Smart Money in the NFT Market: Fact or Fantasy?

Abstract

This paper retests the 'Smart Money' hypothesis from traditional financial markets within the non-fungible tokens (NFTs) market. Unlike traditional markets, where the aggregated and delayed reporting of investment data obscures individual transactions, blockchain technology allows the tracking of buyers and sellers in real-time. We assign Bluechip status to CryptoPunks, the most prestigious and expensive NFT collection, and challenge the notion that Punk holders influence the general NFT market. Our results show that Bluechip holders' buy/sell transactions do not impact other collections' floor prices or trading volumes.

Keywords: Cryptocurrency, Smart Money, NFT

JEL Classification: G12, G14