Document Type

Thesis or dissertation

Date of this Version



Bilge Yilmaz and Sarah Hammer


Initial Coin Offerings (ICOs) have become a popular way of fundraising for companies. While they can be highly profitable for both companies and investors, there is a large amount of risk involved due to their unregulated nature. Despite the vast majority of ICOs being scams, many individual investors still participate. This paper investigates why people invest in ICOs, using behavior finance biases. After analyzing white papers, ICO expert opinion and individual investors’ testimonies, the research found that the overconfidence bias and herd behavior & fear of missing out bias influences people’s decision to invest. Using the results, this study makes recommendations to help regulators decrease the influence of behavior finance bias.


Initial Coin Offerings, Behavior Finance, Overconfidence, Herd Behavior, Fear of Missing Out

Included in

Business Commons



Date Posted: 13 November 2019


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