Using data on investor beliefs about future Bitcoin prices, we examine how investors form expectations about Bitcoin returns. We find that investors extrapolate from Bitcoin’s past returns, with more weight on recent returns. Compared to institutional investors, such extrapolative beliefs are...

We show that the magnitude of the value premium over 1968-2018 is conditional on states of aggregate market-wide misvaluation. The value premium is 3.42% per month following market-wide undervaluation and 1.70% per month following market-wide overvaluation. When the aggregate market is neither...