 Financing decentralized digital platform growth: The role of crypto funds in blockchain-based startupsDouglas Cumming, Wolfgang Drobetz, Paul P. Momtaz and Niclas Schermann Journal of Business Venturing, 2025, vol. 40, issue 1 Abstract: Coordination frictions prevent the efficient adoption and governance of blockchain-based platforms. Crypto funds (CFs) create value by smoothing frictions on decentralized digital platforms (DDPs). CF-backed DDPs obtain higher valuations in the primary token market, outperform their peers after issuing tokens, and benefit from token price appreciation around CF investment disclosure in the secondary market. Primary transaction data from the Ethereum ledger shows that the valuations of DDPs with meager adoption and a higher centralization of token ownership benefit more from CF backing. The positive valuation and performance effects for CF-backed DDPs are more pronounced for CFs that are more central in investor networks. Keywords: Crypto funds (CFs); Initial coin offering (ICO); Digital platform adoption and governance; Blockchain-based crowdfunding; Decentralized finance (DeFi) (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jbvent:v:40:y:2025:i:1:s0883902624000727 DOI: 10.1016/j.jbusvent.2024.106450 Access Statistics for this article Journal of Business Venturing is currently edited by S. Venkataraman More articles in Journal of Business Venturing from Elsevier |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
School of Business at Örebro University.