Do Cryptocurrencies Have Fundamental Values?

71 Pages Posted: 11 May 2020

See all articles by Yukun Liu

Yukun Liu

University of Rochester - Simon Business School

Jinfei Sheng

University of California, Irvine - Paul Merage School of Business

Wanyi Wang

University of California, Irvine - Paul Merage School of Business

Date Written: April 15, 2020

Abstract

This paper studies the role of technological fundamentals in Initial Coin Offering (ICO) successes and valuations. Using various machine learning methods, we construct four technology indexes for all cryptocurrencies from their ICO whitepapers. We find that the cryptocurrencies with high technology indexes are more likely to succeed and less likely to be delisted subsequently. Moreover, the technology indexes strongly and positively predict the long-run performances of the ICOs. Overall, the results suggest that technological fundamentals are an important determinant of cryptocurrency valuations.

Keywords: Initial Coin Offerings, Whitepaper, Machine Learning, Textual Analysis, FinTech, Blockchain.

JEL Classification: G12, G14, G23

Suggested Citation

Liu, Yukun and Sheng, Jinfei and Wang, Wanyi, Do Cryptocurrencies Have Fundamental Values? (April 15, 2020). Available at SSRN: https://ssrn.com/abstract=3577208 or http://dx.doi.org/10.2139/ssrn.3577208

Yukun Liu

University of Rochester - Simon Business School ( email )

Rochester, NY 14627
United States
6073791085 (Phone)

Jinfei Sheng (Contact Author)

University of California, Irvine - Paul Merage School of Business ( email )

4291 Pereira Dr
Irvine, CA 92697
United States

HOME PAGE: http://sites.google.com/site/shengjinfei/

Wanyi Wang

University of California, Irvine - Paul Merage School of Business ( email )

Irvine, CA 92697-3125
United States

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
169
Abstract Views
832
rank
197,118
PlumX Metrics