Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/309491 
Year of Publication: 
2023
Citation: 
[Journal:] Electronic Markets [ISSN:] 1422-8890 [Volume:] 33 [Issue:] 1 [Article No.:] 31 [Publisher:] Springer [Place:] Berlin, Heidelberg [Year:] 2023
Publisher: 
Springer, Berlin, Heidelberg
Abstract: 
Many firms use social media (SM) to solicit online investments. In this study, we examine the interaction between SM attributes and online-investment attributes to determine how this interaction shapes users' investment decisions. Specifically, we investigate initial coin offerings (ICOs) as an application domain of distributed ledger technology for peer-to-peer investment. We use signaling theory to develop a context-specific explanation for how the interplay of persuasion signals found in SM and technology-enforced lockups shapes individuals' ICO investment decisions. To evaluate this interplay, we conducted a 2 × 2 factorial experiment with 473 participants. The results show that when an investment does not require a technology-enforced lockup, persuasion signals encourage investments in ICOs; however, when an investment requires a technology-enforced lockup, persuasion signals do not affect investments in ICOs. Furthermore, our analyses suggest that combining a technology-enforced lockup and persuasion signals reduces the ICO's plausibility. This is the first study to investigate how the willingness to invest in ICOs is influenced by the relationship between technology-enforced lockups and persuasion signals. The findings have practical implications for individuals attempting to make sound decisions on ICO investments, policymakers regulating online investments, and firms seeking to attract investors.
Subjects: 
Fintech
Technology-enforced lockup
Persuasion signals
Intention to invest
Plausibility
Social media
Experiment
JEL: 
G23
G28
G41
M13
M37
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article
Document Version: 
Published Version

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