Two-sided Long Tails on Blockchain-Based Crowdsourcing Platforms

Abstract

Motivated by the recent adoption of a blockchain-based token-weighted incentive mechanism in online crowdsourcing markets, which has sparked concerns over power and popularity concentration, this study investigates the interactions between the distributions on the two sides (voters and contributors) of a blockchain-based crowdsourcing platform (BCP). Built upon the theories of long tails and two-sided markets, we propose a two-sided long-tail framework to uncover the distributional dynamics on BCPs. Our weekly panel data analyses show that the concentration in token holdings distribution among voters negatively affects content growth, which in turn leads to a higher content popularity concentration. Such an adverse effect is more pronounced in niche content growth compared to popular content growth. The results also show that the distribution of voters' token holdings positively affects content diversity, which in turn results in a more evenly distributed content popularity. The theoretical contributions and practical implications of our findings are discussed.