The behavior and determinants of illiquidity in the non-fungible tokens (NFTs) market

【Author】 Wilkoff, Sean; Yildiz, Serhat

【Source】GLOBAL FINANCE JOURNAL

【影响因子】2.853

【Abstract】We provide the first study of time-varying and cross-sectional properties of liquidity in the nascent and rapidly growing non-fungible token (NFT) marketplace. Using transaction-level data, we document important weekday patterns in NFT liquidity. Despite the decentralized nature and infancy of the marketplace, we show the overall determinants of NFT liquidity have several parallels with highly developed financial markets. We then study how the arrival of new infor-mation impacts NFT marketplace liquidity. By reducing information frictions, NFT news increases NFT liquidity, especially when the media source tends to provide more specific or technical in-formation about NFTs. Overall, our findings deepen our understanding of how liquidity impacts newly developed marketplaces.

【Keywords】Information; News; Non-fungible tokens; Digital assets; Liquidity; Blockchain; Ethereum

【发表时间】2023 FEB

【收录时间】2023-03-28

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