What is wash trading and Exactly who framed the NFT market
Wash trading is when a trader buys and sells stocks in order to mislead the market. Awash trade is an act of market manipulation in which an investor sells and buys the same financial instruments simultaneously to create misleading, artificial activity in the marketplace.
A trader will first place a buy order to buy from themselves and then place a sell order. It is common practice to create hype in the market and make it worth getting into the movement where other traders or investors will be interested. This may be done for several reasons.
Making it appear as if the instrument is in greater demand than it actually is by artificially increasing trading volume. To generate commissions for brokers for something that cannot be openly funded. In recent weeks we’ve noticed an increased volume of “wash trading” of NFTs
This is not something new to the crypto or NFT market, and this kind of practice has been going on for some time now. Wash trading is mostly limited in the NFT market, but its impact is huge when it happens in any project. In The past, some of the projects were suspected of wash trading, and users have suffered, rather than traders or artists.
This kind of trading does have a problem, and let us explain it in detail. Statistics about the growth and reach of projects’ own platforms are no longer reliable. The first impression is the last impression in the view of the market, e.g., if the project is listed as a wash trading, then the long-term future of the NFT project is dark indeed. Many investors will not even tough the projector will swiftly try to share the news in the market. A gamer, art artist, or even a normal small-scale buyer will try to get info on the project, and if it’s the mismatch of wash trading, then the news will be circulated quickly, and the project will have deemed impression.
Due diligence is much more difficult as investors rely less and less on measurable statistics. Data must be checked for irregularities by specialists. Adapting to social norms (property rights, financial practice, marketing tactics) enhances the likelihood of adopting and accepting technology.
Is the problem fixable! Yes, some measures can be achievable to save this kind of trade. As we all know, it’s anonymous blockchain technology for free and open nature, Projects must be well designed, and implications should leave no trace. Gas fees play an important role in terms of attackers. If the fees are in a certain percentage, cheaters will think twice to manipulate the market or a certain project.
More dangerous is the outsourcing of the project like designing and development. If the info is being leaked, then it’s a major cause because the inside news is being spread all over the community. And that spread will cause harm at the launch of the project. The project owner should contain the information to limited sources is the biggest prevention.
The ultimate agenda is to prevent users from making decisions based on false or manufactured statistics. Statistical staging and groups must also play a role in education. Users need to be mindful of these techniques and past, present, and possible future scenarios.
Framing the Importance of NFT –
Who framed the NFT is the first question that comes to our mind after having been so successful over the years.No; one knows if this is just a start or in shiny phase or a worst to becoming. Now, who created this market and how it came to its existence is not a secret like cryptos. This technological phenomenon came from a man Kevin mccoy back in 2014 when he minted his first token Quantum.
Quantum is an octagon filled with circles, arcs, or other shapes which share a common center, with larger shapes surrounding smaller ones and hypnotically pulsing in fluorescent hues. A one-of-a-kind art piece (2014-2021) called “Quantum” is now up for sale for seven million dollars.
Mccoy was known as the first digital artist. At that time, the Art world was searching for some technological agenda to explore their art in a digital way, and Mccoy and his wife established a revolution to express the coexistence of digital art print, which can be unique and validated.
This particular event was the first of all NFT’s and their development. Many artists praised Mccoy’s work and started the same pattern to invite and pursue clientele. It was a new way of showing interest for art lovers, and it was unique. Every individual around the world was fascinated to publish their own work, and it’s not just the artist, but a long chain of entrepreneurs, art advocates, corporations, authors, videographers, social media personalities, and even average salaried wants to create NFT.
The first of the big three non-fungible tokens were crypto punks, Rare Pepe, and crypto kitties. Initially, there was no interest in it, but later, as the market evolved, it’s a history. If we discuss the pre-era before the quantum was launched, back in 2012, the idea of nft emerged from a token called colored coin. Real-world assets can be delineated on the blockchain by colored coins, which can serve as proof of ownership for a variety of assets, including precious metals, automobiles, real estate, and even stocks and bonds.
At the time of launching, the big three projects were not that charming from the investing point of view, it was a collectible token and could be worth something shortly, but the reality of these projects is unbelievable. Initial investors have made a huge chunk of profit, and even the future looks bright in terms of the asset.
This original idea was to use cryptocurrencies. As new technologies, they offered diverse possibilities for future utilization. It’s fascinating to know about the history of NFTs, but the future of NFTs has endless opportunities as NFTs transition from raw and experimental to exceedingly useful and mainstream. By combining tokenization, programmability, collaboration, royalties, and more direct connections between artists and collectors, NFTs may soon be a vital part of our everyday lives. Several years ago, concepts like DAOs, tokenized metaverses, and community-owned financial protocols were experiments on a small scale. They are now multibillion-dollar internet communities composed of a protocol-driven design, economics, and governance. In terms of digital art collecting, it’s reasonable to state that we don’t know how much the landscape will alter in the years to come.
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