The Impact of Blockchain Technology Adoption Announcements on Firm’s Market Value

Abstract

Despite the growing interest in blockchain (BC) technology, recent research shows mixed perceptions due to its risks and returns. We utilize event study methodology to examine overall market reactions and to delineate how specific contexts associated with BC technology influence the market reactions. Using 149 BC technology adoptions announced between January 2015 and December 2019, we find positive abnormal returns, reflecting investors’ optimistic perception towards BC technology adoption. Specifically, we find that abnormal returns from BC technology are higher when used in a transformative strategic role and offered by leading vendors, suggesting that investors view this adoption as a value-enhancing activity. Our results are robust to the use of an alternative sample and different methods of measuring variables. Overall, our study provides insights for academics and practitioners to better understand the market value of BC technology adoptions.