This paper analyzes the sales of 875,389 art nonfungible tokens (NFTs) on the Ethereum blockchain to identify the key determinants influencing NFT pricing and market dynamics. We find that market liquidity and trade volume are strong predictors of NFT prices. Contrarily, social media activity negatively correlates with prices. Introducing an artist ranking system, our study reveals a “superstar effect”, with a few artists dominating sales, and herding behaviour within the NFT market.
@article{fridgen2025pricing,title={Pricing dynamics and herding behaviour of NFTs},author={Fridgen, Gilbert and Kr{\"a}ussl, Roman and Papageorgiou, Orestis and Tugnetti, Alessandro},journal={European Financial Management},volume={31},number={2},pages={670--710},year={2025},doi={10.1111/eufm.12506},url={https://onlinelibrary.wiley.com/doi/full/10.1111/eufm.12506},dimensions={true},}
2024
J. Econ. Surv
Non-fungible tokens (NFTs): A review of pricing determinants, applications and opportunities
This paper provides a review of the development of the non‐fungible tokens (NFTs) market, with a particular focus on its pricing determinants, its current applications, and its future opportunities. We investigate the current state of the NFT markets and highlight the perception and expectations of investors toward these products. We summarize and compare the financial and econometric models that have been used in the literature for the pricing of non‐fungible tokens with a special focus on their predictive performance. We design a framework that can help to understand the price formation of NFTs. We further aim to shed light on the value‐creating determinants of NFTs in order to better understand investors’ behavior on the blockchain.
