TY  - BOOK
AU  - Aiello,Darren
AU  - Baker,Scott R.
AU  - Balyuk,Tetyana
AU  - Di Maggio,Marco
AU  - Johnson,Mark J.
AU  - Kotter,Jason D.
ED  - National Bureau of Economic Research.
TI  - The Effects of Cryptocurrency Wealth on Household Consumption and Investment
T2  - NBER working paper series
PY  - 2023///
CY  - Cambridge, Mass.
PB  - National Bureau of Economic Research
KW  - Non-bank Financial Institutions • Financial Instruments • Institutional Investors
KW  - jelc
KW  - General
KW  - Household Saving, Borrowing, Debt, and Wealth
KW  - Housing Supply and Markets
N1  - July 2023; Hardcopy version available to institutional subscribers
N2  - This paper uses transaction-level data across millions of accounts to identify cryptocurrency investors and evaluate how fluctuations in individual crypto wealth affect household consumption, equity investment, and local real estate markets. We estimate an MPC out of unrealized crypto gains that is more than double the MPC out of unrealized equity gains but smaller than the MPC from exogenous cash flow shocks. This MPC is mostly driven by increases in cash/check spending and mortgages. Moreover, households sell crypto to increase both discretionary as well as housing spending. As a result, crypto wealth causes house price appreciation--counties with higher crypto wealth see higher growth in home values following high crypto returns. Our results indicate that cryptocurrencies have substantial spillover effects on the real economy through consumption and investment into other asset classes
UR  - https://www.nber.org/papers/w31445
UR  - http://dx.doi.org/10.3386/w31445
ER  -