Digital Business 2 (2022) 100041

Contents lists available at ScienceDirect

Digital Business
journal homepage: www.elsevier.com/locate/digbus

An integrative model of trust toward crypto-tokens applications: A

customer perspective approach
Elissar Toufaily
Associate Professor of Marketing, American University in Dubai, Dubai, United Arab Emirates

A R T I C L E I N F O A B S T R A C T

Keywords: Trust is a key driver of consumers' acceptance and adoption of innovations. The purpose of the paper is to explore
Consumer trust and understand the factors that facilitate the creation of trust in crypto-tokens decentralized applications (DApp)
Decentralized applications from the perspective of the consumer. A qualitative research design has been used and forty-five participants
Blockchain
were interviewed for the study. Based on a theory-driven approach of qualitative data analysis, a multidimen­
Cryptocurrencies
Crypto-tokens
sional, holistic conceptual framework of trust has been proposed. The model captures the core categories that
Web 3.0 affect consumer's trust toward crypto-tokens applications. It highlights the need to understand the individual,
technological, environmental and use-case features which shape the way blockchain-based applications can be
trusted. The framework can be used by policymakers, educators, exchange platforms, DApp developers, and
entrepreneurs to develop strategies that cultivate on the drivers of trust, and create value with crypto-tokens and
Web3.0 economies. Higher trust ultimately promotes acceptance and adoption of blockchain applications.

1. Introduction istence of a transaction, providing confidence and certainty of comple­

Trust is a key driver of consumers' acceptance and adoption of in­
novations. Trust underlies all economic transactions in the presence of
uncertainties (Bons, Versendaal, Zavolokina, & Shi, 2020; Mcknight &
Chervany, 2001), and is fundamental in achieving efficient mechanisms
in market exchanges (Zucker, 1986). Intermediaries in a transaction,
such as banks and financial institutions, play the role of trust guarantees
of the operations by ensuring the security of customers' accounts and
financial transactions, and by managing the risk associated with dealing
with a potentially unknown counterparty (Marella, Upreti, Merikivi, &
Tuunainen, 2020; Vaz & Brown, 2020). According to Zucker (1986),
banking is an institutional arrangement with intermediary mechanisms,
which can be characterised as a provider of trust in an active market.
Financial institutions certify and guarantee ownership of money or ex­
tion of transactions (Vaz & Brown, 2020).
In recent years, customers' trust toward financial institutions, banks
and intermediaries has been put to test due to failure in accountability,
high fees, lack of transparency (e.g., Lehman Brothers) and the financial
exclusion of the disadvantaged segments of any society. Financial in­
termediaries have failed in building an inclusive trusted environment
and some argue that these institutions are no longer needed and can be
removed from the economic transactions. With the advance of
blockchain-based decentralized applications, institutions that tradi­
tionally supported the production of trust are replaced by a network of
nodes that guarantee that the system function correctly. Through the
consensus mechanisms, transactions happening on the blockchain are
mostly immutable, correct and irreversible (Beck, Müller-Bloch, & King,
2018; Bons et al., 2020; Iansiti & Lakhani, 2017). The technical mea

E-mail address: etoufaily@aud.edu.

https://doi.org/10.1016/j.digbus.2022.100041
Received 30 April 2022; Received in revised form 21 September 2022; Accepted 21 September 2022
Available online 24 September 2022
2666-9544/© 2022 The Author. Published by Elsevier B.V. This is an open access article under the CC BY-NC-ND license (http://creativecommons.org/licenses/by-
nc-nd/4.0/).
E. Toufaily
sures used by blockchains eliminate the need to trust parties as in­
termediaries (Berk, 2017).
Cryptocurrencies (aka crypto-tokens or tokens1) are defined as
“innovative digital currencies backed by cryptography to secure and
govern the transactions and supply of digital coins in circulation”
(Davidson, 2013 in Marella et al., 2020, p. 259). Cryptocurrencies are
immune from a central authority and government manipulation. They
are based on the blockchain technology, described as a Distributed
Ledger Technology (DLT) reinforced by vital principles: decentraliza­
tion; peer-to-peer transmission; transparency with pseudonymity; irre­
versibility of records; computational logic; seizure-resistance and
censorship-resistance (Iansiti & Lakhani, 2017; Toufaily, Zalan, &
Dhaou, 2021). Compared to financial instruments, cryptocurrencies are
not institutionally and legislatively backed at a global scale, are yet to
obtain legal status in many countries (e.g., Switzerland). Crypto­
currencies have been branded in relation with money laundering, illegal
trade and tax evasion and volatility due to their attractiveness index to
investors, market forces (i.e. demand and supply) (Folkinshteyn &
Lennon, 2016), attacks on the wallets and crypto-exchanges (Marella
et al., 2020), and the influence of macro financial developments (e.g.,
Bouoiyour & Selmi, 2006).
Albeit their associated challenges, crypto-tokens increased popu­
larity and usage imply that a community of users, institutions, and
technology enthusiasts are willing to trust the innovation. Crypto-tokens
proponents stress the essential relevance of disintermediation and utility
as causes. Crypto-tokens can offer several utilities: they can be used to
transfer value between business partners in a blockchain-based
ecosystem; they can incentive people to use a specific service managed
via the blockchain; they can serve to finance blockchain-based start-ups,
and they enable community of an ecosystem to achieve network effects
(Tönnissen, Beinke, & Teuteberg, 2020). However, it is still not fully
understood what are the drivers that lead individuals' trust toward
crypto-tokens and consequently their adoption. Despite their utilities,
crypto-tokens appear to face the main challenge posed by trust as a
critical factor for acceptance and adoption whether as payment tools,
speculative investments or long-term holding assets.
The literature discusses blockchain as a trust-free (e.g., Werbach,
2018) or confidence system (e.g., De Filippi, 2019), and the advantages
of the application of trust-free networks (e.g., Smits & Hulstijn, 2020.
Most of the existing research shows that trust is mainly grounded in the
ability of blockchain networks to enforce rules and contractual agree­
ments without a mediating authority. The literature conceptualizes trust
mostly in the technology-based layers (Hawlitschek, Notheisen, &
Teubner, 2018; Zhou, Zhang, Zhao, Zheng, & Song, 2021), and within
the boundaries of the blockchain engineering, through a technical idea
of a trust-free network that doesn't pave the way and ensure that entities
outside the closed blockchain ecosystem will be able to trust. This
“trustless” technical layer does not guarantee the consumer's trust
1 organizational context.
Cryptocurrencies, tokens, crypto-tokens and crypto-based applications are
used interchangeably in this paper. Tokens — which can also be referred to as
crypto-tokens — are units of value that blockchain-based organizations develop
on top of existing blockchain networks. These tokens can serve a multitude of
functions on the platforms for which they are built, including participating in
Decentralized Finance (DeFi) mechanisms, accessing platform-specific services,
and even playing games. Because crypto-tokens, like cryptocurrency, can hold
value and be exchanged, and are designed as digital assets, they will be used
interchangeably in this paper. The paper does not differentiate between utility
tokens, governance tokens, or securities tokens. It discusses cryptocurrencies or
tokens in general. Most of the tokens (so called utility tokens) are used as a
currency to pay for the applications offered by the blockchain-based organi­
zations (Tönnissen et al., 2020).It is important to mention that the biggest
differentiation between cryptocurrencies and tokens is that cryptocurrencies
have their own blockchains (e.g., BTC, ETH), whereas crypto-tokens are built
on top of an existing blockchain (e.g., DAI, COMP, Crypto kitties built on top of
Ethereum blockchain) (Cryptopedia, 2021)
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Digital Business 2 (2022) 100041
toward blockchain- based applications. According to Tönnissen et al.
(2020), trust mechanisms are needed and are effective methods that
help to dissipate consumers' skepticism about the use of the blockchain
networks and their crypto-tokens applications. Many promises of the
blockchain economy are grounded in the ability of the technology in
reducing the coordination costs of economic activities and eliminating
trust in centralized authorities (Beck et al., 2018). However, socio-
technical issues in relation to blockchain and crypto-tokens still
remain existent. For example, smart contracts entail high risk in the
involved parties due to autonomous enforcement mechanisms in which
coding errors or changes in conditions could have major consequences
(Beck et al., 2018). Due to the challenges and risks associated with
blockchain and its applications, trust is still needed.
Thus, the purpose of this paper is to explore and understand the
factors that facilitate the creation of trust in crypto-tokens decentralized
applications (DApp) from the perspective of the consumer. As trust has
shifted from one set of people, institutions and centralized in­
termediaries (Hawlitschek, Notheisen, & Teubner, 2020; Murck, 2017)
to validators, service providers, and developers of DApps, protocols, and
smarts contracts, it is crucial to understand the attributes of the tech­
nology and the drivers in its ecosystem that build or impede trust by
existing and potential users. Thus, we aim to answer the following
question: what determine consumers trust and adoption of crypto-based
applications? We believe that answering this question is essential as its
consequences might impact different stakeholders and not only indi­
vidual consumers or institutional investors, but financial institutions,
exchanges platforms, banks, regulators and governments. The need for
trusted intermediaries arise not just for transacting purposes but also to
assist in protection, storage and transport of wealth. Financial in­
termediaries have met the need to reduce risk in undertaking trans­
actions between two parties who may not trust each other and may also
not be known to each other. How can crypto-tokens achieve this trust
while disintermediation is their characteristic? Beck et al. (2018)
address that research on trust is a promising area in the blockchain
literature The focus is on crypto-tokens as decentralized applications of
the blockchain and not trust in the technology per se.
Our contribution to the academic research resides in proposing a
multidimensional and holistic data-driven conceptual framework. The
model captures the different dimensions that affect consumer's trust
toward crypto-tokens applications. Previous research (e.g., Ooi, Ooi, &
Yeap, 2021; Steinmetz, Meduna, Ante, & Fiedler, 2021) that investi­
gated trust in crypto-tokens have adopted a parsimonious perspective,
neglecting the holistic approach in identifying the micro and macro
drivers of building trust toward DApp. Most research focuses on the
consequences of trust-free economic networks, but not on the concept of
trust or trust-building (exception for Ostern, 2018; Marella et al., 2020).
The environmental, institutional and personal factors as prerequisite for
users to trust and adopt blockchain-based applications are almost absent
from the current literature. Trust does not develop in a vacuum but,
instead, evolves in a complex individual, cultural/environmental and
Thus, it is of crucial significance for both theory and practice to
clearly understand the drivers and hinders of building a trust layer on
top of the trustless technology. This will allow to develop meaningful
applications of blockchain and build trust in the crypto-tokens economy.
In this paper, we explore these drivers of a trust layer above the
“trustless” technical layer presented in the literature. For managers and
DApp developers, the proposed framework can be used to understand
the broader implications of trust from the consumers' perspective. It
allows them to create value and increase their chance of building suc­
cessful decentralized applications by focusing on trust drivers, and by
building strategies to face the challenges perceived by users for suc­
cessful adoption.
The paper proceeds as follows: First, we offer a brief literature review
on crypto-tokens applications, trust and adoption, we then present, in
section 3, the research design of the paper. In section 4, we examine the
E. Toufaily
findings and discuss their implications and their link to the literature.
Section 5 presents the conceptual framework which emerged from the
data. In section 6, we discuss our findings and finally, in the last section,
we conclude and provide future research orientations on crypto-tokens
and trust.
2. Literature review and theoretical foundation
Blockchain is an interdisciplinary and cross-domain technology
(Casino, Dasaklis, & Patsakis, 2019; Zhou et al., 2021). The evolution of
blockchain research involves many disciplines with two major disci­
plines- computer science and business- leading the way (Zhou et al.,
2021). The received literature has been advancing mainly in the fields of
information systems, economics, finance, taxation, accounting and
regulation, with a minimal of work dedicated to crypto-tokens from a
marketing perspective (Holub & Johnson, 2018).
Different systematic literature reviews have clustered the existing
research done on blockchain technology and crypto-tokens applications.
Casino et al. (2019), through a thematic content analysis of blockchain-
based applications, highlighted the growing interest from the academic
sector into blockchain and classified its applications into financial and
non-financial ones. Financial applications include business services,
settlement of financial assets, prediction marketplaces and economic
transactions. Non-financial applications include integrity verification
applications that store information and transactions related to the cre­
ation and lifetime of products and services such as provenance and
counterfeit, intellectual property management (e.g., applications such as
Ascribe and Mediachain) (Casino et al., 2019). Non-financial applica­
tions include also governance such as voting (e.g., Futarchy), Internet of
things (IoT), supply chain management, energy sector, education, data
management, healthcare management, and privacy and security (e.g.,
Alexandria which is an open-source blockchain application that pro­
vides a secure and decentralized library of any kind of media while
allowing the freedom of speech and enabling security and anonymity).
According to Casino et al. (2019), issues and challenges deriving from
the blockchain-based applications are still present and researchers as
well as developers are investigating them to provide solutions in relation
to scalability, sustainability of the blockchain protocols, interopera­
bility, security and privacy.
As per Zhou et al. (2021), existing research on blockchain is sparsely
covered and typically relies on a single research method. By using
multiple complementary scientometric methods, the authors found that
blockchain research can be divided into four main research areas: un­
derlying technology architecture, privacy and security, financial appli­
cations, and smart applications. The evolution of blockchain research
has gone through three stages: basic blockchain technology, various
business applications and integration with advanced technologies such
as IoT and Artificial Intelligence (AI) (Zhou et al., 2021). Tönnissen et al.
(2020) confirm these findings and describe that the initial growth of
blockchain technology (Blockchain 1.0) solely came from use-cases with
different kind of cryptocurrencies. The next generation (Blockchain 2.0)
builds on contracts and offers broader range of functions. Blockchain
3.0, with applications, widely broader than currencies has been emerged
(Swan & De Filippi, 2017; Tönnissen et al., 2020). Tönnissen et al.
(2020) coined businesses on blockchain platforms as token-based eco­
systems, and argued that these ecosystems have attracted little attention
in the scientific literature- although the importance of digital ecosystems
has increased significantly in recent years.
The evolution of blockchain research includes similarly the gover­
nance framework in the blockchain economy- a new type of an economic
system (Beck et al., 2018). Blockchain economy extends beyond the
digital economy in that agreements upon transactions are autonomously
enforced, following rules defined in smart contracts. New organizational
design- Decentralized Autonomous Organization- DAO- is enabled by
the blockchain economy – where smart contracts can execute trans­
actions autonomously without interference from agents or the need for
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Digital Business 2 (2022) 100041
approval from third-parties. Beck et al. (2018), examined the gover­
nance framework of DAOs in relation to decision rights, accountability
and incentives, by illustrating a DAO case study- the Swarm City case.
They emphasize that the emergence of the blockchain economy requires
a rethinking of governance. Decision rights in the blockchain economy
will be more decentralized than in the digital economy. Incentives play a
crucial role in the blockchain economy. Incentives are vital factor for
eliciting desirable behavior from those who develop, maintain, and use
the decentralized applications, they are also critical in ensuring that the
underlying blockchain infrastructure functions properly (Beck et al.,
2018). Incentives are necessary to achieve the consensus that forms the
backbone of the blockchain economy (Murck, 2017). For example, re­
cords that form the foundation of the blockchain economy are not only
kept in a decentralized manner, but also decided upon in a decentralized
manner. Crypto-tokens can be used as an incentive and a value unit that
an ecosystem creates “to self-govern its business model, and empower its
users to interact with its products, while facilitating the distribution and
sharing of rewards and benefits to all its stakeholders” (Mougayar,
2017).
Concerning the early studies related to crypto-tokens, they focused
mainly on the notion of volatility and the exchange rates of the prices of
cryptocurrencies (e.g., Bolt & van Oordt, 2016; Cong, Li, & Wang, 2018;
Folkinshteyn & Lennon, 2016); on the mechanisms of valuing and
investing in crypto-assets, in comparison with fiat currencies and com­
modities (Kim, Sarin, & Virdi, 2018); on the popularity of crypto and the
reasons of its adoption in emerging markets (e.g., Carlson, 2016); on the
crypto features that increase or impede its adoption (e.g., Ciaian, Raj­
caniova, & Kancs, 2016; Folkinshteyn & Lennon, 2016;); the security
and privacy measures in crypto adoption (Fabian, Ermakova, Krah,
Lando, & Ahrary, 2018); and on the reasons of adoption by retailers (e.
g., Jonker, 2018) and by consumers (e.g., Albayati, Suk, Young, & Rho,
2020).
Existing research on crypto-tokens and trust from the end-user
perspective is very scarce and focuses mainly on a limited number of
variables in relation to the construct (Arli, van Esch, Bakpayev, & Lau­
rence, 2020). For example, Marella et al. (2020) have identified tech­
nological attributes that contribute to creating trust among the users' in
the cryptocurrencies domain, based on the technology trust model
proposed by Lankton, McKnight, and Tripp (2015), where they focus on
three distinct trust constructs: functionality, reliability and helpfulness.
Users consider the risks of privacy, security, loss of money to be the most
anxious concerns related to cryptocurrencies (Albayati et al., 2020).
Blundell-Wignall (2014) argue that cryptocurrencies may shift the basis
of trust, in that a trusted third party is rendered unnecessary by the
technology. Even so, it leaves open the question of whether potential
adopters will trust the technology itself (Sharma, Barua, & Whinston,
2019). The emerging cryptocurrency literature has assumed that hash­
rate (i.e., processing power) is a driver of trust (Pagnotta & Buraschi,
2018). By contrast, Sharma et al. (2019) demonstrate empirically that
trust among users is driven by (1) technological progress, as exemplified
by GitHub activities and (2) network effects, resulting from the belief
and expectation that other users will also adopt the cryptocurrency.
Bitcoin, in particular, is now progressing from being a curious
“collectible” to a store of value, underpinned by users' trust in its
deflationary properties. This is exemplified by large institutional in­
vestors (e.g., hedge funds and family offices) increasingly allocating a
portion of their portfolios to Bitcoin. In the context of private money,
Marimon, Nicolini, and Teles (2012) argue that commitment of the
supplier builds trust among the users. Higher levels of development
activity on GitHub may act as a signal of commitment of those who are
helping improve the technology, which, in turn, enhances trust among
the current and future adopters of a particular crypto-token.
Table 1 presents some key examples of research on trust toward
cryptocurrencies, or crypto-tokens applications.
As shown in Table 1, while the existing literature brings insights into
the drivers of trust, it does not consider the holistic contributors to trust
E. Toufaily Digital Business 2 (2022) 100041

Table 1
Key Insights on Trust Toward Cryptocurrencies.
Author (s) Objects of trust in the Key insights on trust toward blockchain
blockchain ecosystem

Steinmetz et al. (2021)
Albayati et al. (2020)
Marella et al. (2020)
Rehman, Salah, Damiani, and
Svetinovic (2020)
Ooi et al. (2021)
Arli et al. (2020)
Sharma et al. (2019)
Mendoza-Tello, Mora, and Pujol-
López (2019)
Sas and Khairuddin (2017)
Folkinshteyn and Lennon (2016)
Cryptocurrencies
Cryptocurrencies
Bitcoin-related technologies
Cryptocurrency ecosystem
Cryptocurrency – Bitcoin
Cryptocurrencies
Cryptocurrencies
Cryptocurrencies
Cryptocurrency-Bitcoin
Blockchain technology;
Bitcoin as a cryptocurrency
A major driver of the ownership of cryptocurrencies is the perceived trust toward them. The effects of
knowledge about cryptocurrencies and trust are greater on current ownership than on previous ownership.
Trust is more strongly affected by knowledge about blockchain than by knowledge about cryptocurrencies.
Governmental support, in terms of regulations and monitoring, user's experience and knowledge, as well as
social influence, in terms of community use encourage user's trust toward blockchain-based applications.
Eleven different attributes related to functionality, reliability and helpfulness of blockchain, wallet and
exchange platforms are significant in creating and maintaining users' trust in Bitcoin.
A detailed taxonomic analysis of trust issues in the cryptocurrency ecosystem is presented, including price
manipulations and volatility, insider trading, parallel and shadow economy, reputation systems, growing
centrality, token economy, governance and regulation, design and usability, privacy and security.
Transaction procedures, security statement and perceived security have a significant positive effect on
perceived trust, which in turn has an impact on Bitcoin use.
Knowledge of cryptocurrencies, trust in government, and the speed of transactions are the main factors
contributing to consumers' trust in cryptocurrencies.
Technological progress and network effects are the sources of trust, demand, and value for cryptocurrencies.
Perceived trust, perceived risks and perceived ease of use are not strong predictors of the intention of using
cryptocurrencies. However, the strength of their effects on the intention to use cryptocurrencies is mediated
by perceived usefulness.
Decentralization, deregulation, miner's expertise, as well as transparent, easy and low costs transactions are
trust facilitating factors. The main challenge for trust is the risk of insecure transactions resulting from
dishonest counterparties.
Transactions costs, high anonymity and privacy, learning spillover effects, infinite divisibility and no
inflationary pressures are Bitcoin features that may facilitate its use as a currency.

in crypto-tokens from the consumer's perspective. The individual char­
acteristics of the investor or crypto holder, the macro-environmental
drivers- other than regulations and jurisdictions- the features of the
decentralized applications in relation to trust are not thoroughly
examined in the existing literature. In our paper, we seek to fill this gap
and to propose a general and a data-driven conceptual model of the
drivers of trust.
3. Research design
3.1. Method and sampling
An exploratory research design based on qualitative data has been
selected, given that the study explores the factors that can impede or
build trust toward crypto-tokens, from the end-user perspective. A
qualitative approach helps to understand the interrelationships among
the various drivers and challenges of trust. An exploratory research is
also justified to identify new theoretical constructs, develop a new
conceptual framework, and contribute to advancing research on crypto-
tokens trust and adoption (e.g., Miles & Huberman, 1994). As our pur­
pose is to design thoroughly a holistic model that captures most di­
mensions that can impede or build trust toward crypto-tokens, and not
only to test some characteristics of the technology, a qualitative research
design is justified.
Semi-structured interviews were conducted in English with different
stakeholders from the blockchain and cryptocurrencies ecosystem in the
Middle East and North African (MENA) region. Two rounds of interviews
have been completed. The first round of twenty-seven interviews were
conducted from June of 2019- until March 2020 (before the pandemic).
The second round of interviews (fourteen interviews) has started in
March 2021 and ended in September 2021. In August 2022, four addi­
tional experts in blockchain and cryptocurrencies have been interviewed
to discuss, validate, update as well as consolidate the findings of the first
and second rounds. In total, forty-five participants were interviewed,
tape-recorded and transcribed and formed the final sample for this study
(see Table 2). Following the advice of Miles and Huberman (1994), a
purposeful sampling technique to identify the interviewees in the
cryptocurrencies ecosystem was used. The respondents in our sample,
are composed of users who have knowledge of blockchain and its
characteristics, and are consumers of decentralized applications (DApp)
where crypto-tokens are integral part of the application. As crypto-
tokens are the principal way that consumers and investors can interact
with DApps and blockchain technology, respondents have been asked
about their experience with crypto-tokens, the decentralized application
and blockchain technology in general. The interview guide was
composed of four main sections that allowed the author to acquire the
necessary information: 1/ the drivers and hinders of trust and adoption
of crypto-tokens, 2/ the technological, environmental and individual
factors related to trust, 3/ the motivations to trust and adoption of
crypto-tokens and 4/ the strategies to build trust toward crypto-tokens.
Most of the respondents in the sample are male (87%), 36 years old
on average and have an average of 6 years of experience in their in­
dustry. It is important to mention that all respondents are holders,
traders, or investors in crypto-tokens.
3.2. Data analysis
The study adopts a theory-driven approach of qualitative data
analysis, starting with the research question definition followed by the
determination of a priori constructs (e.g., environmental factors, tech­
nological factors), transformed into questions for the interview protocol.
We have derived the constructs from the literature on blockchain and
cryptocurrencies, which contributed to developing the preliminary
coding scheme. However, during the data analysis, we maintained an
“intimate connection with the empirical reality” (Eisenhardt, 1989) to
allow new relevant concepts to emerge from the data collected. We
followed an abductive reasoning in the analysis. Abduction suggests a
cycling back and forth between data and the literature (Langley, 1999).
In the first phase of the study, the initial coding scheme was based on
the objectives of the research (Langley, 1999). This phase resulted in an
open coding, an analytical process using the sentences and/or a para­
graph as a unit of analysis to identify the concepts, their characteristics
and scope (Strauss & Corbin, 1998). In the second phase, we grouped the
codes and linked them to categories. This step is the starting point for
building the explanation and identifying the main categories of trust
toward crypto- tokens applications. Finally, we arrived at plausible ex­
planations of the findings supported with examples of the most relevant
quotes extracted for each code (Langley, 1999). The outcomes of the

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Table 2
Profile of the respondents.
Respondent Age/ Position Company Years of experience in their current industry/
Gender job

R1 50/male Branch manager Financial institution 12

R2 40/male Sales executive Financial institution 5
R3 38/male Relationship manager Real Estate company 4
R4 54/male Regional Sales manager Supplier of Industrial and consumers office 4
products
R5 36/male Relationship manager Financial institution 8
R6 43/male Wealth counsellor Financial institution 11
R7 36/male Principal Sales consultant Big Tech company 8
R8 50/male Chief Financial Officer Automobile Trading Company 12
R9 30/male Director International Bank 10
R10 28male Financial analyst Consultancy/ auditing 2
R11 30/male Head of Consumer management Real Estate holding company 5
R12 24/male Founder Entertainment and Event planning company 2
R13 27/male Founder Crypto start-up 6
R14 26/male Advisor/Technology development Trading company 4
R15 27/female Senior Research Analyst Governmental office 1
R16 35/male Venture capitalist in BC-based startups _ 6
R17 − /male Assistant professor of Finance University _
R18 59/male IT solution Architect Big Tech company 20
R19 − /male University professor of Finance University 3
R20 − /female University professor of Finance University 4
R21 32/male Crypto-Investor Bitcoin, Cryptocurrency & Altcoins –
R22 29/male Territory Sales Manager Big Tech company 5
R23 22/male Graduate student – –
R24 56/female University professor University 20
R25 41/male SR. Manager-private banking Financial institution 18
R26 36/male Relationship manager Financial institution 4
R27 21/male Student University 3
R28 20/male Student University 2
R29 29/male Head- Business Development Manager Flight support services 4
R30 26/male Head of marketing- Digital Agency Graphic company 3
R31 52/male Senior director Trading company 17
R32 34/female Head of Finance department Retailing Mall 6
R33 38/female Bitcoin, Cryptocurrency Investor and Bitcoin, Cryptocurrency & Altcoins 5
Advisor
R34 29/male Manager Real Estate company 4
R35 37/male Processing controller Financial institution 4
R36 20/male Student University 4
R37 36/male Financial trader Exchange platform 6
R38 23/male Project manager – 3
R39 34/Female Relationship officer Financial institution 7
R40 32/Male Branch manager Exchange company 10
R41 − /Male Managing director Investments company 15
R42 62/Male Founder and CEO Founder of a blockchain-based start-up 7
R43 40/Male Professor of Finance University 5
R44 36/Male Professor of visual art/ start-up founder University/ Blockchain- based start-up 7
R45 52/Male Managing director Technological company 10

analysis were interpreted with reference to the literature. 4. Research findings

For validation of the findings, four additional experts (R42 to R45),
who are themselves holders of crypto-tokens, have been interviewed to
check the reliability and internal validity of the findings. Definitions of
the categories and a list of all codes have been presented to the experts
and they have been asked to associate the codes to the categories,
ensuring category reliability. The experts have also ranked the codes by
their importance to the respective categories and to the construct of trust
toward crypto-tokens.
Moreover, we have asked three respondents who participated in the
second round of the interview process to review the findings and express
whether our interpretations seem to be representative of their beliefs.
The purpose is to ensure that we have consistency in coding and pro­
cessing the same data- the interjudge reliability (Strauss & Corbin,
1998). We also triangulated the findings with the received literature to
support our codes, categories and interpretations, to increase the legit­
imacy of our conceptual model and to ensure that the internal validity of
our research is supported.
In this section, we present the findings of the interviews which are
grounded in the received literature. We categorize the findings into four
clusters of factors (codes) that can determine or hinder trust toward
crypto-tokens. The main four categories derived from the analysis are:
1/ the investor/end-user characteristics, 2/ the DApp characteristics, 3/
the macro-environment characteristics, and 4/the blockchain technol­
ogy features.
4.1. Individual characteristics (i.e. investor/ end-user)
The crypto-tokens consumers or investors' level of knowledge, edu­
cation and experience in the crypto market, their perceived value and
benefits from crypto-tokens, perceived risks and challenges, and their
level of disposition to trust have been mentioned as determinants of trust
toward crypto-tokens applications.

4.1.1. Level of technical knowledge, experience and education

When consumers have limited knowledge of a product, their trust in

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the product and the brand is also likely to be limited (Doney & Cannon,
1997). When individuals gain sufficient knowledge, they are more likely
to be persuaded to make a judgement, and ultimately a decision to adopt
or reject an innovation.
User's technical knowledge and education about blockchain and its
associated DApps have been highlighted different times as a driver or a
hinder of trust toward crypto-tokens. “Trust toward blockchain and mainly
token investment is hindered by the lack of knowledge of the operating
decentralized platforms, thus creating fear in regards of intangible properties
of cryptocurrencies. The lack of technical knowledge on how it operates, its
consensus systems and protocols is a big hinder to trust” R1; “Being your own
bank sounds cool, but comes with a lot of responsibilities. If you lose your
wallet or private keys, it's gone forever. Even if crypto allows you to take
control of your security, you need to have to a good knowledge to do it and not
lose your investments” R13.
Sas and Khairuddin (2017) indicated that Bitcoin users have limited
knowledge of how the technology works, and is the reason for low
perceived security and trust in Bitcoin. According to a bank relationship
manager in our sample, “an active education and freemium promotion
method can increase the trust and the adoption of crypto-tokens by con­
sumers. Also active usage by merchants worldwide can also lead to a faster
adoption. It is similar to online payments” R5. Our results are consistent
with Ostern (2018) who has identified different personal factors that
affect blockchain trust, namely: level of knowledge and experience,
personal innovativeness, technical understanding, curiosity, and
learning capabilities. Terminological ambiguities related to blockchain,
concept proliferation, technological determinism and conceptual in­
consistencies are restraining technology applications (Ostern, 2019).
Not all DApp users may be able to follow and comprehend the complex
technological developments closely to decide to trust or not the appli­
cations and their tokens.
Rosenberg (1972) discuss that one of the determinants to accelerate a
technology adoption by consumers is the development of technical skills
among users. There is “ a learning period, the length of which will
depend upon many factors, including the complexity of new techniques,
the extent to which they are novel or rely on skills already available”
(Rosenberg, 1972). To accelerate the adoption of distributed and
decentralized applications (DApp), Witherspoon (2017) suggest that
developers of DApps need to abstract away the technical skills required
for the adoption, offer the whole product (i.e., the distributed applica­
tion and its token) in a simple and easy way as well as propose its
complementarities from the beginning (i.e. accessory services that help
enhance the fluidity and usability of the DApp). Solutions on block­
chains should be simple and support users across platforms.
For Steinmetz et al. (2021), trust in crypto-tokens is strongly affected
by the level of knowledge about blockchain, with younger users finding
crypto-tokens more trustworthy than older users.
4.1.2. Perceived value and benefits
Different benefits have been mentioned by our respondents that in­
fluence their trust and adoption of crypto-tokens applications. Some
benefits are associated with blockchain technology features, while
others are related to the economic, monetary and political context of the
consumer such as the level of inflation in the country where they reside:
“Cryptocurrency is a currency that is not exposed or at the mercy of any
political or government influence so it is only managed by individuals who are
in full control of its volume as well as the levels of transaction. Any other
currency can get impacted by the economic situation, the political situation of
a country, it gets exposed to war, exposed to risks of many more instances,
while in crypto you don't have this as it is global and is controlled by in­
dividuals. It is safer and more comfortable than any other currency” R8.
Decentralized applications with interesting value and benefits to
consumers are more likely to be trustworthy (e.g., Collections of Non-
Fungible Tokens (NFTs) are more relevant to consumers and creators
than organizations). Respondents have mentioned different benefits that
can affect trust toward crypto-tokens. We code them into three distinct
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constructs, following Marella et al. (2020) and Lankton et al.'s (2015)
categorization: Functionality: Lower transactions fees, borderless tech­
nology, fraud reduction, instant payments, lack of transacting barriers,
transparency, global market, efficiency and easiness to transfer money
without involving banks, easiness to carry crypto-tokens through an
app; Helpfulness: profits, high return on investment; financial inclusion
of the unbanked; Reliability and security: prevention of fraud as crypto-
tokens transactions cannot be reversed or counterfeited, avoidance of
identity theft and accessibility to everyone in public.
Examples of representative excerpts of these benefits are: “ People
adopt tokens as they believe it is safer and faster way to pay one another, as
well as it reduces transaction costs, along with the value of the token that can
rise. So it may be seen as a good investment and can have high and quick
returns” R28; “Blockchain and cryptocurrencies can help financial inclusion
for around the 2 billion persons who have access to Internet connection but
have no access to the traditional money exchange systems such as debit card,
credit card due to various eligibility criteria” R5.
The findings of Ooi et al. (2021) reveal that perceived benefits and
perceived security plays a key role in user's trust toward Bitcoin, sug­
gesting that increasing cryptocurrencies security could lead to increase
trust for users. The higher the perceived value and benefits, the higher
consumers' trust in crypto-tokens. According to Srinivasan (2021), “the
long-term thesis for crypto remains unchanged: decentralization, privacy,
programmability, seizure-resistance and censorship-resistance…these are the
secular drivers of adoption”. Likewise, our findings corroborate the results
of Sas and Khairuddin (2017) and Marella et al. (2020).
4.1.3. Perceived risks and challenges
Different challenges and risks are cited by our respondents in relation
to crypto-tokens. Technological issues, government regulations, ano­
nymity, fraud, scams and thefts are among the risks mentioned by our
respondents: “Cryptocurrency is often associated with money laundering,
financing of criminal activities, investment bubble and Ponzi scheme most of
which is due to anonymity characteristics and there aren't many regulatory
policies regarding this” R5.
The lack of clear frameworks and government regulations to protect
consumers and investors in case of fraud has been discussed by our
sample as a main challenge to build trust: “Technological issues and
government regulations are the major barriers faced by crypto-tokens. No
central authority behind it and unidentifiable users are also affecting trust
and are barriers to the adoption”R37; “The barrier to trust in crypto­
currencies is that there is no governmental governance to control it” R13;
“The fact that blockchain effectively implements a decentralized security
model does not obviate the need for legal and regulatory involvement” R22.
Tokens volatility was also discussed as a major challenge to build
trust and adoption: “The volatility of the markets which has led to loss in
value of investments, and safety of wallets are a big concern to many with
fears of hacking and value loss. All these factors undermine trust” R3; “The
main challenge to trust in cryptocurrencies is this fluctuation in value” R30.
To address the issues of price manipulations and high volatility, a
few alternate stable coins (e.g., Maker's Dai, whose price is stable with
respect to the dollar. One Dai is always worth $1) were proposed by the
cryptocurrency community (Rehman et al., 2020) and are receiving
attention by users: “ to reduce tokens' volatility, peg them to real currencies
or things that have been historically recognized as a good store of value. This
helps facilitate the transition from former systems of value. This will help
increase trust as no one wants their investment to be worth nothing the next
day” R12; “ Crypto needs to be backed up by something valuable and stable in
order to determine its value and consequently increase its trust” R24. Stable
coins are powerful innovations that improve the interoperability, inte­
gration, and ultimately, the export of fiat currencies. They are also
getting systemically important in some markets (Messari, 2021).
Additional solutions have been proposed to reduce volatility such as
decentralized derivatives.
Cryptocurrency decentralized derivatives are financial instruments
that enable hedging against future possibility of price change. For
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example, Netherlands's blockchain company, DCORP, have created a
decentralized platform on the blockchain for derivatives contracts, that
investors can anonymously create options or futures contracts, without
the need for brokers: “Because the activity occurs on the blockchain it will
remain open and transparent, but it offers a layer of protection against
volatility and leads to an asset's stabilization” R11.
For some respondents, institutional investors and government in­
stitutions should play a role in stabilizing the fluctuance of crypto-
tokens prices: “Individuals have limited means, they cannot bring the cur­
rency to stability. It is the role of merchants, organizations, governments who
have huge capital influence to counter this speculation, offer incentives, or
have a sort of stabilization mechanisms” R8.
Privacy-by-design strategies whereby the sender identity is obscured
in order to stop the traceability of transactions is considered as a chal­
lenge to trust by some interviewees “Lack of traceability of the source of
the transaction made by crypto might lead to anonymous funding of terrorists
and illegal activities- the rise of underground markets, all this undermine
trust” R16. Privacy coins follow the privacy-by-design principle whereby
each possible privacy leakage issue is considered while designing the
cryptocurrency systems to ensure total anonymity of users and to break
the link between the senders and receivers. Notable privacy coins
include Zcash, Monero and Dash (Rehman et al., 2020). However, some
respondents consider the feature of anonymity and privacy as a chal­
lenge to build trust: “I think the main challenges to build institutional and
individual trust toward blockchain and cryptocurrencies is the application of
Know your customer, anti-money laundering and fraud reduction” R40.
Vendors acceptance has been mentioned as a challenge to trust: “ The
main reason people are not trusting and adopting crypto-tokens is that many
merchants are not accepting them as a legal tender or a valid medium of
exchange” R8. This finding is coherent with Sharma et al. (2019)’s who
argue that trust in a cryptocurrency involves expectations of whether
others will adopt the same. Recently, more businesses are accepting
crypto-tokens as a payment tool (e.g., Microsoft, Expedia, Ernst &
Young). The size of active user base has an impact on instilling trust in
crypto-tokens. According to Sharma et al. (2019), a larger user base may
(i) instill confidence in both speculators and users regarding the viability
and long-term value of Bitcoin, and (ii) make it feasible and convenient
for adopters to conduct business with more users.
Given the large number of hacks, thefts, and unresolved issues
related to transaction wait times and scalability, cryptocurrencies need
to undergo many technological enhancements before they reach any
stable state, which is happening at the time of the writing. As the
technology of crypto-tokens is evolving and robust, and sound techno­
logical foundation is manifesting itself in a reliable ecosystem of
adopters, reducing the risk of fraud and abuse by hackers (Werbach,
2018), and the development in the codebase of cryptocurrencies may
make the technology more trustworthy for the users (Rehman et al.,
2020; Sharma et al., 2019).
Our findings confirm existing studies (e.g., Albayati et al., 2020;
Folkinshteyn & Lennon, 2016; Rehman et al., 2020; Sharma et al., 2019)
that have explored the features of cryptocurrencies which may impede
their adoption. Absence of a legal tender attribute, relatively high fixed
costs of adoption, dependence on network externalities, absence of in­
stitutions enforcing dispute resolution and scams, deflationary pres­
sures, high price volatility and cybersecurity concerns are examples of
challenges that may impede trust and the use of crypto-tokens.
4.1.4. Disposition to trust
Another dimension mentioned by some users is their individual
disposition or propensity to trust, which is defined as a general will­
ingness to trust technology, institutions or others, that people may grow
up with it, or may develop it later in life (Mayer, Davis, & Schoorman,
1995). Researchers (e.g., Rotter, 1971) have found that in novel situa­
tions (such as crypto-tokens), people rely on their general disposition to
trust: “ I am not the kind of person who will trust easily, whether persons,
technologies, friends, or others. I can consider myself a laggard, and it is the
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same for crypto, I should wait and watch other experiences before I start
trusting the innovation” R38.
4.2. Decentralized applications (DApp) characteristics
Crypto-tokens provide the economic incentive mechanism for
decentralized applications, ensure the success and growth of crypto-
networks, and can have properties of currencies, commodities, secu­
rities, utilities, social or governance tokens (Grossman, 2018; Tönnissen
et al., 2020). Utility tokens, for example, are simply applications coins or
user tokens. They enable future access to the products or services offered
by the DApp. The characteristics of a DApp play a role in building
consumers' trust. Example of DApps, can vary from DeFi, to NFTs to
currencies. Compound is a decentralized lending platform of crypto-
assets with Comp as a governance token based on Ethereum block­
chain; Filecoin, for example is a protocol for renting space file. Filecoin
token will allow users access to its decentralized cloud storage platform.
OpenBazaar, is an example of a decentralized marketplace which aims to
perform similar services as Amazon or Ebay but without any central
control or commission (Hawlitschek et al., 2020).
Different features of the DApp have been mentioned by our re­
spondents as drivers or hinders of trust in the DApp and its token.
4.2.1. DApp unique value proposition (UVP)
A value proposition describes how a company's offer differs from that
of its competitors and explains why customers buy from the company
(Lindic & Marques da Silva, 2011). Customers seek benefits rather than
product characteristics or features. Value is created, from the customer
perspective, when the product or the service features such as design,
service or support match specific customer needs (Moorthi & Mohan,
2017). According to Anderson, Narus, and Van Rossum (2006), a value
proposition should be distinctive (i.e. superior to those of its competi­
tors), measurable (i.e. based on tangible points of difference), and sus­
tainable (i.e. valid for a certain time period) in order to provide focused
benefits that help solve target customers' problems.
The difficulties in delivering a distinctive value proposition that
satisfies consumers could hinder trust and adoption of DApps. As con­
sumers of DApp and crypto-tokens continue to grow, the differentiation
of these applications in the long-run, will be the features that are pur­
pose built for a specific community. For example, DApps, such as Alice,
their UVP resides in allowing making donations for social projects and
tracking the progress of the project over the blockchain; Steem is a
blockchain-based blogging and social media website, which rewards its
users with the crypto-token STEEM for publishing and curating content.
The challenge for these DApps that use crypto-tokens as an integrative
part of their business models is to increase the value of the tokens
(Tönnissen et al., 2020). Network effects are important in increasing the
value of tokens for all ecosystem participants.
Our respondents stressed the need for focusing on the benefits and
UVP for customers, when building applications to install trust and
adoption: “Compelling use-cases for DApps and cryptocurrencies that solve
problems that need solving would be a good place to start to increase trust”
R12; “I am a big fan of a Ripple XRP, because it has a solid idea behind it, a
concept in blockchain related to sending money between countries and solving
a liquidity problems. So there is a purpose and a unique value for it. Most of
the regulators are happy with it. They have no problem and there is a room of
growth” R9.
Blockchain technology have already demonstrated significant value
in terms of moving from centralized data management to decentralized
management of data, records, and transactions. These include financial
services, IoT, document management, intellectual property manage­
ment among others (Casino et al., 2019; Zhou et al., 2021). Additional
examples of tokens with UVP include the crypto lending platform Aave
or the decentralized exchange platform Uniswap, that have a fully
decentralized governance model with community voting.
Before implementing blockchain-enabled solutions and crypto-
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tokens, Casino et al. (2019) recommend to assess whether the block­
chain technology meets the needs of the use case and should be evalu­
ated in four main domain areas: required trust assumptions, context
requirements, performance characteristics and required consensus
mechanisms.
4.2.2. DApp Whitepaper
Whitepaper is also a driver of trust in a specific DApp. It is a docu­
ment created by the team that provides investors and consumers with
technical information about the project, including the concept, the
roadmap as well as how the project plans to grow and succeed. It can
provide insights into the working and long-term advancement of the
DApp and consequently establish initial trust, based on knowledge about
the project. The lack of a white paper is generally considered a red flag.
Additionally, whitepapers containing spelling mistakes, unnecessary
technical details or lack of basic grammar and punctuation are also red
flags: “When we have the assurance through a proper white paper, detailed
and carefully written and thought; a proper plan done that the cryptocurrency
is going to stay and to deliver value and is not just a fraud or a scam, I think
people will start show interest, trusting the crypto and investing in it” R9.
Since the white paper is the primary source of information, its
credibility is critical to safeguarding the interests of users and investors
as well as the long-term viability of blockchain-based applications. Our
finding is consistent with Feng, Li, Wong, and Zhang (2019), who in the
context of Initial Coin Offerings (ICO), show that providing technical
details in the white paper can be an effective way to signal the quality of
an ICO project.
4.2.3. Novelty of the DApp/token
It is clearly apparent that the novelty of the token and the idea
behind it, its originality in offering added-value and uniqueness in
solving a problem are a driver of trust: “You read whitepapers one after
another. Everyone is trying to blockchain something. They are using the
distributed ledger to cut out the middleman or they are trying to resolve the
problems of scalability, and interoperability in one way or another. Every­
thing starts to appear repetitive. Occasionally, you will come across a cryp­
tocurrency with an entirely novel concept that you can trust and invest money
on it. You will be stimulated again, only for a while because you soon realize
that there are many other barriers to overcome before that cryptocurrency
can come to fruition” R11.
In addition to the novelty of the DApp, the lock-up effects of tokens,
through staking process, are beneficial for DApps and for users. Some
blockchains allow users to lock-up their tokens for a period of time. This
process is called crypto staking, and it involves locking-up a portion of
consumers' cryptocurrency for a period of time as a way of contributing
to the blockchain network. Examples of blockchains allowing staking
are ETH of Ethereum (that moved recently from Proof-of-Work to Proof-
of-Stake), ADA of Cardano blockchain, and Solana or Sol. In exchange of
delegating their tokens, consumers can earn rewards, typically in the
form of additional coins or tokens, or by getting voting rights on the
applications. However locking-up tokens can also be risky since crypto is
volatile, consumers may need to pay fees, and the access to their hold­
ings will be stopped for a period of time.
DApps benefit from the tokens lock-up period, since it helps them
avoid liquidity problems (Becker, 2022) while new projects are still
building their supporting base. This process might be a driver of trust
toward the decentralized applications.
4.2.4. Design of the DApp/simplicity
According to Smits and Hulstijn (2020), the design decisions made
for the physical, informational, and logical layers of blockchain appli­
cations are influenced by the trust requirements. In turn, blockchain
design characteristics affect party-based trust, technology trust, and the
benefits and risks of adopting a DApp. For example, a peer-to-peer
lending application (e.g., BlockFi) that facilitates decentralized
lending will be more trustworthy if it is easy to be understood and is able
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Digital Business 2 (2022) 100041
to help users lending their cryptocurrencies in a simple manner.
Our respondents mention clearly that a simple and easy design of the
DApp will increase trust toward it: “the most important barrier is the lack of
technical simplicity, easy understanding in the design and proper knowledge
about cryptocurrencies and blockchain in general. People do not know how a
DApp works, and all the process that comes with it, which in turn encourages
people to avoid it and not trust it” R31.
User acceptance can guide the technical team to achieve a user
experience (UX) configuration design for the system. The customer can
decide to take the right interventions or not to maximize the effective
utilization of the DApp. According to Buterin (2022), “Today the Ether­
eum research team values simplicity much more - both simplicity of the final
design, and simplicity of the path to getting there. More appreciation of
pragmatic compromises”. A user-centered applications should be com­
bined with proactive communication about possible vulnerabilities of a
system and how they are being addressed (Zavolokina, Zani, & Schwabe,
2020). Good design, friendly interfaces, fast interactions and response
time impact the perceived ease of use of blockchain technology appli­
cations (Albayati et al., 2020) and consequently trust.
4.2.5. Credentials, reputation and competence of DApp founders
Studies have highlighted the competence, the consistency and the
quality of information and quality of delivery of the merchants as
important sources of trust (e.g., Lee & Chung, 2009; McKnight,
Choudhury, & Kacmar, 2002). These studies are related to trust building
mechanisms where the suppliers are firms with closed boundaries and
centralized structures. It is not the case with blockchain-based applica­
tions. Suppliers for most crypto-tokens comprise the community of de­
velopers working on the token's codebase on GitHub, the largest
platform for open source software. For example, in the case of Block­
stack DApp, the founders built their open source solution on top of the
Bitcoin protocol, enabling the community to help out by pointing out
mistakes and contributing on the code which again makes the solution
more secure since everyone helped findings errors (Bjørnstad, Krogh, &
Harkestad, 2017). Their founders have a lot of expertise and are well
recognized in the community. The robust experience of the founders
enabled them to be visionary and see the possibilities in the solution
while at the same time knowing what resources are needed to reach their
goals.
Bjørnstad et al., 2017, have found that visionary founders with
extensive prior experience with blockchain tend to start out with
problems that needs a technology like blockchain in order to be solved.
This process is found to give more valuable solutions than starting with
technology first. Reputation of founders, budget of funding, notorious
partners, background of founders, size of the community, and research
publications by the company are drivers of success of blockchain DApps
(Bjørnstad et al. (2017) and are consequently drivers of trust.
Some of our respondents highlight the credentials, competence,
reputation of the founders and developers of the blockchain-based
application as drivers of trust:“ There is a need to be a lot of trans­
parency in the whole thing. Crypto-tokens are beneficial, but there are so
many scams that is affecting its reputation. The team, the venture capitalists,
the developers and founders reputation, experience and competence are
important to consider before you trust the token” R24.
Qualified blockchain developers understand the blockchain archi­
tecture, underlying technologies and what it takes to implement the
individual blockchain components into a unified system. Blockchain
developers participate in designing blockchain networks and applica­
tions, analyzing existing systems and evaluating new technologies.
4.2.6. Communities and media around the DApp
Crypto-tokens have experienced a considerable amount of media
attention that would have played a great role in their continuous change
in price value, volatility, adoption and trust. A significant part of the
public awareness of cryptocurrencies and decentralized applications,
apart from the growth in their reported value, is due to the media, and
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their branding. Branding is an important element in the development of
trust and confidence in that the customer (or holder of the crypto-token)
may believe that the firm (the DAO operating the crypto-token) will act
in their best interests (Chaudhuri & Holbrook, 2001). Our respondents
claim the importance of media and the community in building or hin­
dering trust toward crypto-tokens: “When people start hearing in the
media, that this blockchain company did good things, this increases market
sentiment, builds confidence and trust toward the ecosystem” R29; “Media is
playing a role in destroying the reputation of tokens. There has to be some sort
of media involved to explain carefully the features and benefits of crypto, the
projects, the team and not only the scams or robberies that are very few” R23.
Although media has played a role in the negative perception of
crypto-tokens, according to Chainalysis (2021), illicit activity comprises
only 0.34% of crypto transactions, lower than incidence of illicit activity
in regulated financial services (Messari, 2021).
Ante (2021) analyzed to what extent Elon Musk's twitter activity
affects short-term cryptocurrency returns and volume. The author
identified highly significant abnormal trading volume following each
event or a tweet (for example, abnormal returns of up to 18.99% for
Bitcoin and 17.31% for Dogecoin across different time frames).
Although the author does not consider trust in the study, and that not all
tweets led to significant abnormal returns, the study clearly shows the
significant impact that social media activity of influential and well-
known individuals can have on cryptocurrencies. Most of our re­
spondents highlighted the willingness to rely on crypto-tokens, if media,
merchants, regulators and institutions support it.
Reddit is a good network to assess the community revolving around a
crypto project. If the developers are active and the community is
passionate, Reddit- as a medium and a community-is a positive driver of
trust: “I trust the Reddit community when I have to choose a crypto or a
project to invest in” R20. Telegram and Discord are discussion groups that
can provide also better insights into a crypto project, the team, and their
community. The number of subscribers is a good indicator for building
trust toward the token.
4.3. Macro-environmental characteristics
4.3.1. Regulations/legislative environment
According to Sharma et al. (2019), unregulated settings such as
cryptocurrencies, create their own challenges involving public trust in
the currency and accountability. Most of the experts in our sample
highlight the role of regulations in building trust in crypto-tokens: “The
lack of regulations hinders trust and adoption as some people feel that it
operates with jungle policies where you have no one to question in case you
lose your investments. Therefore, the environment is a limiting factor for
trust” R2; “Regulators will need to work with the finance community to make
sure and ensure that concerns are met, define standards and accountability in
case of dispute to increase the use of DApps and their coins” R41.
Consumer protection regulations are paramount to safeguard con­
sumer interests and ensure transparent and fair service levels on crypto-
exchanges (World Economic Forum, 2021). Regulators can identify
which of their consumer protection laws for existing financial products
and services are applicable to cryptocurrency products and services. For
instance, the responsibilities of a custodian of cryptocurrencies are no
different from its responsibilities for other financial instruments: safe­
guarding customer assets.
Regulatory frameworks regarding cryptocurrencies and crypto-
networks vary significantly across countries from an absolute ban (e.
g., China, Algeria), to implicit ban (e.g., Nigeria, Oman, Indonesia,
Kazakhstan) to the application of some Tax laws of the country on
crypto-tokens (e.g., Switzerland, Spain) and the application of Anti
Money Laundering (AML) laws and compliance (e.g. Belgium,
Switzerland, Japan) (The Law Library Of Congress, 2021). The Central
Bank of the UAE does not recognize yet cryptocurrencies as a form of
payment. However, it is working on a new regulation for retail payment
services that introduces the concept of tokens that could be used for
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Digital Business 2 (2022) 100041
payment purposes (The Law Library Of Congress, 2021).
Our finding corroborates with Arli et al.'s (2020) result that con­
sumers are more likely to trust peer-to-peer transactions if they are
regulated. Stakeholders from governments, public sector, private sectors
and founders of crypto-tokens should cooperate to come up with
worldwide standards and regulations. Create a framework and a struc­
ture for safety transactions, compliance, operational risks, and protec­
tion of consumers. According to Jamison and Tariq (2018), regulators
need to consider: (i) blockchain's strategic potential, rather than tech­
nical issues, (ii) use of the technology by regulators and industry, (iii)
automation of transactions with the use of smart contracts, (iv) oppor­
tunities offered by blockchain for AI and (v) change offered by block­
chain in shaping businesses (Jamison & Tariq, 2018). The other issue
crypto-tokens present to policy makers is the potential systemic risks
of banks operations. Bringing crypto-exchanges under banking regula­
tions may make more sense to policymakers than opening up crypto­
currencies to existing banks (Messari, 2021).
It is important to mention that few respondents in our sample,
perceive that regulators should not step into the crypto-tokens space, as
they might slow innovations and the development of DApps. Further­
more, from an ideological perspective, these same respondents consider
that the mission of crypto-tokens in relation to disintermediation,
freedom, redistribution of power, and libertarianism, does not fit with
regulators and governments: “ There is too much emphasis on regulators.
Too many regulations slow the innovation in the crypto space and kill the
mission of crypto” R42.
4.3.2. Level of trust in the monetary system
Several respondents perceive that cryptocurrencies have the poten­
tial to disrupt any existing monetary system, especially in countries
where the monetary system has failed to protect the most vulnerable
segments of the society: “It is especially useful in countries where the
economy control is weak as crypto do not need a government for it to stand. It
helps people to send and receive money in a fast way and at a lower cost”
R32; “People trust DApps and crypto because they see a promise in these
decentralized currencies after governments have failed them. They see a
promise in something that is completely independent from any restriction and
control. Cryptocurrencies are a way to circumvent the existing corrupt
monetary systems”R21.
In June 2021, Nayib Bukele, the president of El-Salvador announced
that the country will adopt Bitcoin as a legal tender, similar to the US
dollar, in order to increase the financial inclusion, economic growth and
the national wealth of the state, where 70% of Salvadorans do not have
access to traditional financial services (Webber & Szalay, 2021). The
adoption of Bitcoin for transactions will be based on trust toward the
cryptocurrency and its ecosystem. The fixed supply of Bitcoin, for
example, can render the cryptocurrency as a resilient, credible and
useful alternative for countries with vulnerable economic conditions,
such as hyperinflation. Some governments (e.g., El-Salvador) might
prefer to separate themselves entirely from existing monetary policy
tools by adopting cryptocurrencies (Gurguc & Knottenbelt, 2021). The
low level of trust in the existing monetary system of the country where
consumers reside, increases the probability of trust toward crypto-
tokens. We believe that this relationship, yet, needs additional
research to confirm its directionality.
4.3.3. Technological/IT Infrastructure support
One of the biggest challenges of crypto-tokens trust and adoption is
the ecosystem readiness, at technical, environmental and regulatory
levels. As one respondent has highlighted: “The technical infrastructure is
evolving but is still not that ready. That's why we saw a bit of slow adoption”.
According to De Filippi (2019), blockchain's trust-less infrastructure is
one the drawbacks of the technology, as it lessens the opportunities for
people to create strong social connections, community ties, and conse­
quently build trust.
According to our respondents, the infrastructure is a big challenge, as
E. Toufaily
well as the global consumption of energy in terms of transactions,
especially with Proof of Work consensus mechanisms. Indeed, mis­
conceptions regarding the technology need to be addressed to reveal its
value-creation potential (Angelis & Ribeiro da Silva, 2019; Marella
et al., 2020): “Lot of people are not technologically sound, or do not have
access all the time to the Internet and good computers and servers. I think the
technical part will affect the MENA region the most, but it will be widely
accepted. It's actually been studied that the MENA and others parts of West
Africa, are going to be the areas that used the most blockchain in the world,
because they serve the people really well” R29. This result is coherent with
Janssen, Weerakkody, Ismagilova, Sivarajah, and Irani (2020)’s finding
on the importance of infrastructure support in the adoption of
blockchain.
4.3.4. Ecosystem readiness/solid norms
In order to be trusted, crypto-tokens need to overcome cultural
resistance by the ecosystem, mainly market incumbents. It also need to
overcome the resistance to change the way transactions happen of both
consumers and companies (Janssen et al., 2020). Customers will need to
get used to the fact that electronic transactions are more secure, com­
plete and safe with crypto-tokens and merchants and payments pro­
viders should start accepting crypto-tokens in the payments processes.
Many macro challenges still exist and are affecting trust toward
decentralized applications and crypto-tokens. One major point that our
interviewees stated is that the mindset and the ecosystem is not ready for
widespread adoption. For this technology to be used by the masses there
is a need to have a change of mindset, and changes in the management of
companies that want to adopt crypto-tokens. In addition, there is a lack
of knowledge and practice about blockchain networks. Trust toward
crypto-tokens requires a lot of changes in the mindset of different
stakeholders: “You need companies to change, you need end-users to change,
you need regulators to change. So all this change takes time. Even when we
started seeing that digital wallets are coming to the industry, it took us time to
get used to the idea that we can pay online through our cards through adding
it to the phone. So imagine you are adopting a technology that hits everyone in
the value chain of the financial industry, whether it's the end user, the mer­
chant, the bank, or the regulator. So, the challenges are mindset change
management and the infrastructure in terms of technology. We're not there
yet” R35.
Knowledge related to technical aspects and governance of crypto-
tokens is essential not only to better understand the technology per se,
but also for mindset change, trust and adoption (Beck et al., 2018;
Toufaily et al., 2021).
4.3.5. Level of public awareness
Public awareness, level of knowledge and financial literacy of the
ecosystem, play a role in building or impeding trust toward crypto-
tokens. Indeed, misconceptions regarding the technology need to be
addressed to reveal its value-creation potential (Angelis & Ribeiro da
Silva, 2019).
As our respondents have mentioned: “A lack of public awareness of
crypto-tokens projects is a barrier to trust and mass adoption. Few consumers
grasp what cryptocurrency is, its advantages, its risks which can lead to a
hamper in trust and adoption” R11; “Action is awareness. People need to get
knowledge the same like we were talking about PayPal when it started. We
need to give information and knowledge that this transition, where we are
now, is in another form of technology, because technology keeps on changing
every decade” R33.
Educating society and ecosystem stakeholders about the implications
of crypto-tokens and decentralized applications is critical for building
trust and the development of innovative blockchain-based solutions:
“Education, building knowledge and awareness. We need to make sure that
we are transferring the right knowledge to the people who need it most and
who will benefit from it. If blockchain and cryptocurrency are being taught in
universities, people will be more likely to trust them and adopt them later”
R16. Financial literacy can help overcoming misconceptions. Knowledge
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Digital Business 2 (2022) 100041
and understanding of consumers must be improved.
4.3.6. Institutional acceptance /Network effects
Network effects or network externalities play an important role in
trust and adoption of crypto-tokens. Sharma et al. (2019) have found
that a larger user base instill confidence in both speculators and users
regarding the viability and long-term value of Bitcoin. Network effects
have been recognized as one of the defining features of peer-to-peer
platforms, and decentralized systems. As more individuals join the
platform, they enjoy more surplus through interacting with other users
because it is easier to find a trade partner (Cong et al., 2018). Jonker
(2018), based on a large representative sample of online 768 retailers in
the Netherlands, finds that the most significant barrier for crypto
acceptance by retailers is a lack of consumer demand, confirming the
effect of network externalities in a two-sided market.
Universal acceptance of crypto-tokens, a technology subject to strong
network effects, is seen as a considerable challenge by most of our in­
terviewees: “The main reason people are not trusting or adopting crypto­
currencies is that many merchants are not accepting crypto as a legal tender
or a valid medium of exchange, which making people staying away and
refraining from investing and using crypto” R13.“The biggest facilitators of
crypto would be e-commerce websites such as Amazon accepting crypto­
currencies as mode of payments” R22.
Facilitators to build trust and accelerate adoption are merchants,
associations such as chambers of commerce and social organizations.
Universities and medias play also a role as stakeholders for education: “It
is all about ensuring that the knowledge and understanding and operations of
crypto is being well spread across the society” R8.
Generally, three types of externalities/network effects are discussed
in the context of adoption of socially valuable technologies: (1) network
externalities: adopters care about how many individuals adopt the
technology, because there is a public good element in adoption; (2)
market power externalities: adopters with market power will care about
the adoption by others if early adoption implies some market power; (3)
learning externalities: early adopters may teach late adopters something
useful, as in the case of crypto-tokens, a technology of uncertain prof­
itability (Tucker, 2008).
According to Tönnissen et al. (2020), crypto-tokens enable commu­
nity of an ecosystem to achieve network effects, as they incentive the
early adoption of the crypto-token in order to reach a critical mass of
users. The role of the crypto-token in the token-based ecosystems is
different in the three archetypes identified by Tönnissen et al. (2020). In
the Pioneering (vision) model, the token is mainly used in exchange for
benefits with no special activity to increase the token value. However, in
the other two models (i.e., Expansion model and the Authority model),
network effects and the involvement of the stakeholders are paramount
in order to increase the value of the token (see Tönnissen et al., 2020).
4.4. Blockchain technology characteristics
Respondents argue that the characteristics of blockchain, the un­
derlying technology of crypto-tokens, play a role in enabling or
impeding the formation of trust.
4.4.1. Technical complexity
Swan and De Filippi (2017) discuss that blockchain technology and
cryptocurrencies are at the intersection of several disciplines, from
cryptography, computer science, to economics and game theory. Even
their basics are difficult to understand, both conceptually and techni­
cally. Such complexity is a barrier to trust and adoption of crypto-
tokens.
Our respondents have confirmed this perception of complexity: “ I
could not trust something that I do not understand. It is very complicated. It
took me time to understand the custodial versus non-custodial wallets, risks,
how to link a wallet, what is the technology, how not to be scammed, what
coins to trust. It is a complex process, and if you lack the knowledge, you will
E. Toufaily
sure not trust cryptocurrencies.”R8.
Decentralized applications are becoming more accessible to the
general consumer: “For example, a year ago, the process of accessing a DeFi
DApp could be quite cumbersome to a new user, now, a user can simply
download the app, scroll to the browser tab, and begin using a number of DeFi
tools such as Uniswap.” R21.
According to Zavolokina et al. (2020), understandability of the IT
artifact, reliability and information accuracy are drivers of trust toward
decentralized applications. User interfaces, soft factors, labels and in­
formation are trust supporting design elements for blockchain-based
decentralized applications.
Nevertheless, the literature has shown that blockchain layers still
have their own technical and non-technical weaknesses which can
obstruct trust building mechanism. Examples of these weaknesses are:
inflexibility of smart contracts in high uncertainties (Rehman et al.,
2020), Sybil attacks leading to false consensus (Antonopoulos, 2017;
Rehman et al., 2020), oracles vulnerabilities – untrustworthiness of
data, single point of failure, difficulty of identifying oracles and con­
necting smart contracts to them (Curran, 2020), and others.
4.4.2. Scalability
Scalability refers to the ability of the system to sustain performance
while growing and expanding, such as increasing the number of nodes,
storage requirements and the response time per transaction as the
network grows (Toufaily et al., 2021). “The main challenge for me is the
difficulty in the scalability of cryptocurrencies over the various industries such
as construction, manufacturing and healthcare” R15.
Scalability challenge of blockchain technology is attracting most
resources and mind shares from the developers community and is ex­
pected to be solved with second layer solutions. In fact, two of the main
issues that the Ethereum 2.0 upgrade is addressing are scalability and
gas fees. There are multiple protocols and solutions being considered
and integrated on Ethereum blockchain, but they remain an important
challenge if scalability is not solved.
4.4.3. Security and cybercrime
Although the use of a distributed ledger is a way to avoid invisible
manipulation, it is crucial for blockchain technology systems to have
cyber-protection in place, as cyber-crime is a high-level concern for all
market participants (Janssen et al., 2020). The fear of cyber-attacks and
scams is preventing consumers' trust in crypto-tokens. Even though
advocates of the technology argue that blockchain has increased cyber-
security, our respondents have diverse points of views regarding the
security of crypto-tokens transactions, and this also depends on their
level of knowledge of blockchain technology. For example, a sale
consultant at a big tech company argue that “ Many people still don't trust
DApps and tokens and consider payments through cryptocurrencies as non-
secure and have a high risk of scams” R7; while a manager director at
an investment company believes that: “People trust this technology as it is
highly secured through decentralized ledger platform and allows a reduced
cost of operations which makes a lot of business sense.”R41
4.4.4. Anonymity and privacy
Ostern (2018) found that the lack of intermediaries, anonymity of
transactions and the bypassing of the traditional banking system are
characteristics of the blockchain that rather leads to the feeling of
distrust toward the technology than to trust it. Some respondents sup­
port this finding, by stating that their losses in crypto is related to the
anonymity of the transacting party: “I have to admit it, I had lost a large
sum of money in cryptocurrency investment due to the cryptocurrency's
property of anonymity” (R9).
Casino et al. (2019) confirm that privacy and confidentiality are a
problem for blockchains, because information is stored on a public
ledger, even if several anonymization or encryption-based mechanisms
have been adopted to protect the confidentiality of the information.
Transactional privacy is a problem in blockchain data privacy.
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Digital Business 2 (2022) 100041
Businesses and individuals are concerned about the traceability of the
transactions and smart contract operations propagated across the
network.
However, anonymity and privacy features have a dual perceptions as
their benefits are large for consumers who frequently execute cross-
border payments such as remittances. Additionally, consumers who
value privacy and anonymity more, and those who are technologically
more adept are more likely to trust crypto-tokens confirming Bolt and
van Oordt (2016)’s research.
4.4.5. Disintermediation/ Decentralization
In the context of blockchain, disintermediation refers to the power of
removing intermediaries in the distribution networks (Bons et al., 2020).
Consumers put their trust in the blockchain nodes, codes, and smart
contracts rather than trusting intermediaries to validate transactions. In
this regard, blockchain technology creates an Internet of trust that
guarantees trust in transactions, the exchange of information, the right
data. However, Zamani and Giaglis (2018) suggest that, in reality, rather
than complete disintermediation, new types of intermediaries have
emerged and are playing a role in mediating blockchain-based economic
transactions. Wigand (2020) stresses that network markets will function
as a “form of reintermediation”, as to transact in the network will
require new intermediaries (e.g., cryptocurrency exchanges, wallet
vendors, mining facilities).
Ostern (2018) found that numerous features of the technology (e.g.,
decentralization, disintermediation) are identified to have two-sided
effect, which means they are perceived simultaneously as drivers and
hinders of trust formation. Our respondents confirm this finding: “One of
the trade-off for this decentralization and independence is that the user
should trust the code, which could be difficult” R37. In fact, decentralized
protocols are all governed by computer code and therefore subject to
human error. However, as one respondent mentioned: “Decentralization
will improve as governance tokens are distributed and begin to find a market
value” R9. Beck et al. (2018) mention that decisions rights are central­
ized at the beginning of the development of the DApp for an effective
system design, which is considered a necessary “benevolent dictator­
ship” and a prerequisite for decentralization later. Smart contracts might
allow for decentralized governance mechanisms, but the blockchain
economy at present continue to be characterised by a high degree of
centralized decision-making (Beck et al., 2018). For instance, in August
2022, the decentralized exchange (dex) Uniswap has censored 253
crypto addresses allegedly tied to government sanctions (Redman,
2022).
Nevertheless, the existence of new financial intermediaries albeit in a
different form might be fundamental to the attainment of trust in crypto-
tokens for the less savvy consumers. Intermediaries including crypto
exchanges platforms such as Binance, Kraken and Coinbase are likely to
provide trust and to earn revenue from providing value-added services
to users such as account management, fraud prevention and wallet/ac­
count recovery (Vaz & Brown, 2020). Claims that blockchain will
entirely eliminate institutional engagement and intermediaries are
exaggerated, since compliance with legal institutions will continue to be
necessary in the blockchain economy (Beck et al., 2018; Wigand, 2020).
5. Theoretical framework
Based on the results of the qualitative data analysis, we propose a
conceptual framework (Fig. 1) organizing the consumers' drivers and
hinders of trust toward crypto-tokens. This framework condenses all the
themes revealed from the findings into four core categories. The cate­
gories are related to the individual's characteristics, the decentralized
application (DApp) characteristics, the macro-environment character­
istics and the underlying blockchain technology characteristics.
Individual characteristics are factors that are related directly to the
investor or users' personal features that foster or hinder the formation of
trust, such as their level of knowledge of crypto-tokens, their education,
E. Toufaily
An Integrative Model of Trust toward Crypto-Tokens Applications: A Customer Perspective
Approach
Investor/End-User Characteristics
• Level of technical knowledge, experience and educaon +
• Disposion/propensity to trust +
• Perceived benefits/value + (e.g., fast transacons, ease of money
transfer, lower charges/fees, no transfer restricons, percepon
of beer alternave for fiat currency, novelty of investment)
• Perceived risks - (e.g., volality, security, frauds/scams, financial
loss, privacy, lack of consumer protecons, vendors acceptance)
Environmental Characteristics
Trust Toward Crypto-
• Regulaons/legislave environment +/-
• Level of trust in exisng monetary systems +/- Tokens
• Technological/IT Infrastructure support +
• Ecosystem Readiness/Solid norms +
• Level of Public Awareness +
• Instuonal Acceptance/Network Effects +
Adopon of Crypto-
Tokens
Fig. 1. An Integrative Model of Trust toward Crypto-Tokens Applications.
their general disposition to trust, their perception of risks and perception
of value. The DApp factors are related to the project behind the crypto-
token, to the team credentials and reputation, to the community behind
the token, the novelty of the project, the quality of its whitepaper, the
design of the dApp and its unique value proposition. These factors affect
the formation of consumers' trust in crypto-tokens. Likewise, the
blockchain technology-related characteristics are the drivers that can
build trust toward crypto-tokens, and are related to blockchain tech­
nology itself where some features can be a hinder for some users and
drivers of trust for other users (e.g., disintermediation, anonymity).
Users' assessment of attributes of blockchain reflects their beliefs about
the technology's ability to deliver or not on the promise of its objective
characteristics.
The environmental and external factors such as regulations, accept­
ability and network effects, technological development, cultural norms,
public awareness and the state of the monetary and political systems in a
specific country are contextual drivers of the formation of trust and vary
among countries and jurisdictions.
The proposed comprehensive framework has emerged as a result of
an interactive analysis back and forth between the literature review on
blockchain, cryptocurrencies and trust, as well as concepts emerging
from the data analysis that are specifically related to the crypto-tokens
features (e.g., scalability, security, externalities/network effects-
which are common in decentralized systems). Factors associated with
different categories are expected to create a particular cognitive effect
that is either positive (trust) or negative (distrust) on consumers and
consequently on their adoption of crypto-tokens. Several factors (as seen
in the figure) are identified to have a two-sided effects, which means that
they are simultaneously perceived as factors fostering or hindering the
formation of trust in crypto-tokens.
The framework can be used by policymakers, educators, exchange
platforms, DApp developers, and entrepreneurs to develop strategies
that face the hinders of trust, and cultivate on the drivers to build trust,
and create value with crypto-tokens and Web3.0. When trust is formed,
behavioral outcomes such as adoption will accelerate.
12
Digital Business 2 (2022) 100041
DApp Characteristics
• Project quality (UVP) +
• Novelty of the token +
• Whitepaper quality +
• Design of the DApp/simplicity +
• Credenals, reputaon and competence of the
DApp founders +
• Communies and media around the DApp +/-
Technology
Characteristics
• Technical Complexity -
• Scalability +
• Security +/ -
• Anonymity and privacy +/-
• Disintermediaon/Decentrali-
zaon +/-
6. Discussion and implications
Crypto-tokens and their underlying blockchain technology are hailed
in the literature as a trust-free networks or trustless systems that elimi­
nate the need to trust (e.g., Conway & Garimella, 2020). In this paper,
we argue that trust in crypto-tokens is not limited to the right func­
tioning of the code, but requires a variety of sociotechnical, individual
and environmental factors crucial for building it. Trust is not eradicated
in the blockchain networks, rather it is re-intermediated, layer by layer,
in a network of actors that operate and maintain the proper functioning
of the system (e.g., developers, miners, traders, investors, regulators). In
this paper, we propose a holistic framework that considers the factors
that facilitate or hinder the creation of trust in crypto-based decentral­
ized applications from the perspective of customers. As trust describes a
relationship that depends on the characteristics of the trustee, the trustor
(i.e., technology or peers), and the context of the interaction in a situ­
ation characterised by uncertainty and vulnerability (Mcknight &
Chervany, 2001), we argue that trust will depend on the individual,
environmental, and technological factors of crypto-tokens applications.
De Filippi (2019) argues that human-technology trust relationships must
be understood as fundamentally social. In fact, our research has shown
that consumers perceive crypto-tokens as a technology that achieves
fairness, since it allows for financial inclusion, minimises restrictions
and control, and allows to attain economic goals beyond the traditional
financial system.
Crypto-networks, through their respective tokens, have the potential
to catalyze trust, governance and cooperation at a remarkable scale.
However, to be able to achieve their goals, create value, and bring the
shift away from institutional trust, there is a need to ensure that a set of
dimensions, related to the technology, environment, application and the
user are considered and carefully comprehended. According to our
findings, many factors, discussed by the users play a dual role in the
process of building trust. In particular, blockchain-related factors that
were stated, by some users, to negatively influence the formation of trust
in crypto-tokens (e.g., disintermediation, decentralization and ano­
nymity of users) are factors that are typically emphasized by blockchain
E. Toufaily
advocates as being especially beneficial (Ostern, 2018). Although
crypto-exchanges platforms, developers of DApps, wallet vendors are re-
intermediating the economic transactions and Know Your Customer
(KYC) are performed on crypto-exchanges, these platforms still have to
guarantee to users simplicity of design, confidence and security of
transactions, low fees on transacting, and protection from market
volatility and cyber-scams. Creating crypto-networks that guarantee
security and privacy of the users, platforms that are free from issues such
as hacking or transfer failures, that ensure the protection of personal
data, may increase trust and attract adopters. Accountability and
traceability of core developers and transaction validating nodes may
also be a crucial component that builds trust and, as a response, DApps
adoption. Regulatory frameworks are needed to standardize and provide
trust to the crypto-tokens ecosystems. Developing appropriate regula­
tory frameworks and use of sandboxes, educating regulators, the media,
and other relevant actors (e.g., students, financial services sector) about
crypto-tokens are also necessary to drive trust as our research has
revealed.
According to Zavolokina et al. (2020), trust in the capabilities of the
technology to fulfill its purpose, is a prerequisite for trust in blockchain-
based applications. However, if crypto-tokens are to be widely accepted,
they require more than just an improvement in the scalability and se­
curity of the technology performance. For crypto-tokens to be successful
as a form of exchange, investment or mode of payment, they need to
establish an environment of trust and confidence, which we argue will
involve different multi-dimensional drivers. More precisely, some fea­
tures of the DApp can engender trust and might lead the crypto-token to
become a “financial asset” traded and held by a significant number of
adopters. These characteristics should consider an assessment of the
team and their credentials, the community behind the token, the value
of the project, the design of the DApp, the unique value proposition of
the project and its perception of novelty.
Consumers should also verify the state of regulations in terms of the
legitimacy of investing in crypto-tokens, the legislations in place to
protect them from any potential scams, the level of awareness and
digital financial literacy, the social and cultural acceptance of crypto-
tokens. As there are flaws in the market, trust needs clear regulations.
Regulations should be at the global level, not only at the country base.
Likewise, consumers should consider the user base of a specific crypto-
token (i.e. network effect) as a sign of trust, as well as the level of
acceptability of the crypto-token by merchants and institutions. From an
institutional perspective, incentives should be given for acceptance. For
instance, some cities and some companies are gaining from the socio-
economic value of blockchain and cryptocurrencies. For example, the
city of Vienna, gives incentives though discounts or a higher tax return
per year, for citizens and firms that are trusting and using the city utility
token.
Our findings corroborate with existing literature, that trust in crypto-
tokens involves expectations of whether others will adopt the same (i.e.,
network effect) (Sharma et al., 2019), that governmental support, in
terms of regulations, user's experience and knowledge in conducting
crypto transactions as well as social influence, in terms of community
use, encourage user's trust toward blockchain-based applications
(Albayati et al., 2020). Moreover, suppliers of most crypto-tokens
comprise the community of developers working on a token's codebase
on GitHub, nevertheless, not all DApp users may be able to follow and
comprehend the complex technological developments closely. As the
literature has shown, technology complexity plays a negative role in the
formation of trust (e.g., Arli et al., 2020; Marella et al., 2020). Our
research confirms this finding. Consequently, creating a glossary for the
terminology and its evolution with applications and examples, to in­
crease public understanding and knowledge, might increase trust.
The ecosystem of decentralized applications is richer than ever
before, driven by DeFi, NFTs, and other use cases. As crypto-token
economies are becoming more popular, existing platforms will begin
to implement their own tokens (Pazaitis, De Filippi, & Kostakis, 2017).
13
Digital Business 2 (2022) 100041
In the future, collaborative networks like Airbnb may begin utilizing
crypto-tokens with features that go beyond transactions and payments,
including microlending, investment, and incentives for nodes to support
the platform (Zutshi, Grilo, & Nodehi, 2021).
6.1. Implications for research
The implication of this paper to the academic research is its contri­
bution to understanding the drivers and hinders of building a consumer
trust layer on top of the ‘trustless” technical layer presented in the
literature. Understanding the different drivers and hinders of trust
building mechanisms from a holistic perspective will allow to develop
meaningful applications of blockchain and build trust in the crypto-
tokens economy. We consider the socio-technical dimensions that can
impact consumer's trust. With crypto-tokens gaining momentum
worldwide, the findings of the study provide important insights for
scholars, who are interested in crypto-tokens based applications. Un­
derstanding the core categories and the themes identified in the
framework is clearly a mean to build trust and attract more users to the
crypto space. Our model highlights the need to understand the indi­
vidual, technological, environmental and use-case features which shape
the way blockchain-based applications can be trusted. Higher trust ul­
timately promotes acceptance of blockchain applications.
6.2. Implications for practice
From a practical perspective, our work can be used by managers and
DApp developers, to help them understand the broader implications of
trust from the consumers' perspective. It allows them to create value and
increase their chance of building successful decentralized applications
by focusing on trust drivers, and by building strategies to face the
challenges perceived by users for successful adoption. Although the
framework proposed cannot be used as a blueprint, it can be used as a
tool to boost developers creativity who are seeking consumers accep­
tance and trust in their products. It can be used in workshops, for
example, to explain the best strategies of trust building mechanisms
toward DApps, based on the findings. Our work can be used as a starting
point, by practitioners, entrepreneurs and policy makers who are
interested in crypto-tokens based applications, as it can be adapted and/
or extended depending on the specific use-case and business model. Our
work can support governments and regulators in adapting regulatory
frameworks through a better understanding of crypto-tokens trust and
adoption.
7. Conclusions, limitations and further research
The main focus of this paper was to explore and identify the factors
that facilitate the creation of trust in crypto-tokens decentralized ap­
plications (DApp) from the perspective of the consumer. Our contribu­
tion to the academic research resides in proposing a multidimensional
and holistic data driven conceptual framework. The model captures the
different dimensions that affect consumer's trust toward crypto-tokens
applications. The study has some limitations which future research
can address. Although the framework is holistic and is driven from
qualitative data, it has not been empirically tested though quantitative
methods to highlight, with more precision, the weight and direction of
each factor identified in relation to trust. Moreover, although we have
validated the model with additional four experts who have reviewed the
codes and the categories (i.e. individual, environmental, technological
and use-case/ DApp characteristics), and we have compared the findings
with secondary data from the received literature to reduce any risk of
common bias method, the results still rely on one single method of data
gathering: semi-structured interviews. Future research needs to test the
proposed framework in different contexts to examine its level of
generalizability and replicability.
The paper identified factors which affect trust toward crypto-tokens
E. Toufaily
applications, future research is still needed to provide strategies of the
drivers and solutions to the challenges of trust identified in the model.
The proposed framework shows the interrelationship between envi­
ronmental (e.g., regulations), technological (e.g., scalability), individual
(e.g., propensity to trust) and use case (e.g., simplicity and design)
factors and their relation to trust, consequently, it gives applications
developers, exchange platforms, technology enthusiasts and venture
capitalists a frame of reference when building blockchain-based appli­
cations. Future research should explore, refine and test these relation­
ships and expand the framework based on more practical evidence.
Moreover, in this paper we present key studies from the literature on
trust and blockchain and crypto-tokens to support the interpretation of
our findings. However, our research does not provide a systematic view
of this existing literature on trust and crypto-tokens. It did not capture
how the field with this specific theme has evolved. Future research
should consider the advancement of the state-of-the-art in this domain,
through a systematic approach, and recognizes more the emerging
trends in the field of trust and crypto-tokens applications.
This study produced useful insights, which would be of interest to
academics, practitioners and consumers. We hope that further research
will extend our empirical work on trust in and adoption of crypto-tokens
applications to duly acknowledge the technology's foundational nature.
Declaration of Competing Interest
None.
Data availability
Data will be made available on request.
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