Open Access

Moritz Bruckner, Adrian Straub, Daniel Veit

• Initial Coin Offerings (ICOs), are disrupting entrepreneurial financing by encouraging ventures to seek funds via generating and selling blockchain-based tokens to investors. Based on blockchain technology, this investor-investee relationship relies on a peer-to-peer basis and intermediaries are cut out of the funding process. The exclusion of intermediaries with the absence of regulation are causing high information asymmetries resulting in investor risks and increased opportunities for moral hazard and fraud. However, the total funding volume has increased remarkably since the first ICO. Current literature provides singular contributions on investor decisions to fund ICOs despite the risks, but is lacking an overview on ICO characteristics that influence investors’ decision-making. For this reason, the present research provides a systematic literature review, revealing six clusters of ICO characteristics that influence an investor’s decision-making process. In addition, the analysisInitial Coin Offerings (ICOs), are disrupting entrepreneurial financing by encouraging ventures to seek funds via generating and selling blockchain-based tokens to investors. Based on blockchain technology, this investor-investee relationship relies on a peer-to-peer basis and intermediaries are cut out of the funding process. The exclusion of intermediaries with the absence of regulation are causing high information asymmetries resulting in investor risks and increased opportunities for moral hazard and fraud. However, the total funding volume has increased remarkably since the first ICO. Current literature provides singular contributions on investor decisions to fund ICOs despite the risks, but is lacking an overview on ICO characteristics that influence investors’ decision-making. For this reason, the present research provides a systematic literature review, revealing six clusters of ICO characteristics that influence an investor’s decision-making process. In addition, the analysis revealed a significant literature gap on ex-ante motives for decisions on initial investments in ICOs.…