Abstract

This paper analyzes and investigates the effect of cryptocurrencies growing on the capital stock prices (value relevance), and the financial performance of the international banking sector for the purpose of answering the paper’s major question regarding whether the effect of cryptocurrencies growing leads to a deterioration in the capital stock prices and financial ratios of the international banking sector. I use 5 regression models of significant R2 to investigate this relation, and to examine the paper’s hypothesis. The empirical results show initial empirical evidence that cryptocurrencies have no deteriorating effect on international banks’ capital stock prices and financial performance, and predict no potential deteriorating effect in the future as well, even if the cryptocurrencies kept on growing, and the beneficiaries from those cryptocurrencies are favoring and willing to grow the cryptocurrencies markets. I recommend for future research to continue investigating the effect of cryptocurrencies’ growing on the value relevance, and financial performance of the international banking Sector, and to replicate and expand my study by using larger sample of international banks financial reports and wider range of cryptocurrencies growing in their markets, in order to monitor the cryptocurrencies growing and banks growing in the meantime, and stand on their sustainability or their collapse in the future.

Keywords: Cryptocurrencies, Digital coins, Value relevance, Banks’ Financial ratios, International banks, Banks’ financial performance