NFT Bubbles

Type
working paper
Date Issued
2023-03
Author(s)
;
Abstract
By investigating nonfungible tokens (NFTs), we provide the first systematic study of retail investor behavior through asset bubbles. Given that NFTs are recorded in public blockchains, we are able to track investor behavior over time, leading to the identification of numerous price run-ups and crashes. Our study reveals that agent-level variables, such as investor sophistication, heterogeneity, and wash trading, in addition to aggregate variables, such as volatility, price acceleration, and turnover, significantly predict bubble formation and price crashes. We find that sophisticated investors consistently outperform others and exhibit characteristics consistent with superior information and skills, supporting the narrative surrounding asset pricing bubbles.
Language
English (United States)
Keywords
Financial Bubbles
Nonfungible Tokens
Agent-level
Blockchain JEL classification: G14; G12
Official URL
URL
File(s)
Thumbnail Image

open.access

Name

Barbon and Ranaldo 2023 - NFT Bubbles - Cryptocurrency Research Conference 2023.pdf

Size

536.45 KB

Format

Adobe PDF

Checksum (MD5)

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