Auctions with tokens: Monetary policy as a mechanism design choice

• 成果类型: Article
• 署名作者: Canidio, Andrea
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2025.106095
• 发表日期: 2025
• 关键词: approximate competitive-equilibrium; allocation

摘要

I study a repeated auction in which payments are made with a blockchain token created and initially owned by the auction designer. Unlike the virtual money previously examined in mechanism design, such tokens can be saved and traded outside the mechanism. I show that the present-discounted value of expected revenues equals that of a conventional dollar auction, but revenues accrue earlier and are less volatile. The optimal monetary policy burns the tokens used for payment, a practice common in blockchain-based protocols. I also show that the same outcome can be reproduced in a dollar auction if the auctioneer issues a suitable dollar-denominated security. This equivalence breaks down with moral hazard and contracting frictions: with severe contracting frictions the token auction dominates, whereas with mild contracting frictions the dollar auction combined with a dollar-denominated financial instrument is preferred.