Is non-fungible token pricing driven by cryptocurrencies?

By Michael Dowling. Finance Research Letters, 2021

462 citations recorded by the source corpus.

Abstract In early 2021, non-fungible tokens (NFT) became the first application of blockchain technology to achieve clear public prominence. NFTs are tradeable rights to digital assets (images, music, videos, virtual creations) where ownership is recorded in smart contracts on a blockchain. Given the NFT market emerged out of cryptocurrencies, we explore if NFT pricing is related to cryptocurrency pricing. A spillover index shows only limited volatility transmission effects between cryptocurrencies and NFTs. But wavelet coherence analysis indicates co-movement between the two sets of markets. This suggests that cryptocurrency pricing behaviours might be of some benefit in understanding NFT pricing patterns. However, the low volatility transmissions also indicate that NFTs can potentially be considered as a low-correlation asset class distinct from cryptocurrencies.

Subfields: Economics and Econometrics, Information Systems

View Paper: https://www.semanticscholar.org/paper/a13d2d1056254bbac922866fb7f056015dc71454

How researchers see this paper

The researchers whose trusted networks rank it highest, strongest advocate first. Every researcher gets a different order.

In Economics and Econometrics

1. Lennart Ante
2. Minrui Xu
3. Xuemin Shen
4. Jiawen Kang
5. Qiang Yang
6. Chunyan Miao
7. Dusist Niyato
8. Wei Yang Bryan Lim

In Information Systems

1. Dusist Niyato
2. Zehui Xiong
3. Jiawen Kang
4. Lennart Ante
5. Minrui Xu
6. Xuemin Shen
7. Qiang Yang
8. Chunyan Miao

Citations in the corpus

• A Full Dive Into Realizing the Edge-Enabled Metaverse: Visions, Enabling Technologies, and Challenges (2022, methodology): “used to store the encrypted hash value of the metadata and media data for verification [262].”
• The non-fungible token (NFT) market and its relationship with Bitcoin and Ethereum (2021, methodology): “Our data on overall trading volume and users should permit a better understanding of the NFT phenomenon, with the existing research focusing on pricing aspects of NFT (sub)markets [6,14].”
• Mapping the NFT revolution: market trends, trade networks, and visual features (2021, background): “This is the case for collections containing pieces of pixel-art, including Chubbie, Cryptopunks and Wrapped Punks, or the similarities observed between Cryptokitties and Axie (Figure 6a).”