Probably something: a multi-layer taxonomy of non-fungible tokens

Abstract

PurposeThis paper aims to establish a fundamental and comprehensive understanding of non-fungible tokens (NFTs) by identifying and structuring common characteristics within a taxonomy. NFTs are hyped and increasingly marketed as essential building blocks of the Metaverse. However, the dynamic evolution of the NFT space has posed challenges for those seeking to develop a deep and comprehensive understanding of NFTs, their features and their capabilities.Design/methodology/approachUtilizing common guidelines for the creation of taxonomies, the authors developed (over 3 iterations), a multi-layer taxonomy based on workshops and interviews with 11 academic and 15 industry experts. Through an evaluation of 25 NFTs, the authors demonstrate the usefulness of the taxonomy.FindingsThe taxonomy has 4 layers, 14 dimensions and 42 characteristics, which describe NFTs in terms of reference object, token properties, token distribution and realizable value.Originality/valueThe authors' framework is the first to systematically cover the emerging NFT phenomenon. This framework is concise yet extendible and presents many avenues for future research in a plethora of disciplines. The characteristics identified in the authors' taxonomy are useful for NFT- and Metaverse-related research in finance, marketing, law and information systems. Additionally, the taxonomy can serve as an information source for policymakers as they consider NFT regulation.

Value creation in the metaverse age: a thematic analysis of press releases

“…These factors serve as prerequisites for firms to identify and seize unique commercial opportunities within the metaverse and gain competitive advantages. Our findings resonate with prior research highlighting the importance of smooth metaverse operations and the role of tools such as virtual, augmented and extended reality (Chen et al, 2022) and NFTs (Hartwich et al, 2023).…”

Guest editorial: Exploring the research opportunities and challenges in the metaverse

“…The authors further illustrated the efficacy of the taxonomy by evaluating 25 NFTs. Overall, by establishing a systematic framework, this study is instrumental for NFT- and metaverse-related research and provides suggestions for policymakers (Hartwich et al ., 2024).…”

Value creation and capture in decentralized finance markets: Non-fungible tokens as a class of digital assets

“…It is a unique and irreplaceable digital object that indicates ownership and can be traded (Valeonti et al, 2021;Wilson et al, 2022). The underlying object can take several forms, such as digital art or collectibles (e.g., images, videos, audio), digital trading cards, in-game items, domain names, digital real estate, event tickets, or even tweets (Fortnow & QuHarrison, 2021a;Hartwich et al, 2023).…”

“…They are potentially radical innovations that could change digital business, for example, marketing, branding, and entrepreneurship (Chandra, 2022;Hakkarainen & Colicev, 2023), and life in general, for instance, education (Wu & Liu, 2023), by revolutionizing the storage, coding, exchange, embedding, verification, and authentication of unique digital content and assets (Wilson et al, 2022). NFTs are considered the enablers of the metaverse and web 3.0 applications (e.g., Hartwich et al, 2023;Kshetri, 2022) and create a parallel market for intangible assets like power, clout, and status (Kraizberg, 2023). One of the first industries disrupted by NFTs is the arts industry (Fairfield, 2022;Hartwich et al, 2023;Pawelzik & Thies, 2022), allowing for the democratization of access to art and financial innovations for more investments in creative work (Damodaran, 2023;Whitaker, 2019).…”

“…NFTs are considered the enablers of the metaverse and web 3.0 applications (e.g., Hartwich et al, 2023;Kshetri, 2022) and create a parallel market for intangible assets like power, clout, and status (Kraizberg, 2023). One of the first industries disrupted by NFTs is the arts industry (Fairfield, 2022;Hartwich et al, 2023;Pawelzik & Thies, 2022), allowing for the democratization of access to art and financial innovations for more investments in creative work (Damodaran, 2023;Whitaker, 2019). Due to their novelty, DeFi and NFT markets (e.g., Dowling, 2022) are not yet well understood, with research only being at the beginning of analyzing value drivers and business models for stakeholders involved (e.g., Baytaş et al, 2022;Wilson et al, 2022).…”