These findings highlight the increasing importance that digital assets play amid economic and geopolitical crises as well as their growing incorporation into the larger financial ecosystem. The study contributes to the literature on asset interconnection and provides implications for systemic risk management and financial stability; specifically, it offers insightful information for hedging and portfolio diversification techniques.

This study investigates the interconnectedness and spillover dynamics among G7 stock indices, focusing on two distinct systems: (1) G7 indices including the S P 500 and (2) G7 indices excluding the S P 500 but incorporating the Artificial Intelligence S P 500 (SPAI) index. Using quantile and frequency connectedness frameworks, we analyze data from October 2021 to August 2024 to capture both short- and long-term spillover effects across different quantiles. In the first system, the S P 500 emerges as a central net transmitter of shocks, reflecting its systemic importance and influence on global financial stability. European indices, such as DAX 40 and CAC 40, serve as major spillover contributors, while indices like Nikkei and S P TSX act predominantly as net receivers, highlighting regional dependencies. The second system shows that the SPAI index can primarily act as a net receiver, absorbing shocks from traditional markets. Yet, it is occasionally transmitter volatility, underscoring the growing integration of AI-driven sectors. Although the Total Connectedness Index is slightly lower in this system, European indices maintain their dominance as key transmitters, indicating consistent systemic importance. Short-term spillovers dominate in both systems, particularly during crises such as the COVID-19 pandemic and geopolitical conflicts, where heightened interconnectedness reduces diversification opportunities. The findings emphasize the S P 500’s pivotal role in traditional financial markets and the evolving significance of AI-driven indices. This dual-system analysis offers critical insights for risk management, portfolio diversification, and policymaking within an increasingly interconnected global financial framework.

This study explores the quantile time-frequency connectedness for returns-volume pairs across classic cryptocurrencies, NFTs, DeFi, and backed gold cryptocurrencies from November 2, 2021, to January 5, 2023. Utilizing quantile-connectedness measures derived from a QVAR model's variance decomposition, we observe heterogeneous Total Connectedness Indices (TCIs) over time, dependent on various events. Our analysis confirms the spillover effect between return and volume across all studied cryptocurrency markets. Notably, volume exhibits predictive power for returns in most cases, shedding light on the driving forces behind price adjustments under diverse market conditions, as revealed by time-frequency analysis. Furthermore, a long-term pattern is discerned among backed gold currencies, Meta, UPUNK, Tera, and BNB, alongside a short-term pattern. Regarding net directional results, returns are predominantly received from volume, driven by transactions at both ends of the volume spectrum, with exceptions for Link, Ethereum, Fix Token, and PMGT. Additionally, our findings unveil an asymmetry in both the overall TCI and short-term and long-term net TCIs.

Growing financialization, technological advancement and the dynamic nature of financial instruments have not only assisted in generating risk diversification opportunities but have also made financial markets susceptible to economic shocks and crises. In this context, the present study attempts to explore the dynamic risk transmission and interconnectedness of G7 stock indices and major currency pairs (JPY/USD and CHF/USD) from 2020 to 2024. The quantile and time-frequency analysis indicate notable global financial linkages, with the SP500 acting as a dominant net transmitter of risk, particularly influencing North American and European markets. Key European indices such as DAX 40 and CAC 40 also demonstrate substantial regional risk spillovers, while the Nikkei and major exchange rates primarily act as net receivers, absorbing shocks during periods of market stress. The study highlights the changing landscape of market connectedness, with peaks observed during the COVID-19 pandemic and a gradual return to stability thereafter. These findings provide useful insights into the dynamics of global risk transmission, highlighting the necessity for robust risk management strategies aimed at mitigating market volatility.

PurposeThis paper analyzes the connectedness with network among the major cryptocurrencies, the G7 stock indexes and the gold price over the coronavirus disease 2019 (COVID-19) pandemic period, in 2020.Design/methodology/approachThis study used a multivariate approach proposed by Diebold and Yilmaz (2009, 2012 and 2014).FindingsFor a stock index portfolio, the results of static connectedness showed a higher independence between the stock markets during the COVID-19 crisis. It is worth noting that in general, cryptocurrencies are diversifiers for a stock index portfolio, which enable to reduce volatility especially in the crisis period. Dynamic connectedness results do not significantly differ from those of the static connectedness, the authors just mention that the Bitcoin Gold becomes a net receiver. The scope of connectedness was maintained after the shock for most of the cryptocurrencies, except for the Dash and the Bitcoin Gold, which joined a previous level. In fact, the Bitcoin has always been the biggest net transmitter of volatility connectedness or spillovers during the crisis period. Maker is the biggest net-receiver of volatility from the global system. As for gold, the authors notice that it has remained a net receiver with a significant increase in the network reception during the crisis period, which confirms its safe haven.Originality/valueOverall, the authors conclude that connectedness is shown to be conditional on the extent of economic and financial uncertainties marked by the propagation of the coronavirus while the Bitcoin Gold and Litecoin are the least receivers, leading to the conclusion that they can be diversifiers.

This study provides an in-depth analysis of the dynamic connectedness among BRICS-plus stock indices, focusing on three distinct periods: pre-COVID-19 era, during the COVID-19 pandemic, and the Russia-Ukraine conflict. Utilizing the Quantile Vector Autoregressive (QVAR) connectivity approach, our methodology starts with the median quantile and systematically expands to various quantiles. This systematic progression allows us to comprehensively examine the temporal risk characteristics and interconnections across specific quantiles, enhancing our understanding through frequency domain analysis. Our findings reveal significant changes in the total connectedness index (TCI) and the roles of individual indices as either net transmitters or receivers of shocks during different crises. Particularly noteworthy is the resilience demonstrated by indices such as JTOPI, BVSP, TASI, and RTSI against risk transmission amidst the pandemic. Conversely, during the Russia-Ukraine conflict, BSE30, JTOPI, and ADX exhibited varying level of resilience. These insights underscore the sensitivity of financial markets to geopolitical events and highlight the importance of tailored risk management and investment strategies. The implications of our study are crucial for financial entities and policymakers aiming to optimize frameworks for market stability and risk mitigation in the face of global crises.

Climate change impact on the Blue-Green economy has been of great concern. Further cryptocurrency mining is impacting the economy in an adverse fashion. Moreover, impact of gold mining, extraction on Blue-Green economy and even relationship with cryptocurrency is another interesting facet. Therefore, we delved into the interconnectedness among five indices, two of which focus on the green economy (ICLN-iShares and CNRG-SandP), whereas three are on the blue economy (BJLE- BNP Paribas ESG Blue Economy ETF and PIO-Invesco Global Water ETF) and OCEN (IQ Clean Oceans ETF) alongside the traditional assets Bitcoin and gold indices. We considered between October 26, 2021, to January 5, 2024 for the study. This study highlighted some cardinal findings. First, BJLE can be used as a hedge against OCEN and PIO (all are in Blue economy). Second, excessive water usage in Bitcoin mining is detrimental to Blue-Green economy. Third, positive policy shock force spillover effect to cool down. Fourth, spillover typically increases as both economic uncertainty (US Banks collapse in 2023) and geopolitical risk (Russia-Ukraine conflict) increase. Fifth, there has been an increased responsiveness of these markets to immediate events (near-term bias). Therefore, this study would assist the policymakers and investors, especially in the Blue-Green domain.

Purpose This paper aims to analyze the connectedness between the natural gas, wheat, gold, Bitcoin and Gulf Cooperation Council (GCC) stock indices with the advent of exogenous and unexpected shocks related to the health and political crises. Design/methodology/approach For this end, a quantile-based connectedness method is applied on returns of different assets during the period 01/01/2016–05/01/2024. Findings The empirical findings display that the existence of time-varying connectedness between markets is well-documented and seems to be stronger during the COVID-19 pandemic and the Russia–Ukraine war. The connectedness is fostered with extreme events, showing that shocks propagate increasingly during turbulent periods compared with calm ones. The connectedness is event-dependent. Practical implications The empirical results offer insightful information for policymakers and investors about the contagion effect and volatility spillover among GCC stock markets and other asset classes during different crises. Originality/value This study examines different asset classes’ dynamism connection with sock prices in the GCC countries to better apprehend the (dis)similarities between different asset classes in terms of information transmission. It also investigates the connectedness structure among different asset classes under extreme market conditions and how spillover effects across GCC markets and other ones can be time- and event-dependent.

Our investigation strives to unearth the best portfolio hedging strategy for the G7 stock indices through Bitcoin and gold using daily data relevant to the period 2 January 2016 to 5 January 2023. This study uses the DVECH-GARCH model to model dynamic correlation and then compute optimal hedge ratios and hedging effectiveness. The empirical findings show that Bitcoin and gold were rather effective hedge assets before COVID-19 and diversifiers during the pandemic and Russia–Ukraine war. From hedging effectiveness perspectives, gold and Bitcoin are safe-haven assets, and the investment risk of G7 stock indices could be hedged by taking a short position during thepandemic period and war except for the pair Nikkei/Gold. Additionally, gold beats Bitcoin in terms of hedging efficiency. We thus demonstrate the central role of Bitcoin and gold as financial market participants, particularly during market turmoil and downward movements. Our findings can be of interest to investors, regulators, and governments to take into consideration the role of Bitcoin in financial markets.

The COVID-19 pandemic has challenged the notion that cryptocurrencies are uncorrelated with traditional asset markets. This study uses VAR-OLS techniques to investigate the time-varying correlation between Bitcoin and three major European stock market indices from January 4, 2016, to February 26, 2021. Our results show that cryptocurrencies and stock markets are dependent during crisis periods, but not during non-crisis periods. This confirms the time-varying correlation between cryptocurrencies and stock markets, which depends on the extent and persistence of responses to own and cross shocks. To improve the robustness of our results, we also test the impact of government measures on Bitcoin and stock market indices and find that they are both affected by these measures. Our study adds to the literature by examining the impacts of pandemics on the correlations between Bitcoin returns and the stock market, oil, and gold index returns, which have so far been unaddressed.

PurposeThis study attempts to explain the impact of Fintech on the Asian economies through two main indicators, inflation and unemployment over the period 2011-2014-2017.Design/methodology/approachThis study uses panel data regression models to explain the relationship between Fintech, inflation as an indicator of currency circulation and unemployment since Fintech has disrupted the labor market.FindingsEmpirical results show a consistently strong and positive relationship between the development of financial technologies and the reduction of inflation and unemployment unless these technologies are actively used. Digital finance has become a new driver of economic development. Therefore, governors should not only improve their economies but also expand their information and communication technologies to develop their digital infrastructure, especially for businesses.Originality/valueThe present study contributes to the existing literature on the impact of disruptive digital innovation on the socioeconomic development of emerging countries. The empirical evidence highlights the importance of distinguishing between active and passive uses of Fintech in order to anticipate its economic impact.

The paper aims to assess the resilience of fintechs to epidemic crises in Africa. This study is new in that it is one of the few to have examined the impact of fintechs on monetary stability in the African region, and it shows how digital tools have become crucial for regions to better manage their response to the crisis. To do so, we use the Ordinary Least Squares (OLS) technique to investigate the complexity of the relationship between Fintechs and monetary stability during the years 2011, 2014 and 2017. The study confirms that debit card use leads to an increase in inflation and participates in the decline of the interest rate. We also find that the use of the internet during transactions plays a stimulating role in lowering inflation, encouraging currency transactions and reinforcing the increase in interest rates. Finally, we conclude that the stability of money in bank accounts decreases the effect of inflationary pressures but favors exchange rates and interest rates together as a result of the increase in money.

PurposeThe purpose of this paper is to investigate the dynamic relationship between 19 pandemic and government actions, such as governmental response index and economic support packages.Design/methodology/approachThe authors use a panel dataset of 10 American and Latin countries for the period spanning from January 2020 to April 2021 to analyze the effect of government actions on stock market returns. The authors provide robust test results that improve the understanding of the impact of the pandemic on stock market indices through the break-up structure method and the new measure of Covid-19 extracted from Narayan et al. (2021) study.FindingsEmpirical results show the harmful effect of the corona virus on stock prices, hence the risk adverse behavior of investors. On the other hand, the quantitative approach reveals that the positive impact of government actions is degraded during Covid-19.Originality/valueThis article highlight that government actions may be effective in reducing new infections but could generate perverse economic impact through increasing uncertainty. The authors conclude that the adjustment of macroeconomic factors and the integration of financial news improve the forecasting performance of the model based on health news.

This study examines the connectedness between G7 indices, Bitcoin, and oil during the COVID-19 pandemic. Based on daily data from January 1, 2016 to April 1, 2021, a vector auto-regression model and an impulse response function are employed to illustrate the time path of these assets following own and cross-shocks. Our study exhibits the considerable effect of the pandemic on increasing directional causalities and time-varying connectedness between G7 indices, Bitcoin, and oil. The findings indicate that G7 indices’ own shocks almost immediately lower forecasts of stock return urging the diversification to reduce risk. Moreover, the significant negative response of oil to shocks amid the pandemic reflects its high vulnerability during mitigated periods. Unlike other countries, we find a relative resilience of Bitcoin to S&P 500 shocks, and we consequently recommend Bitcoin as a diversifier to Americaninvestors during the pandemic. Our results are useful for both investors and policymakers who need to think ahead, rather than waiting to have a downside G7 returns movement in turbulent periods.

The article aims to study the mechanisms underlying the development of research and development (R&D) through investment in renewable energies and in ICTs before and after the Covid19 pandemic. First, we perform a dynamic panel regression through panel data from 2000 to 2019 for 14 Asian countries. In addition to economic and environmental determinants, the empirical study reveals that variables linked to intellectual property are the drivers of R&D investment in the Asian region. It is interesting to note that while brand requests stimulate R&D, industrial applications hamper this type of investment. Second, we provide an OLS regression of 38 Asian countries to analyze the effect of Covid-19 on research and development. Our empirical results encourage governments to invest more in renewable energies not only to reduce the greenhouse effect, but also to increase investment in R&D. In addition, policymakers are urged to apply more incentives to expand the export of ICT in both services and products.