Financial Bubbles in Infinitely Repeated Auctions with Tokens

An auctioneer holds an infinite sequence of private value auctions. He can accept payments in a blockchain-based token that he creates and initially owns. I show that relative to a standard auction with dollars, the present-discounted value of the expected revenues is higher whenever financial bubbles on tokens emerge, which happens when the rate at which investors use their tokens for bidding is sufficiently low. Financial bubbles can also emerge if the auctioneer uses dollars and issues equity. But in this case, a bubble is possible only if an increasing amount of aggregate wealth is invested in equity, which seems counterfactual.