Analysis of Non-Fungible Token Pricing Factors with Machine Learning

Abstract

Rarity is known to be a factor in the price of non-fungible tokens (NFTs). Most investors make their purchasing decisions based on the rarity score or rarity rank of NFTs. However, not all rare NFTs are associated with a higher price, especially for play-to-earn gaming NFTs. In this paper, we studied the top-ranked play-to-earn gaming NFTs on Axie Infinity. We found that, in addition to rarity, utility is also a significant factor influencing the price. Furthermore, we use utility as a predictor to predict the price of Axies using the XGBoost regressor. Our results reveal that, compared to using rarity-based predictors only, leveraging utility-based predictors can improve the prediction accuracy, thus highlighting utility as a price determinant for play-to-earn gaming NFTs.