The Power of Public Attention: A study on the relationship between Google Search Volume Index and Bitcoin price movements

Sammanfattning

The cryptocurrency market has grown in the global financial system, with Bitcoin attracting larger numbers of retail and institutional investors, as well as higher media attention over they ears. Understanding the factors that influence price movements in this unregulated market is therefore important for investors, policymakers and researchers. This study examines the relationship between retail investor attention and Bitcoin price movements over a fifteen-yearperiod from 2011 to 2025. Investor attention is proxied by the Google Search Volume Index(GSVI), retrieved from Google Trends, which captures the relative search frequency of theterm "Bitcoin" on a global scale. The study investigates whether variations in retail investor attention are statistically associated with three key market variables: Bitcoin returns, return volatility and trading volume. The analysis is grounded in behavioral finance theory, takinginto consideration herding behavior and the fear of missing out (FOMO) as drivers of the cryptocurrency market. The empirical analysis is based on monthly data and employs Ordinary Least Squares (OLS) regression across four time horizons: a full sample period (2011–2025) and three distinctfive-year sub-periods (2011–2015, 2016–2020 and 2021–2025). Control variables including the CBOE Volatility Index (VIX) and the S&P 500 return are included to account for broader macroeconomic conditions. The results show that GSVI has a statistically significant negative relationship with Bitcoin returns in the full sample period, but this effect disappears across all sub-periods, suggesting that the full-period finding may reflect structural differences between market phases rather than a consistent relationship. For return volatility, GSVI is a positive and statistically significant predictor across all three sub-periods, with the model's explanatory power increasing over time. No significant relationship is found between GSVI and Bitcoin trading volume in any time period examined. The findings suggest that retail investor attention increases market uncertainty rather than driving price in a certain direction, which is consistent with behavioral finance view regarding herding behavior. The study contributes to the existing literature by highlighting the role of digital attention in cryptocurrency markets and by demonstrating the importance of sub-period analysis when using Google Trends data as a research instrument.