 What determines success in initial coin offerings?Peter Roosenboom, Tom van der Kolk and Abe de Jong Venture Capital, 2020, vol. 22, issue 2, 161-183 Abstract: We analyse the determinants of success for 630 ICOs undertaken from August 2015 up until the end of December 2017, a period in which the market for ICOs grew to an unprecented level. We find evidence that ICOs are more successful in raising funding when they disclose more information to investors (i.e. have a higher profile rating), have a higher quality rating by cryptocurrency experts, have a pre-ICO GitHub repository, organise a presale, refrain from offering bonus schemes, have shorter planned token sale durations and have a larger project team. ICOs that disclose more information to investors and that have a higher quality rating at the time of the campaign show stronger ex-post performance. Longer-term project success is positively impacted by having a pre-ICO GitHub repository, a shorter planned token sale duration and having a larger project team at the time of the ICO, although these results depend on the ex-post success measure used. We conclude that for entrepreneurs it is important to make an ICO as transparent as possible and that profile and expert ratings are a valuable means to overcome the information asymmetry problems associated with token sales. Date: 2020 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:taf:veecee:v:22:y:2020:i:2:p:161-183 Ordering information: This journal article can be ordered from DOI: 10.1080/13691066.2020.1741127 Access Statistics for this article Venture Capital is currently edited by Colin Mason and Richard T. Harrison More articles in Venture Capital from Taylor & Francis Journals |
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