Unlike traditional currencies that are backed by physical assets, NFTs are digital objects, such as works of art or collectibles. Each NFT is unique and has a certain value depending on its characteristics and demand. This uniqueness distinguishes them from typical cryptocurrencies such as Bitcoin, where each unit has the same value.
Researchers compared the NFT market to established financial markets but acknowledged its unique characteristics and young age. Despite these differences, they have noticed signs of “statistical maturity” emerging in the NFT space.
The analysis revealed the existence of “power laws,” a statistical phenomenon observed in established markets, and suggested that some aspects of NFT trading are predictable. This shows that important events such as large transactions are not as random as thought.
The study also found “long-term memory” in the NFT market; This means that past trends tend to influence future behavior. This feature, together with signs of “multifractality” (where different parts of the system show varying degrees of self-similarity), also indicates the level of complexity and potential coherence of market dynamics.
Researchers found a positive correlation between the price of the cryptocurrency used for NFT trading and the overall trading volume. This suggests a connection between the mature cryptocurrency market and the emerging NFT market.
Although the study is promising, scientists emphasize that more work is needed in this area.
Source: Ferra
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