Investor Impact in the NFT Market: A Comparison Between Whales and Small Investors

Abstract

This study empirically analyzes the determinants of NFT (Non-Fungible Token) value in the collectible NFT market, focusing on investor types. Using structural equation modeling (SEM) and multi-group analysis, we examine the effects of rarity, number of attributes, and trading volume on NFT value, comparing differences between large-scale (whale) and small-scale (ant) investors. Analyzing over 88 thousand transaction data points for 10,000 NFTs from the Bored Ape Yacht Club (BAYC) collection, results show that NFT rarity positively influences value but negatively affects trading volume. Both the number of attributes and trading volume negatively impact on NFT value. Multi-group analysis reveals statistically significant differences in NFT value assessment between whale and ant investors. Whale investors showed a stronger preference for NFTs with higher rarity, particularly valuing the rarity of 'eyes', 'mouth', and 'earring' attributes. Conversely, ant investors showed more interest in NFTs with higher trading frequency and a greater number of attributes. This research contributes to improving the accuracy of NFT value assessment by modeling rarity as a latent variable and clarifying the impact of market dynamics and investor behavior on the structure of the NFT market. These findings provide practical implications for NFT creators, investors, and marketplace operators, and are expected to contribute to strategy formulation for the sustainable development of the NFT market in the future.