The authors of this white paper put forth the idea of “supervisory nodes” as a generic term which can include many roles beyond the Fed’s regulatory supervisor role, such as an auditor, payments network rule-enforcer, or data reporting entity. They believe these “supervisory nodes” could be critical to making blockchain a transformative technology for regulators, if combined with machine learning and artificial intelligence to offer real-time views and insights into institutions and broader markets.
Blockchain, the future, and the end of the Wild West
By: Jim S. Cunha – Federal Reserve Bank of Boston
Initial coin offerings
Initial coin offerings (ICOs) are a significant innovation in entrepreneurial finance: start-ups can raise capital by selling blockchain-based digital assets, usually called “tokens.” This paper studies a sample of 453 tokens that completed ICOs and were subsequently traded on a secondary market exchange for at least 90 days. They examine which issuer and token characteristics are associated with success. They find:
- Issuers are usually building two-sided marketplaces; they are often decentralized, with no intellectual property or revenue model.
- The value proposition for ICOs requires the token’s value to increase with the value of the network.
Initial Coin Offerings: Financing Growth with Cryptocurrency Token Sales
Authors: Sabrina T. Howell, Marina Niessner, David Yermack
From: New York University, Yale University