Security Token Offerings – Determinants of Success for Token Sales

Proceedings of The 9th International Conference on New Ideas in Management, Economics and Accounting

Year: 2021


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Security Token Offerings – Determinants of Success for Token Sales

Nina Jüntgen, Cam-Duc Au and Alexander Zureck



We investigate the determinants, which have a positive impact on the likelihood of successful security token offerings (STOs). In doing so, the objective is the estimation of the success probability by introducing a logistic regression model. The quantitative research analyses data from 183 STOs that raised capital between 2017 and 2020. Since security tokens are regulated financial instruments, they should have less impact on the funding process. However, the results show that this is not always the case. If token issuers choose equity tokens for the asset class, the STO is 3.34 times more likely to be a success than other asset classes. Further research findings show that the probability of a successful STO is related to signals shaping the token’s financial characteristics, signals shaping the token’s technical and economic characteristics, and related to signals that affect the external factors. STOs can exploit these quantitative factors that are easy to implement until the market no longer considers these as quality indicators. The given research paper is of high relevance due to the novelty of the research field and aims to contribute to the existing research debate around the opportunities of distributed-ledger-technology in the financial industry context.

keywords: Blockchain, Security Token Offering, Initial Coin Offering, Distributed-Ledger-Technology, Token.