EconPapers    
Economics at your fingertips  
 

Market Manipulation in NFT Markets

Sebeom Oh

MPRA Paper from University Library of Munich, Germany

Abstract: Non-Fungible Tokens (NFTs) are a new form of digital asset used for fundraising purposes, similar to equity crowdfunding, but within an unregulated environment. The NFT market has been described as an unregulated and prone to misconduct, but there is a lack of detailed analysis on such behaviors. This paper examines the use of manipulative trading, specifically unrevealed insider trading and wash trading, within the NFT market using publicly available transaction data on the Ethereum blockchain. The results show that insiders buying behavior strongly predicts higher future price returns. Even if the circulated USD amount in wash trades is more than 422 million, wash trades fails to impact meaningful market outcomes. I find that some investors engage in wash trading to earn rewards from NFT marketplaces or promote emerging marketplaces in competition with the dominant platform.

Keywords: Blockchain; NFT; Manipulative Trading; Insider Trading; Wash Trading (search for similar items in EconPapers)
JEL-codes: G14 G28 (search for similar items in EconPapers)
Date: 2023-03-22
New Economics Papers: this item is included in nep-fmk, nep-mst and nep-pay
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
https://mpra.ub.uni-muenchen.de/116704/1/MPRA_paper_116704.pdf original version (application/pdf)
https://mpra.ub.uni-muenchen.de/117531/1/Draft_NFT_Market_Manipulation.pdf revised version (application/pdf)
https://mpra.ub.uni-muenchen.de/117629/1/Draft_NFT_Market_Manipulation.pdf revised version (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:116704

Access Statistics for this paper

More papers in MPRA Paper from University Library of Munich, Germany Ludwigstraße 33, D-80539 Munich, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Joachim Winter ().

 
Page updated 2023-11-11
Handle: RePEc:pra:mprapa:116704