ECIS 2020 Research Papers


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Following a significant increase in media attention through the exorbitant rise in Bitcoin prices in 2017, the Initial Coin Offering (ICO) was introduced as a new way for organisations and companies to fund their business, while retail investors were presented with a new opportunity to invest into young projects and companies. Little is known about who these investors are, why and how they invested in ICOs and how they evaluated their investments afterwards. Thus, in this paper, we investigate how investment behaviour and investment satisfaction is influenced by behavioural biases and personality traits of retail investors in ICOs. We analyse survey data from more than 300 respondents, finding that ICO investors are young, educated and in the majority male. Significant relationships between single biases and personality traits can be found. Investors demonstrate a unique set of personality traits, scoring low on neuroticism, which may explain consciously made, high-risk investments. Additionally, biases affect investment satisfaction, with overconfidence and disposition bias surprisingly being positively associated with investment satisfaction. Our results may help investors understand and improve their investment behaviour and decisions, while regulators may use this knowledge to assess the need to protect investors from costly mistakes in a new, technology driven market.



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