Value Creation in Cryptocurrency Networks: Towards a Taxonomy of Digital Business Models for Bitcoin Companies

Cryptocurrency networks have given birth to a diversity of start-ups and attracted a huge influx of venture capital to invest in these start-ups for creating and capturing value within and between such networks. Synthesizing strategic management and information systems (IS) literature, this study advances a unified theoretical framework for identifying and investigating how cryptocurrency companies configure value through digital business models. This framework is then employed, via multiple case studies, to examine digital business models of companies within the bitcoin network. Findings suggest that companies within the bitcoin network exhibits six generic digital business models. These six digital business models are in turn driven by three modes of value configurations with their own distinct logic for value creation and mechanisms for value capturing. A key finding of this study is that value-chain and value-network driven business models commercialize their products and services for each value unit transfer, whereas commercialization for value-shop driven business models is realized through the subsidization of direct users by revenue generating entities. This study contributes to extant literature on value configurations and digital businesses models within the emerging and increasingly pervasive domain of cryptocurrency networks.