Are Google Trends Predictive of New STEEM Accounts and Price?

Details

This analysis covers Google Trends for the search keyword "steem" alongside key blockchain activities. In this analysis, we also take a look at STEEM price and market cap. These three factors and the correlations they have with each other provide some interesting insights.

Outline

• Daily Account Creation/STEEM Price Correlation
• New Accounts/Google Trends Inverse Correlation
• Posting Activity/STEEM Price Correlation

Scope of Analysis

The scope of the analysis covers datasets over time of three specific pieces of data:

Google Trend Data

This data was pulled in two separate segments for the keyword "steem": July 1, 2017-Present, and January, 1 2018 - Present.

The reason for this is because Google Trend data does not provide actual number of searches, but instead provides relative data on a scale of 1 to 100 for the period of time requested. Pulling separate data segments allows greater insight into trends over the specified time.

Blockchain Activity

Two specific blockchain activities were pulled using the @privex SBDS database: comment (which also includes post) counts from January 1, 2017-Present and new account creations from January 1, 2017-Present.

The exact query used for this information is as follows:

SELECT    DATE(timestamp) as DATE, SUM(operation_num) as totalCOunt
FROM      sbds_tx_account_create_with_delegations  ##NOTE for comments/posts, the table is "sbds_tx_comments"##
WHERE YEAR(timestamp) = 2018 OR YEAR(timestamp) = 2017
GROUP BY  DATE(timestamp)

The data was then exported to CSV format.

STEEM Price Data

This data was pulled from CoinGecko.com, as they have an option to download all data in CSV format. I realize there are other sources for this, but this was quick and easy.

Tools

The tools used for this analysis include:

• RazorSQL
• Tableau
• Google Trends
• CoinGecko

Results

Comparing these three factors (Google, STEEM price, and blockchain activity) revealed several interesting tidbits:

Daily account creation seems to directly correlate with STEEM price fluctuations.

In many cases, account creation and price fluctuations inversely correlate with Google Trend levels for the keyword "steem". It is unclear if there is any causality, but these factors could potentially be used in prediction models.

Unsurprisingly, posting activity also seems to correlate with price fluctuations.

Daily Account Creation/STEEM Price Correlation

As you can see from this chart of the last 3-4 months, with a few exceptions, Daily Account Creation seems to directly correlate with price fluctuations. While the magnitude varies, spikes in Google activity seem to line up with spikes in account creation. Interestingly, the magnitude of this correlation seems to be much lower heading in to February as the market slows.

New Accounts/Google Trends Inverse Correlation

As you can see here, the January 3rd spike in new accounts is directly preceded by a spike in Google Trends for the keyword "steem" on January 2nd.

Along the same lines, a spike in account creations on January 29th is preceded by a spike in Google Trends on January 25th:

Posting Activity/STEEM Price Correlation

Perhaps most unsurprising is the finding that posting activity spiked significantly following January's price increase. On the other hand, while post activity saw a slight decline when the price dropped, it has still stayed fairly stable. That means people are still posting on the platform, despite rewards having decreased!

Conclusion

We've covered a lot of data in this analysis, so in summary, I will close with a hypothesis that I believe the data points to. I look forward to further discussion on this. My hypothesis is that the inverse correlation of Google Trend with account creation and price fluctuations shows that one trend is causing the other. It makes sense to me that price fluctuations (particularly increases) in the market may be leading to added interest in the platform. It is also interesting to me that Google Trends spikes seem to precede increases in new accounts and price. More data is needed, of course, and it will be interesting to see if this trend continues to persist.

It is comforting to see, on the other hand, that while price increases seem to spur greater engagement (via comments and posting) on the platform, decreases seem to have less impact on this activity.

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Posted on Utopian.io - Rewarding Open Source Contributors

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