Paper Number

ICIS2025-1887

Paper Type

Short

Abstract

Blockchain technology enables the creation of decentralized transaction platforms, raising the critical question of how platform developers design the most suitable level of decentralization. This study develops a stylized model to investigate how the level of decentralization influences the participation and transactions between payers and payees in two-sided platform. Our findings reveal that high decentralization create high-commitment environment, making it attractive to high-profiled payees, but excludes payers with low perceived value due to higher system delays. Conversely, low decentralization promotes inclusivity, attracting both types of payers, though it often cannot sustain the participation of high-profiled payees. Furthermore, we examine the optimal platform design with a primary focus on maximizing transaction volume. The study provides actionable insights for developers in platform designs and establishes a foundation for future research on objectives such as social welfare, sustainability, and inclusivity.

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22-FinTech

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Dec 14th, 12:00 AM

Decentralized Processing

Blockchain technology enables the creation of decentralized transaction platforms, raising the critical question of how platform developers design the most suitable level of decentralization. This study develops a stylized model to investigate how the level of decentralization influences the participation and transactions between payers and payees in two-sided platform. Our findings reveal that high decentralization create high-commitment environment, making it attractive to high-profiled payees, but excludes payers with low perceived value due to higher system delays. Conversely, low decentralization promotes inclusivity, attracting both types of payers, though it often cannot sustain the participation of high-profiled payees. Furthermore, we examine the optimal platform design with a primary focus on maximizing transaction volume. The study provides actionable insights for developers in platform designs and establishes a foundation for future research on objectives such as social welfare, sustainability, and inclusivity.

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