This study aims to deepen the understanding of digital incentives. We employed a case study approach to examine a Chinese firm. Based on coding and analyzing rich primary and secondary data, we explore the characteristics and effects of digital incentives. The findings show that digital incentives based on digital technologies such as blockchain include both incentive digitalization and data incentivization. It can effectively motivate participants to collaborate to improve innovation performance. Meanwhile, the information transparency mechanism and trust mechanism embedded in digital incentive contracts can effectively inhibit participants’ opportunistic behaviors, which help to cope with the incompleteness of contracts and improve the effectiveness of digital incentives. The study also reveals the dynamic evolution model in the execution of digital incentive contracts. The findings suggest that this dynamic model is conducive to the adaptive adjustment of incentive resource portfolio, and coordinates the interests and expectations of participants, thus achieving the sustainability of digital incentives. Important practical implications suggest that digital platforms should focus on the role of digital technologies such as blockchain to drive the digital transformation of organizational incentives.