OUP accepted manuscript

2019 The Review of financial studies  
Blockchain technology provides decentralized consensus and potentially enlarges the contracting space through smart contracts. Meanwhile, generating decentralized consensus entails distributing information that necessarily alters the informational environment. We analyze how decentralization relates to consensus quality and how the quintessential features of blockchain remold the landscape of competition. Smart contracts can mitigate informational asymmetry and improve welfare and consumer
more » ... e and consumer surplus through enhanced entry and competition, yet distributing information during consensus generation may encourage greater collusion. In general, blockchains sustain market equilibria with a wider range of economic outcomes. We further discuss the implications for antitrust policies targeted at blockchain applications. (JEL C73, D82, D86, G29, L13, L86)
doi:10.1093/rfs/hhz007 fatcat:nlbsv3nnbrgapnzq7nnaudzjiu