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Market Manipulation in NFT Markets


  • Oh, Sebeom


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.

Suggested Citation

  • Oh, Sebeom, 2023. "Market Manipulation in NFT Markets," MPRA Paper 116704, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:116704

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    References listed on IDEAS

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    More about this item


    Blockchain; NFT; Manipulative Trading; Insider Trading; Wash Trading;
    All these keywords.

    JEL classification:

    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation

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