Author: Cheng, King Hin
Title: Using stratification to measure price growth of non-fungible tokens : focusing on land in metaverses
Advisors: Hui, Eddie (BRE)
Degree: DIREC
Year: 2023
Subject: NFTs (Tokens)
Blockchains (Databases)
Hong Kong Polytechnic University -- Dissertations
Department: Department of Building and Real Estate
Pages: viii, 150 pages : color illustrations
Language: English
Abstract: This research delves into the subject have significance of monitoring the price performance of non-fungible tokens (NFTs) land markets, which has emerged as a growing concern owing to the lack of pertinent indicators and reliable indices in the market. The absence of said indicators has varying effects on investors, end users, financial institutions, and government agencies. The present study offers a comprehensive examination of the existing literature on NFT land price indexes and proposes a novel index that could potentially provide a more precise depiction of the price trends in NFT land markets, with the aim of addressing this concern.
The proposed methodology is based on the stratified median price approach, which considers the compositional effects and the fade-out characteristics of NFT land in every metaverse. This renders it more appropriate than existing techniques for monitoring the price dynamics of NFT land markets. The proposed index is evaluated through a case study of the NFT land market in Decentraland, a prominent metaverse platform. The results suggest that the novel index could provide a more precise representation of the price performance of NFT land markets compared to earlier methodologies, while also offering a more refined depiction of market trends and instability.
The lower volatility observed in certain areas provides evidence for the importance of amenities and proximity of celebrities in determining the value of NFT property. The volatility in NFT property prices can be ascribed to the rapid and straightforward process of NFT transactions, which facilitates prompt changes in the market.
The current research offers an important contribution to the domain of assessing the NFT land price index. The formulation of a revised stratified median methodology entails an initial phase of conducting a comprehensive examination of pertinent academic literature pertaining to subjects such as land valuations, residential property valuations, blockchain technology, and NFTs. This research makes a valuable contribution to the practical implementation of NFT land price indices by developing a dependable and straightforward index. The research wraps up with new perspectives and updated information regarding the assessment of land markets for NFTs.
The proposed index exhibits the potential to attract a broader demographic in comparison to traditional methodologies such as hedonic models and repeat sales models, due to its simplified approach. The implementation of the stratified index technique is a solution to the problem of subjective evaluations and the application of varied regulations across numerous metaverses. The NFT land price index holds significant importance in the realm of risk management and investment. It enables the development of index derivatives, including futures and options, for real estate indices. Furthermore, it assists investors, practitioners, and researchers in developing better-informed decisions.
Despite encountering certain limitations and challenges, price indexes for NFT land remain essential instruments for assessing the expansion of the NFT sector. Additional investigation in this domain has the potential to assist in reducing these constraints and enhancing the precision and dependability of non-fungible token valuation indices. Research could be conducted to investigate the potential of integrating NFT land price indexes with supplementary data sources such as blockchain data, economic data, and demographic data, in order to augment their precision and dependability.
Rights: All rights reserved
Access: restricted access

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