We examine how coverage by mainstream media affects start-ups in raising funds through decentralised finance (DeFi). Building on contagion theory, we propose the concept of crowd contagion, arguing that the coverage by a reputable international financial newspaper can rapidly spread interest among investors. Using data from a highly reputable newspaper, we find that such coverage is positively associated with the likelihood that innovative, high-tech start-ups reach their funding goals. We suggest that this happens because the coverage by a reputable international financial newspaper helps raise awareness about a new asset class and builds legitimacy. Our results are robust against reverse causality and omitted variable bias. We discuss implications for research, practitioners and policy making.
Belghitar et al. (Tue,) studied this question.