The Story
1
When we started our project, we got excited by the prospect of visualizing trends in bitcoins.
Specifically, we wanted to investigate whether or not buying bitcoin was a sound financial
investment. Not up to speed on bitcoin? Check out this video
and this video.
2
Our visualization is composed of two main parts. The first part is a small multiples area
visualization which plots the change in value of stock investments. The user can select which
company stock or stock index to dynamically add or remove through the control functionality
at the top right corner of the visualization. Additionally, the visualization plots the price
of a bitcoin (mtgoxUSD) since its origin (July 2010). There is also the option of changing
the visualization data from any of open, close, low, or high price, in addition to financial
transaction volume. Volume is plotted in thousands of dollars because that is the form in
which the data is provided from the Bitcoin API. This is in part due to the extremely
volatile pricing and mutlitide of currencies in which it is transacted. Additionally this
helps compare the transaction volume to stocks, whose units in numbers are not as meaningful
as in transaction volume. Finally the y-scale of the charts is unique for each of the plots
because they have wide variations in pricing. Nonetheless, the important factor in investment
comparison is percent change over time, which is dynamically generated when the plot is clicked.
3
The second part of the visualization are the bar charts linked down below. These charts are
meant to allow comparisons between different stocks and bitcoins on a given day.
4
From the visualization we can see that although typically bitcoin is not considered an
investment vehicle, and although it boasts much lower aggregate financial transaction volume,
the recent jump in price has led it to have extremely high return on investment. There has
also been a vast instability in bitcoin price in the past few weeks. In order to determine
the impact of hype and media on bitcoin pricing, we have also added the number of "bitcoin"
Google searches and relevant news stories about bitcoins alongside the pricing. The search
units are scaled from 0 - 100 in terms of the ratio of searches in a given week to the week
with the maximum number of searches, as this is the way the data is provided by Google
Trends. Try clicking "Bitcoin Search Trends." From these data points, it becomes evident that
bitcoin is highly correlated with news and hype, which may be largely
responsible for the recent instability in bitcoin pricing. Additionally there are red tick
marks below the bitcoin plot, which on hover, display relevant news stories about bitcoin on
those days to add more of a qualitative side to the bitcoin picture. Moral of the story? Buy a
bunch of bitcoin and then spread positive viral news stories about it! More seriously though,
it seems that bitcoin may be a high risk, high return alternative to common investments.
5
For a demo of how exactly our visualization works, checkout our screencast! You can also see our
process book here. The screencast highlights many of the interactive
elements of our visualization including the different data views, adding and removing stocks
dynamically, the area chart tooltip, the dynamic delta lines, panning/zooming the area chart,
the linked bar charts, the trends data and news articles, and more. The process book goes
through the thought process we went through in building our visualization.
6
When we first started out this project, Bitcoin was valued at around $35. Since then, the
price has skyrockted. Immediately after submitting Project 2, the price of Bitcoin enjoyed a
huge increase, up to $240! Right after that, the price crashed to as low as $60, and then
recovered to around $120 and has been increasing ever since. We can clearly see how volatile
the price of Bitcoin has been relative to almost every other stock on the market, thanks to
the dynamic stocks feature. The purpose of project 3 was to determine what the
correlation between the price of bitcoin and the media was, and the last month of price
changes gave us an ample opportunity to explore this. We can clearly see that more people
searched for Bitcoin during the last month, and that the quality of articles (and the
sensationalism) of the articles has also increased with the huge price changes. Although the
price has been changing a lot, the volume of Bitcoin that's been traded over the past month
has increased astronomically, and visually correlates well to the trends plot and to the
quality of articles about Bitcoin.
Because this isn't rigorous analysis, we can't be quite sure if Bitcoin's increased
popularity is the cause of its volatility in price and the trading volume increases. We're
also not sure if the dramatic changes in price are the causes of Bitcoin's popularity. They're
almost definitely related however, and we hope this visualization will give rise to more
exploration into this issue. Thank you for visiting our project!