Measuring misconduct in financial markets

Karlsen, Jonathan R.

Measuring misconduct in financial markets

Karlsen, Jonathan R.

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Publication Type:: Thesis
Issue Date:: 2021

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Field	Value	Language
dc.contributor.author	Karlsen, Jonathan R.
dc.date.accessioned	2022-04-12T23:06:44Z
dc.date.available	2022-04-12T23:06:44Z
dc.date.issued	2021
dc.identifier.uri	http://hdl.handle.net/10453/156156
dc.description	University of Technology Sydney. Faculty of Business.	en_US.UTF-8
dc.description.abstract	Fair and efficient financial markets facilitate economic growth by providing funding for firms, investments for individuals, and risk allocation mechanisms. New technologies such as blockchains have the potential to improve these markets by providing more efficient settlements and a range of applications implemented in smart contracts. However, for financial markets and financial technologies to deliver their full potential, they must not only be efficient but also operate with a high level of integrity. This thesis takes the first step by measuring integrity in equity markets around the world and in the largest cryptocurrency, bitcoin. Using two independent empirical models, the thesis estimates that approximately one-quarter of all bitcoin users are involved in illegal activity and are responsible for one-half of all transactions in the bitcoin network, equivalent to a total value of $76 billion per year. Illegal users use bitcoin as a payment system rather than for speculation and take precautionary measures to conceal their activity. The thesis then develops measures of market integrity in equity markets based on the estimated frequency of insider trading and market manipulation and finds that developed countries exhibit high levels of integrity because of their resourceful regulatory bodies, low corruption levels, and rule-abiding societies.	en_US.UTF-8
dc.format	Thesis (PhD)
dc.language.iso	en_US	en_US.UTF-8
dc.relation	https://opus.lib.uts.edu.au/bitstream/10453/156156/2/02whole.pdf
dc.rights	The author owns the copyright in this thesis including all reproduction and reuse rights for the work. The work may not be altered without the permission of the copyright owner. Attribution is essential when quoting or paraphrasing from this thesis.
dc.rights	au.edu.uts.lib/ppc
dc.rights	info:eu-repo/semantics/openAccess
dc.title	Measuring misconduct in financial markets	en_US.UTF-8
dc.type	Thesis
utslib.copyright.status	open_access	*

Abstract:

Fair and efficient financial markets facilitate economic growth by providing funding for firms, investments for individuals, and risk allocation mechanisms. New technologies such as blockchains have the potential to improve these markets by providing more efficient settlements and a range of applications implemented in smart contracts. However, for financial markets and financial technologies to deliver their full potential, they must not only be efficient but also operate with a high level of integrity. This thesis takes the first step by measuring integrity in equity markets around the world and in the largest cryptocurrency, bitcoin. Using two independent empirical models, the thesis estimates that approximately one-quarter of all bitcoin users are involved in illegal activity and are responsible for one-half of all transactions in the bitcoin network, equivalent to a total value of $76 billion per year. Illegal users use bitcoin as a payment system rather than for speculation and take precautionary measures to conceal their activity. The thesis then develops measures of market integrity in equity markets based on the estimated frequency of insider trading and market manipulation and finds that developed countries exhibit high levels of integrity because of their resourceful regulatory bodies, low corruption levels, and rule-abiding societies.

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http://hdl.handle.net/10453/156156