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


  • Adhami, Saman
  • Giudici, Giancarlo
  • Martinazzi, Stefano


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.

Suggested Citation

  • Adhami, Saman & Giudici, Giancarlo & Martinazzi, Stefano, 2018. "Why do businesses go crypto? An empirical analysis of initial coin offerings," Journal of Economics and Business, Elsevier, vol. 100(C), pages 64-75.
  • Handle: RePEc:eee:jebusi:v:100:y:2018:i:c:p:64-75
    DOI: 10.1016/j.jeconbus.2018.04.001

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    References listed on IDEAS

    1. repec:kap:sbusec:v:50:y:2018:i:2:d:10.1007_s11187-016-9830-x is not listed on IDEAS
    2. Rainer Böhme & Nicolas Christin & Benjamin Edelman & Tyler Moore, 2015. "Bitcoin: Economics, Technology, and Governance," Journal of Economic Perspectives, American Economic Association, vol. 29(2), pages 213-238, Spring.
    3. Dwyer, Gerald P., 2015. "The economics of Bitcoin and similar private digital currencies," Journal of Financial Stability, Elsevier, vol. 17(C), pages 81-91.
    4. C. Baek & M. Elbeck, 2015. "Bitcoins as an investment or speculative vehicle? A first look," Applied Economics Letters, Taylor & Francis Journals, vol. 22(1), pages 30-34, January.
    5. repec:wsi:wschap:9789813230972_0012 is not listed on IDEAS
    6. Eric von Hippel & Georg von Krogh, 2003. "Open Source Software and the “Private-Collective” Innovation Model: Issues for Organization Science," Organization Science, INFORMS, vol. 14(2), pages 209-223, April.
    7. Cheah, Eng-Tuck & Fry, John, 2015. "Speculative bubbles in Bitcoin markets? An empirical investigation into the fundamental value of Bitcoin," Economics Letters, Elsevier, vol. 130(C), pages 32-36.
    8. Pilkington Marc, 2016. "Blockchain Technology: Principles and Applications," Post-Print halshs-01231205, HAL.
    9. John P. Conley, 2017. "Blockchain and the Economics of Crypto-tokens and Initial Coin Offerings," Vanderbilt University Department of Economics Working Papers 17-00008, Vanderbilt University Department of Economics.
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    Cited by:

    1. repec:gam:jjrfmx:v:11:y:2018:i:4:p:80-:d:184453 is not listed on IDEAS
    2. Christian Masiak & Joern H. Block & Tobias Masiak & Matthias Neuenkirch & Katja N. Pielen, 2018. "The Market Cycles of ICOs, Bitcoin, and Ether," Research Papers in Economics 2018-04, University of Trier, Department of Economics.

    More about this item


    Initial coin offerings; Cryptocurrencies; Blockchain; Fintech;

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill


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