The Extra-Institutional Logics of an Emerging Market Field: Values and Practice in the Bitcoin Experience

Abstract

Mature fields of market activity are characterized by clear norms, entrenched meanings, and rigid power hierarchies that stabilize logics of action. However, how do logics of action emerge in a nascent field of market activity that lacks these types of institutions? To answer this question, I draw on theories of institutions and markets to examine the experiences of 23 adopters of the cryptocurrency Bitcoin during 2015 to 2016. Utilizing an iterative combination of correspondence analysis (CA) techniques and narrative analysis, I show how Bitcoin adoption was motivated by competing value frameworks that corresponded to different user types in the system. This resulted in the emergence novel “extra-institutional logics” that supported the growth of Bitcoin as a whole despite being centered on different visions for the future of the system. These logics provide a unique glimpse into how Bitcoin was able to survive during a period of notable instability preceding a historic market bubble. This article provides support for dynamic theories of markets and demonstrates how logics of action are tethered to the characteristics of the fields in which they emerge.