FOMO in Digital Assets

Abstract

This study examines the Fear of Missing Out (FOMO) sentiment as a motivation for retail investors to own ICOs. In the extant literature, this sentiment is suggested to be a possible factor explaining ICO investing. This study examines this empirically. Using novel OECD survey data on ICO investing in Malaysia, the Philippines and Vietnam, this study finds that FOMO is a motivational driver in ICO ownership. When FOMO is interacted with wealth, their explanatory effect of ICO ownership is high at 25%. Furthermore, the study also finds that ICO investors are also motivated by long-term investing.

The peer-reviewed, final version (2023) can be found through this link: https://www.taylorfrancis.com/chapters/edit/10.4324/9781003351085-11/fomo-digital-assets-tatja-k%C3%A4rkk%C3%A4inen

Keywords: Initial Coin Offerings, Corporate Finance, Blockchain, Sentiment

JEL Classification: D18, D47, G11, O16, G41