Ether Volatility and NFT Markets

Yufeng Huang (), Bowen Luo () and Chenyu Yang ()
Additional contact information
Yufeng Huang: Simon Business School, University of Rochester, Rochester, NY 14627
Bowen Luo: D’Amore-McKim School of Business, Northeastern University, Boston, MA 02115
Chenyu Yang: 3115E Tydings Hall, 7343 Preinkert Dr., University of Maryland, College Park, MD 20742

No 22-07, Working Papers from NET Institute

Abstract: Non-fungible Tokens (NFT) have emerged as a popular monetization mechanism for digital artists. We study the NFT market on foundation.app, an NFT platform. We document significant heterogeneity of seller behaviors. 6.4% of sellers transfer out their proceeds to a crypto exchange, but they account for 26.4% of all artwork sales. We also find demand is not correlated with ether prices, but ether prices affect the listing prices set by sellers that do not transfer out proceeds. We conjecture that sellers that rely on NFT sales for income are better informed of the demand. We study the implications of the ether price volatility for market efficiency.

Keywords: NFT; crypto price volatility; market efficiency (search for similar items in EconPapers)
JEL-codes: D4 P4 (search for similar items in EconPapers)
Pages: 18 pages
Date: 2022-10
New Economics Papers: this item is included in nep-cul, nep-fmk and nep-pay
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