An Exploratory Study on the Influence of Guidelines on Crowdfunding Projects in the Ethereum Blockchain Platform
In 2016, the DAO, a project which had raised $150 million in token sales in a crowdfunding campaign carried out on the Ethereum blockchain, was hacked using a vulnerability in its code. As part of the response to the incident, the Ethereum Foundation issued two guidelines: a security measure and a value limit. However, the characteristics of decentralized blockchain platforms make it difficult to establish or enforce new rules. In this paper, we investigate whether these guidelines had any influence on subsequent crowdfunding projects, by qualitatively analyzing the information provided by the projects’ organizers. The results indicate that the Ethereum Foundation guidelines had some, although limited, influence on how the projects were conducted, in particular with regard to setting a value limit to the campaigns. They also provide some evidence of the influence of the community in the implementation and improvement of security measures related to the smart contracts. We discuss these results in the context of the challenges of governance of crowdfunding projects running in public blockchain platforms.
KeywordsBlockchain technology Crowdfunding Governance Self-regulation
This research is part of the results of the joint project “Financial business applications of blockchain technology” (National Institute of Informatics and Sumitomo Mitsui Banking Corporation).
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