Mapping the NFT revolution: market trends, trade networks, and visual features

Flavio Di Giacinto,Laura Alessandretti,Matthieu Nadini,Andrea Baronchelli,Luca Maria Aiello,Mauro Martino

doi:10.1038/s41598-021-00053-8

Abstract

Non Fungible Tokens (NFTs) are digital assets that represent objects like art, collectible, and in-game items. They are traded online, often with cryptocurrency, and are generally encoded within smart contracts on a blockchain. Public attention towards NFTs has exploded in 2021, when their market has experienced record sales, but little is known about the overall structure and evolution of its market. Here, we analyse data concerning 6.1 million trades of 4.7 million NFTs between June 23, 2017 and April 27, 2021, obtained primarily from Ethereum and WAX blockchains. First, we characterize statistical properties of the market. Second, we build the network of interactions, show that traders typically specialize on NFTs associated with similar objects and form tight clusters with other traders that exchange the same kind of objects. Third, we cluster objects associated to NFTs according to their visual features and show that collections contain visually homogeneous objects. Finally, we investigate the predictability of NFT sales using simple machine learning algorithms and find that sale history and, secondarily, visual features are good predictors for price. We anticipate that these findings will stimulate further research on NFT production, adoption, and trading in different contexts.

Highlights

Non Fungible Tokens (NFTs) are digital assets that represent objects like art, collectible, and in-game items
Following an initial rapid growth in late 2017, when CryptoKitties collection gained worldwide popularity, the size of the NFT market has remained substantially stable until mid 2020, with an average of ∼ 60 000 US dollars traded daily
This paper presented the first overview of some key aspects of it by looking at the market history of 6.1 million NFT trades across six main NFT categories including art, games and collectibles

Summary

Introduction

Non Fungible Tokens (NFTs) are digital assets that represent objects like art, collectible, and in-game items. A visual representation of the trader network including the Art category on February 2021 shows the clusters formed by NFT traders specialized in the same collection (see Fig. 5a).

Results

Conclusion