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Ether Volatility and NFT Markets

Author

Listed:
  • 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)

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.

Suggested Citation

  • Yufeng Huang & Bowen Luo & Chenyu Yang, 2022. "Ether Volatility and NFT Markets," Working Papers 22-07, NET Institute.
    • Handle: RePEc:net:wpaper:2207
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    File URL: http://www.netinst.org/Yang_22-07.pdf
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    More about this item

    Keywords

    NFT; crypto price volatility; market efficiency;
    All these keywords.

    JEL classification:

    • D4 - Microeconomics - - Market Structure, Pricing, and Design
    • P4 - Political Economy and Comparative Economic Systems - - Other Economic Systems

    NEP fields

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