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The smooth functioning of the modern world economy would be unimaginable without financial intermediation. Whether one is discussing market-based economies with developed capital markets or bank-based economies that rely more on borrowing from banks for economic development—financial intermediaries such as banks and financial services firms are always present (Beck et al. 2010). Although classical financial economics posits that financial intermediation has no real effects per se (Allen 2001), the very large body of academic research on this field proves its importance (Leland and Pyle 1977, Gorton and Winton 2003). Banks and the financial services industry in general seem to be irreplaceable when it comes to reducing transaction costs and asymmetric information frictions by providing services such as delegated monitors, information producers, liquidity providers, and commitment mechanisms.
It has been argued that the innovation process should lead to the creation of new financial systems where intermediaries do not play such an important role—a process termed disintermediation in the literature (Allen and Santomero 2001, Tufano 2003). Rapid technological changes, internationalization, and the advent of the Fintech in the financial industry, along with overregulation and its inability to adapt to the ever-changing and more volatile financing needs of smaller borrowers, have led to previously unheard-of forms of innovative financing methods. These new methods, usually termed Alternative Finance (AF), allow for capital from financial markets to be funneled to corporate borrowers. This means they bypass or alter the conventional financial industry’s channels that were adversely affected by the ongoing financial crisis which started in 2007 (Allen et al. 2013, Block et al. 2018, Boreiko 2017).
Crowdfunding is the new AF method of funding start-ups by collecting funds from many investors. Having started as pure not-for-profit funds collection (donation-based) or prepayments for future product delivery (reward-based crowdfunding), crowdfunding turned out to be an appealing method for entrepreneurs or small enterprises to attract the needed seed capital (Ordanini et al. 2011). However, one of the main fundamental problems of crowdfunding is information asymmetry between lenders and borrowers or companies and equity investors (Vismara 2018). The original crowdfunding model envisaged a decentralized process without a financial intermediary. This mutated back to the basics, whereby the crowdfunding platform took back a vital role in assessing projects before admission and in ex-post monitoring of...