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Exploring the Success Factors of Security Token Offerings: An Empirical Approach

Author

Listed:
  • Jan Heinrich Beinke

    (German Research Center for Artificial Intelligence, Smart Enterprise Engineering, Parkstraße 40, 49080 Osnabrück, Germany)

  • Kai Rohde

    (Department of Banking and Finance, University of Osnabrück, Katharinenstraße 7, 49069 Osnabrück, Germany)

  • Fabian Pohl

    (BlockAxs GmbH, Paul-Lincke-Ufer 8b, 10999 Berlin, Germany)

  • Frank Teuteberg

    (Department of Accounting and Information Systems, University of Osnabrück, Katharinenstraße1, 49069 Osnabrück, Germany)

Abstract

Initial coin offerings (ICOs) have been established as an innovative capital-raising method. Nevertheless, numerous cases of ICO fraud are having a negative impact on investors. In particular, the lack of legal certainty (e.g., creditor protection) and the lack of direct participation in a company’s success (e.g., profit distribution) have led to an increasing number of security token offerings (STOs). These offer investors a degree of legal certainty and direct participation in company profits. However, to date, little scientifically-based knowledge exists regarding the factors that influence the funding success of an STO. We address this research gap by first identifying possible success factors for funding and then systematically analyzing 38 STOs that have already been carried out in order to determine the influence of those factors. Our analysis indicates that high-quality prototypes and high-quality teams are major drivers of STO funding success. Based on these results, we discuss the implications for science and practice, outline the limitations of our work, and identify further research needs.

Suggested Citation

  • Jan Heinrich Beinke & Kai Rohde & Fabian Pohl & Frank Teuteberg, 2021. "Exploring the Success Factors of Security Token Offerings: An Empirical Approach," International Journal of Information Technology & Decision Making (IJITDM), World Scientific Publishing Co. Pte. Ltd., vol. 20(05), pages 1339-1362, September.
    • Handle: RePEc:wsi:ijitdm:v:20:y:2021:i:05:n:s0219622021500358
    DOI: 10.1142/S0219622021500358
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    Citations

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    Cited by:

    1. Muneer M. Alshater & Mayank Joshipura & Rim El Khoury & Nohade Nasrallah, 2023. "Initial Coin Offerings: a Hybrid Empirical Review," Small Business Economics, Springer, vol. 61(3), pages 891-908, October.
    2. Timo Rogalski & Dirk Schiereck, 2024. "When is blockchain worth it? Value and risk drivers of corporate blockchain announcements," Electronic Markets, Springer;IIM University of St. Gallen, vol. 34(1), pages 1-24, December.
    3. Bongini, Paola & Osborne, Francesco & Pedrazzoli, Alessia & Rossolini, Monica, 2022. "A topic modelling analysis of white papers in security token offerings: Which topic matters for funding?," Technological Forecasting and Social Change, Elsevier, vol. 184(C).

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