Crowdfunding in Europe: the impact of national crowdfunding regulation

Abstract

Crowdfunding is a new way of funding projects, which has developed the past few years. The rapid growth has resulted in an unregulated industry due to a lagging legal framework. As a result, some European countries have implemented a national crowdfunding regulation. This study tries to examine the effect crowdfunding regulation has had on the development of new crowdfunding platforms by assessing the differences in growth rates before and after the regulation. Examining seven out of 11 countries in Europe who has enforced crowdfunding regulation, only two countries experienced a constant or an increase after the crowdfunding regulation. However, by including the perception the crowdfunding industry had on the regulation, no pattern seems to be conducted between the perception of the regulation and the actual growth of new platforms.