Token Tradability as a Platform Governance Mechanism: Evidence from a Policy Change

Status: Conference Submission Stage.
(Joint work with Yuxin Geng and Chenshuo Sun)

We show that enabling tradability of platform specific digital token without active value management hurts platform and user engagement. Strategic sellers and money illusion are responsible for this catastrophic outcome.

This paper holds a special place in my heart as it is my first collaboration with two authors who are not only academically but also physically younger than me. One of the authors, Yuxin, was actually a sophomore undergraduate student when we began this project.