1. PixelPlaygroundHome
  2. Metaverse Insights

The Role of Market Makers in the NFT Market

• Metaverse Insights • 172 views

According to reports, Pacman, founder of Blur, said on social media that most of the trading volume in the traditional market and the token market came from a …

The Role of Market Makers in the NFT Market

According to reports, Pacman, founder of Blur, said on social media that most of the trading volume in the traditional market and the token market came from a few market makers (MM). In the NFT market, the trading activities from MM and collectors seem very different. Before Blur, there were very few MM in NFT. As the market matures, you will see more MM enter the market.

Founder of Blur: The liquidity provided by market makers makes it safer to buy new collections

Interpretation of the news:


The emergence of Non-Fungible Tokens (NFTs) has created a new market that is gaining popularity in the art world. NFTs are distinct digital assets that represent ownership of a virtual item such as a picture, music file, video, or tweet. As the market for NFTs grows, individuals and businesses are beginning to speculate on their potential value. In this context, trading activities play an important role in determining the market price of NFTs.

According to reports, Pacman, founder of Blur, highlighted the difference between the NFT market and traditional and token markets regarding the contribution of market makers to trading volumes. While most trading activities in the traditional and token market come from a few market makers, the NFT market is different. Before Blur’s arrival, there were very few market makers in the NFT market. However, as the market matures, we can expect to see more market makers enter the market.

Market makers play a critical role in trading activities by providing liquidity, which facilitates price discovery. A market maker is a firm or an individual that provides buy and sell quotes for digital assets, thus ensuring that there is always a buyer and a seller for the asset. The market maker captures the difference between the bid and ask price as profit. More market makers in the NFT market would mean that there is more liquidity, which could attract more traders and investors to the market.

The lack of market makers in the early stage of the NFT market could be attributed to the newness of the market and the complexity of NFTs. NFTs have had a substantial number of challenges ranging from the high cost of minting to the lack of standardized metrics for evaluating token valuations. Market makers have typically avoided such new, risky, and untested markets and sought to enter markets with more established metrics, lower risk, and greater institutional recognition.

In conclusion, the rise of the NFT market has created new opportunities for art collectors and investors globally, and as more market makers enter the market, we can expect to see greater liquidity, which will lead to more efficient price discovery, more crypto-traders, and more institutional investors entering the market. The NFT ecosystem, while still in its infancy, has the potential to revolutionize the art world and create new opportunities for creatives and entrepreneurs.

This article and pictures are from the Internet and do not represent Fpips's position. If you infringe, please contact us to delete:https://www.fpips.com/4205/

It is strongly recommended that you study, review, analyze and verify the content independently, use the relevant data and content carefully, and bear all risks arising therefrom.

Like (0)
Previous 03/01/2023 07:26
Next 03/01/2023 07:39

Recommended articles