It is no secret that the NFT market is actively covered by the media. The influence of the media on the development of non-fungible tokens has been studied by representatives of several universities. The results surprised academics, pointing to investor education, good awareness among market participants, and an increase in the number of transactions.
Dr. Sean Wilkoff and his colleague Serhat Yildiz are assistant professors of business at the University of Nevada College of Business in Reno. Together with other experts, they analyzed the interaction between NFT technology and the media. The scientists expected to see a classical connection between increased speculation and regular media mentions. However, they came to the opposite conclusion.
The fact is that a similar study of the stock market showed an unjustified increase in optimism and investment expectations. In other words, the media:
- Was distorting reality;
- fueled excitement and increased volatility;
- increased risk;
- misled investors.
As a result, it turned out that NFT did not suffer from the “baby diseases” of its big brother. Broad media coverage provides investors with useful information. It teaches to analyze the situation and make the right decisions.
The fact that the market of unique tokens is initially prone to risk. Mass media attention and regular publications give the traders an opportunity to study the situation. This reduces overall risk, increases returns and spurs creative solutions.
“I was surprised. News usually causes a stir, like in the stock market. So I thought the results would be similar. Especially since we were looking at a speculative market,” Wilkoff noted.
However, the University of Nevada staff asks investors to be cautious. Although the study revealed unexpected upside, the researchers call NFT a “gamble.” You should invest only if you can afford the risky transactions. And, of course, these should not be your last assets.