Dino Arnaut, Damir Bećirović, Janez Kolar

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Frontier capital markets are a specific category within emerging markets, characterized by lower market capitalization, liquidity, and fewer investment constraints. These markets do not offer opportunities for investment and their functionality for companies to finance their future endeavors is not efficient. This paper offers a comprehensive examination of smart contracts, including their functioning principles, prevalent platforms, and uses. Consequently, it suggests a model for a junior stock market that utilizes blockchain-supported smart contracts. The model gives a framework for organizing the Junior stock exchange segment in frontier capital markets by offering a new fundraising method for SMEs. Application of this model simplifies the entry of smaller companies, allowing them to enter the market without regular trading requirements. Therefore, shift in financial instrument supply and alternative financing for young companies can boost market liquidity and capital mobilization. Blockchain technology ensures transparency and strengthens market confidence.


Frontier Markets, Blockchain, Smart Contract, Junior Stock Exchange Financial Management

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