9 months ago
A trio of studies published successful November whitethorn radiance immoderate airy connected the societal and intelligence factors that motivate question successful the non-fungible token (NFT) market.
Researchers from Western University successful Canada, Tilburg University successful the Netherlands, the University of North Carolina astatine Chapel Hill successful the U.S., and Rennes School of Business successful France, crossed 3 autarkic studies, recovered that idiosyncratic experiences and luck, on with plus scarcity and user optimism, were catalysts for the bulk of marketplace question successful the NFT space.
NFT marketplace movement
In a survey conducted by Guneet Kaur Nagpal of Western University and Luc Renneboog of Tilburg University, entitled “On Non-fungible Tokens, Blockchain Hypes, and the Creation of Scarcity,” the researchers analyzed the marketplace dynamics of “Crypto Punks,” a fashionable bid of NFT assets.
“CryptoPunks,” constitute the researchers, “are among the astir valued Non-Fungible Tokens (NFTs), with singular income specified arsenic CP #5822 fetching USD 23.7 cardinal successful February 2022, and CP #7523 obtaining USD 11.8 cardinal successful December 2021.”
The superior findings, according to the paper, see the appraisal that buyers who were already invested successful Ethereum (the blockchain connected which CryptoPunks assets reside) were much apt to prosecute successful the marketplace astatine higher costs and besides saw higher gains. The researchers besides noted that Ethereum gains and losses didn’t needfully impact the terms of NFTs, but did power the determination to merchantability oregon resell assets.
Furthermore, the survey states:
“The authors found that the instauration of rarity, for some CP types and accessory combinations, which tin beryllium captured by statistical and ocular measures, determines pricing.”In a abstracted survey entitled “Personal Experience Effects crossed Markets: Evidence from NFT and Cryptocurrency Investing,” researcher Chuyi Sun of the University of North Carolina astatine Chapel Hill examined transaction-level information from “about 1 million” wallets to survey however “personal experiences” contributed to bubbles successful the NFT market.
”I find that NFT investors who randomly person much invaluable NFTs successful the superior marketplace are much apt to enactment successful consequent superior marketplace sales,” writes Chuyi Sun. They adhd that investors who randomly person much invaluable NFT tokens are much apt to yet acquisition “more lottery-like” cryptocurrencies.
Counterintuitive findings
A 3rd study, conducted by Akanksha Jalan and Roman Matkovskyy of Rennes School of Business, entitled “The Impact of Experience, Overconfidence and Optimism connected Future Cryptocurrency Ownership,” takes a heavy dive into the dynamics surrounding capitalist optimism and their knock-on effect for the cryptocurrency and NFT markets.
Related: The ‘WAGMI’ mentality is undermining crypto
In this study, the researchers found, counter-intuitively, that antagonistic past experiences and capitalist optimism some positively impact the likelihood of aboriginal cryptocurrency and NFT ownership.
“The information that idiosyncratic crypto investors with antagonistic experiences with cryptocurrencies proceed to amusement involvement successful the plus people could bespeak immoderate signifier of self-serving bias,” constitute the authors, earlier adding “with these investors apt attributing their losses to factors beyond their power (like marketplace volatility) alternatively than mediocre decision-making connected their part.”
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