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Ryan Amsden

Bio: Ryan Amsden is an academic researcher from Desautels Faculty of Management. The author has an hindex of 1, co-authored 1 publications receiving 116 citations.

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Journal ArticleDOI
TL;DR: In this article, a theoretical framework for how venture uncertainty, venture quality, and investor opportunity set interrelate is developed to evaluate the performance of initial coin offer (ICO) campaigns.
Abstract: Initial Coin Offerings (ICOs) are a new and unregulated form of crowdfunding that raises funds through a blockchain by selling venture-related tokens or coins in exchange for legal tender or cryptocurrencies. In this paper, we establish token or coin tradability as the primary ICO success measure, and we develop a theoretical framework for how venture uncertainty, venture quality, and investor opportunity set interrelate. We use the largest available dataset to date, consisting of 1,009 ICOs from 2015 to March 2018. Our data highlights that venture uncertainty (not being on Github and Telegram, shorter whitepapers, higher percentage of tokens distributed) is negatively correlated, while higher venture quality (better connected CEOs and larger team size) is positively correlated, with ICO success. Moreover, providing a hard cap in a pre-ICO can help investors measure success in the pre-sale. This is another positive signal of funding success.

142 citations


Cited by
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Journal ArticleDOI
TL;DR: The authors examined which issuer and ICO characteristics predict successful real outcomes (increasing issuer employment and avoiding enterprise failure). Success is associated with disclosure, credible commitment to the project, and quality signals.
Abstract: Initial coin offerings (ICOs) have emerged as a new mechanism for entrepreneurial finance, with parallels to initial public offerings, venture capital, and pre-sale crowdfunding. In a sample of more than 1,500 ICOs that collectively raise $12.9 billion, we examine which issuer and ICO characteristics predict successful real outcomes (increasing issuer employment and avoiding enterprise failure). Success is associated with disclosure, credible commitment to the project, and quality signals. An instrumental variables analysis finds that ICO token exchange listing causes higher future employment, indicating that access to token liquidity has important real consequences for the enterprise.

236 citations

Journal ArticleDOI
TL;DR: In this article, the authors studied the emergence of ICOs across 187 countries and found that ICOs take place more frequently in countries with developed financial systems, public equity markets, and advanced digital technologies.
Abstract: Initial coin offerings (ICOs) are a rapidly growing phenomenon wherein entrepreneurial ventures raise funds for the development of blockchain-based businesses. Although they have recently sprouted up all over the world, raising millions of dollars for early-stage firms, few empirical studies are available to help understand the emergence of ICOs across countries. Based on the population of 915 ICOs issued in 187 countries between January 2017 and March 2018, our study reveals that ICOs take place more frequently in countries with developed financial systems, public equity markets, and advanced digital technologies. The availability of investment-based crowdfunding platforms is also positively associated with the emergence of ICOs, while debt and private equity markets do not provide similar effects. Countries with ICO-friendly regulations have more ICOs, whereas tax regimes are not clearly related to ICOs.

126 citations

Journal ArticleDOI
TL;DR: This article analyzed a dataset of 2390 completed ICOs, which raised a total of $12 billion in capital, nearly all since January 2017, and found evidence of significant ICO underpricing, with average returns of 179% from the ICO price to the first day's opening market price, over a holding period that averages just 16 days.
Abstract: We analyze a dataset of 2390 completed ICOs, which raised a total of $12 billion in capital, nearly all since January 2017. We find evidence of significant ICO underpricing, with average returns of 179% from the ICO price to the first day's opening market price, over a holding period that averages just 16 days. After trading begins, tokens continue to appreciate in price, generating average buy-and-hold abnormal returns of 48% in the first 30 trading days. We also study the determinants of ICO underpricing and relate cryptocurrency prices to Twitter activity.

117 citations

Journal ArticleDOI
TL;DR: A model rationalizing the economic value of digital tokens for launching peer-to-peer platforms by using the blockchain to transparently distribute tokens before the platform begins operation overcomes later coordination failures between transaction counterparties during the platform operation.
Abstract: We present a model rationalizing the economic value of digital tokens for launching peer-to-peer platforms: By using the blockchain to transparently distribute tokens before the platform begins operation, a token sale overcomes later coordination failures between transaction counterparties during the platform operation. This result follows from forward induction reasoning, under which the costly and observable action of token acquisition credibly communicates the intent to participate on the platform. Our theoretical framework demonstrates the applications of digital tokens to entrepreneurship, including initial coin offerings (ICOs), and offers guidance for both practitioners and regulators.

109 citations

Journal ArticleDOI
TL;DR: In this paper, the authors examined the performance of cryptocurrencies issued in initial coin offerings (ICOs) over a three-year period after the initial exchange listing and examined the average (median) ICO underpricing amount.
Abstract: This paper examines the performance of cryptocurrencies issued in initial coin offerings (ICOs) over a three-year period after the initial exchange listing. Average (median) ICO underpricing amount...

91 citations