Article (Scientific journals)
Institutional investors and post-ICO performance: an empirical analysis of investor returns in initial coin offerings (ICOs)
Fisch, Christian; Paul, Momtaz
2020In Journal of Corporate Finance, 64, p. 101679
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Keywords :
Initial coin offering; ICO; token sale; token offering; intitutional investors; venture capital; private equity
Abstract :
[en] We examine the role of institutional investors in initial coin offerings (ICOs). Taking a financial investor's perspective, we assess the determinants of post-ICO performance via buy-and-hold abnormal returns (BHAR) in a sample of 565 ICO ventures. Conceptually, we argue that institutional investors' superior screening (selection effect) and coaching abilities (treatment effect) enable them to partly overcome the information asymmetry of the ICO context and extract informational rents from their ICO investments. We find that institutional investor backing is indeed associated with higher post-ICO performance. Disentangling selection and treatment effects econometrically, we find that both of these effects explain the positive impact institutional investors have on post-ICO performance. Overall, our results highlight the importance of institutional investors in the ICO context.
Disciplines :
Strategy & innovation
Author, co-author :
Fisch, Christian  
Paul, Momtaz
External co-authors :
yes
Language :
English
Title :
Institutional investors and post-ICO performance: an empirical analysis of investor returns in initial coin offerings (ICOs)
Publication date :
2020
Journal title :
Journal of Corporate Finance
ISSN :
0929-1199
eISSN :
1872-6313
Publisher :
Elsevier, Amsterdam, Netherlands
Volume :
64
Pages :
101679
Peer reviewed :
Peer Reviewed verified by ORBi
Focus Area :
Entrepreneurship and Innovation / Audit
Available on ORBilu :
since 02 February 2022

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