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Why do businesses go crypto? An empirical analysis of initial coin offerings

Saman Adhami, Giancarlo Giudici and Stefano Martinazzi

Journal of Economics and Business, 2018, vol. 100, issue C, 64-75

Abstract: In this work, we provide the first comprehensive description of the Initial Coin Offering (ICO) phenomenon, which by the end of 2017 allowed startups around the world to raise more than $5.3 billion, according to market observers. We analyze the determinants of the success of these token offerings by considering a sample of 253 campaigns. We find that the probability of an ICO’s success is higher if the code source is available, when a token presale is organized, and when tokens allow contributors to access a specific service (or to share profits). Our results provide valuable insights into this new source of capital for businesses and into the key determinants of fundraising success.

Keywords: Initial coin offerings; Cryptocurrencies; Blockchain; Fintech (search for similar items in EconPapers)
JEL-codes: G32 (search for similar items in EconPapers)
Date: 2018
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DOI: 10.1016/j.jeconbus.2018.04.001

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