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Mapping information flows among digital assets: An entropy and network-based study of cryptocurrencies, DeFi, and NFTs

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  • Le, Thai Hong
  • Pham, Dat Thanh
  • Le, Khanh Ngoc
  • Le, Anh Chi
  • Nguyen, Huong Mai Thi

Abstract

This study examines the interconnectedness and information spillovers among cryptocurrencies, decentralized finance (DeFi), and non-fungible tokens (NFTs). Using a time-varying entropy-based network framework that combines transfer entropy and minimum spanning tree (MST) methodologies, we quantify directional information flows and market integration across these asset classes. The results show strong and asymmetric spillover effects from major cryptocurrencies, with Bitcoin and Ethereum serving as dominant transmitters, while DeFi and NFTs largely act as net receivers of information. DeFi plays a bridging role that links asset categories but remains highly dependent on core cryptocurrencies, whereas NFTs exhibit weaker integration and peripheral positions in the network. These findings highlight the evolving hierarchy and dynamic linkages across digital assets, and they carry practical and policy implications by underscoring the need for robust risk management strategies for investors and prudential monitoring of systemically important tokens and protocols to safeguard financial stability.

Suggested Citation

  • Le, Thai Hong & Pham, Dat Thanh & Le, Khanh Ngoc & Le, Anh Chi & Nguyen, Huong Mai Thi, 2026. "Mapping information flows among digital assets: An entropy and network-based study of cryptocurrencies, DeFi, and NFTs," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 681(C).
    • Handle: RePEc:eee:phsmap:v:681:y:2026:i:c:s0378437125007320
    DOI: 10.1016/j.physa.2025.131080
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    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • E60 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General
    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors

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