*Article* **Investigating Dynamical Complexity and Fractal Characteristics of Bitcoin/US Dollar and Euro/US Dollar Exchange Rates around the COVID-19 Outbreak**

**Pavlos I. Zitis 1, Shinji Kakinaka 2, Ken Umeno 2, Michael P. Hanias 3, Stavros G. Stavrinides <sup>3</sup> and Stelios M. Potirakis 1,4,\***


**Abstract:** This article investigates the dynamical complexity and fractal characteristics changes of the Bitcoin/US dollar (BTC/USD) and Euro/US dollar (EUR/USD) returns in the period before and after the outbreak of the COVID-19 pandemic. More specifically, we applied the asymmetric multifractal detrended fluctuation analysis (A-MF-DFA) method to investigate the temporal evolution of the asymmetric multifractal spectrum parameters. In addition, we examined the temporal evolution of Fuzzy entropy, non-extensive Tsallis entropy, Shannon entropy, and Fisher information. Our research was motivated to contribute to the comprehension of the pandemic's impact and the possible changes it caused in two currencies that play a key role in the modern financial system. Our results revealed that for the overall trend both before and after the outbreak of the pandemic, the BTC/USD returns exhibited persistent behavior while the EUR/USD returns exhibited anti-persistent behavior. Additionally, after the outbreak of COVID-19, there was an increase in the degree of multifractality, a dominance of large fluctuations, as well as a sharp decrease of the complexity (i.e., increase of the order and information content and decrease of randomness) of both BTC/USD and EUR/USD returns. The World Health Organization (*WHO*) announcement, in which COVID-19 was declared a global pandemic, appears to have had a significant impact on the sudden change in complexity. Our findings can help both investors and risk managers, as well as policymakers, to formulate a comprehensive response to the occurrence of such external events.

**Keywords:** COVID-19; bitcoin; cryptocurrencies; forex market; complexity; entropy; multifractal analysis; complex systems; financial crisis; econophysics
