Non-Fruitful Token? Market Reactions to NFT-related Disclosures

Abstract

This study analyzes market reactions to firms’ “NFT” or “Non-Fungible Token” disclosures filed with the SEC. The analysis distinguishes “Clear” disclosures, indicating actual NFT engagement, from “Vague” ones, referring to vague future intentions. Both types exhibit similar non-significant CAAR behavior upon announcement, followed by a significant decline. Positive cash flow firms experience initial positive CAAR, reversing by day 4. Segmenting by traits shows varied CAAR patterns, but overall, the study suggests skepticism toward NFTs. Firms in or entering this space face consistent negative CAAR over 30 days post-publication, indicating market mistrust.