Historical Determinants of Fintech Development: Evidence from Initial Coin Offerings

This paper examines the impact of historical endowment on the Initial Coin Offering (ICO) market. Leveraging a sample of 1,617 hand collected ICOs over 2015-2019 and regressions models, we find that a country’s legal origin, disease environment, exposure to slave trade, and proximity to ancient trade routes are important determinants of the total amount of capital raised through ICOs. Further analyses suggest that the impact of historical endowment operates through legal and information sharing institutions. This finding suggests that traumatic shocks in the history plays an important role in shaping current Fintech development through long-run persistence of formal and informal institutions. This research highlights the importance to enlarge the scope of Fintech research and the importance to take institutions into account in relevant policy designs to promote financial development. Original language English Article number 102472 Journal Finance Research Letters Early online date 20 Sept 2021 DOIs https://doi.org/10.1016/j.frl.2021.102472 Publication status E-pub ahead of print - 20 Sept 2021 Keywords / Materials (for Non-textual outputs) ICA Fintech financial development history institutions ICO