Abstract
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.
This is a preview of subscription content, log in via an institution to check access.
Notes
- 1.
The list of projects is available on request.
References
Ethereum Foundation: Crowdsale Raising funds from friends without a third party. (2017). https://www.ethereum.org/crowdsale. Accessed 31 Mar 2017
Bouncken, R.B., Komorek, M., Kraus, S.: Crowdfunding: the current state of research. Int. Bus. Econ. Res. J. 14(3), 407–416 (2015)
Jentzsch, C.: The History of the DAO and Lessons Learned. slock.it, 24 August 2016. https://blog.slock.it/the-history-of-the-dao-and-lessons-learned. Accessed 07 Apr 2017
Buterin, V.: Critical Update Re: DAO Vulnerability (2016). https://blog.ethereum.org/2016/06/17/critical-update-re-dao-vulnerability/. Accessed 07 Feb 2017
Okada, H., Yamasaki, S., Bracamonte, V.: Proposed classification of blockchains based on authority and incentive dimensions. In: 2017 19th International Conference on Advanced Communication Technology (ICACT), pp. 593–597 (2017)
Belleflamme, P., Lambert, T.: Crowdfunding: some empirical findings and microeconomic underpinnings. Forum Financ.: Revue Bancaire et Financière 2014(4), 288–296 (2014)
Lehdonvirta, V.: The blockchain paradox: why distributed ledger technologies may do little to transform the economy. Policy & Internet blog (2016). https://www.oii.ox.ac.uk/blog/the-blockchain-paradox-why-distributed-ledger-technologies-may-do-little-to-transform-the-economy/
De Filippi, P., Loveluck, B.: The invisible politics of Bitcoin: governance crisis of a decentralised infrastructure. Internet Policy Rev. 5(3), 28 (2016)
Kroll, J.A., Davey, I.C., Felten, E.W.: The economics of bitcoin mining, or bitcoin in the presence of adversaries. In: The Twelfth Workshop on the Economics of Information Security (WEIS 2013), p. 21 (2013)
Böhme, R., Christin, N., Edelman, B., Moore, T.: Bitcoin: economics, technology, and governance. J. Econ. Perspect. 29(2), 213–238 (2015)
O’Mahony, S.: The governance of open source initiatives: What does it mean to be community managed? J. Manage. Gov. 11(2), 139–150 (2007)
Gerber, E.M., Hui, J.S., Kuo, P.-Y.: Crowdfunding: why people are motivated to post and fund projects on crowdfunding platforms. In: Proceedings of the International Workshop on Design, Influence, and Social Technologies: Techniques, Impacts and Ethics, p. 10 (2012)
Luu, L., Chu, D.-H., Olickel, H., Saxena, P., Hobor, A.: Making smart contracts smarter. In: Proceedings of the 2016 ACM SIGSAC Conference on Computer and Communications Security, pp. 254–269 (2016)
Nakamoto, S.: Bitcoin: a peer-to-peer electronic cash system, p. 9 (2008). www.bitcoin.org
Acknowledgments
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).
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2017 Springer International Publishing AG
About this paper
Cite this paper
Bracamonte, V., Okada, H. (2017). An Exploratory Study on the Influence of Guidelines on Crowdfunding Projects in the Ethereum Blockchain Platform. In: Ciampaglia, G., Mashhadi, A., Yasseri, T. (eds) Social Informatics. SocInfo 2017. Lecture Notes in Computer Science(), vol 10540. Springer, Cham. https://doi.org/10.1007/978-3-319-67256-4_27
Download citation
DOI: https://doi.org/10.1007/978-3-319-67256-4_27
Published:
Publisher Name: Springer, Cham
Print ISBN: 978-3-319-67255-7
Online ISBN: 978-3-319-67256-4
eBook Packages: Computer ScienceComputer Science (R0)