Virtual currencies, in particular bitcoin, peaked above the $5,000 (£3,795, €4,255) barrier on Thursday (12 October) jumping as much as 8% on the day as investors ignored warnings over the risks of buying into the booming cryptocurrency market.
As a nascent industry, cryptocurrencies have garnered viral attention, particularly over the last year.
At SEMrush we were curious to find out more about this and set off to examine these trends further, analysing by search volumes, popular keywords and PPC data within the cryptocurrency space, using a database of 120 million US keywords and 20 million UK keywords.
Here is what we found.
91% correlation: Price of bitcoin vs. Google searches
The current price of bitcoin has a 91% correlation with the volume of Google search requests for bitcoin-related terms. In other words, as bitcoin becomes more expensive, more people search online to find out how it is doing.
This suggests Google trends might be a reliable buy and sell indicator of bitcoin: when engagement levels run high, bitcoin users check the price daily. If engagement levels are too high, that's when there's a price bubble, and it's a good time to sell. Conversely, when engagement is at a low, it's a good time to buy.
Might we have found a magical bitcoin-Google connection?
Maybe. But please don't take our word for it!
"Initial Coin Offering (ICO)": 4614% increase in searches
For most of the history of blockchain-based currencies and assets, the story has been all about bitcoin, but with the rise of Ethereum and new ways to fund the development of new crypto-platforms (with ICOs), search volumes for the keyword 'Initial Coin Offering' have increased by 4614% over the last year.
Ethereum searches have also become more popular than ever. The term's search volume is now almost equal to the number of bitcoin-related searches. In fact, "Ethereum price" is now the fourth most popular searched keyword in the cryptocurrency space.
While blockchain remains a crucial centrepiece, people are realising how on its own it's limited only to currency and there's actually much more potential that should be exploited. The Ethereum platform, which enables blockchains to go far beyond that, allowing users to build any kind of applications on top, is gaining traction.
Cost per click in the UK vs. the US
Cost per click (CPC) is a method websites use to bill based on the number of times a visitor clicks on an advertisement. Many website owners use bitcoin CPC as it allows you to earn bitcoin or money online when your site visitors click on your ads. It is also a good way to earn ad networks – some of the major ones such as Google AdWords use it.
At SEMrush we decided to also examine the CPC for cryptocurrencies-related ads in 8 countries. The UK turned out to have the highest CPC rate out of all countries: its CPC was 800% higher than that of India and twice as high as the CPC of the US.
While we had no opportunity to carry out a correlation analysis to examine the connection between CPC and the amount of search requests or cryptocurrencies prices, it's rather intuitive that ad prices grow along with the cryptocurrencies prices and public interest towards them. This suggests that bitcoin might currently be more popular in the UK than in any other part of the world – yes, to many people's surprise, even the US.
There are already 450% more cryptocurrency-related searches today than there were three months ago. As the possibilities of and interest in blockchain grow, more people will be jumping on the bandwagon.
Just wait and see how these trends look in three months' time when we sit down and reassess the situation again!
Eugene Levin is Chief Strategy Officer at SEMrush