Wash trading volume on the Ethereum-based NFT marketplace is at its lowest level since May 2022, according to The Block Pro’s data dashboard.
NFT wash trading volume on the Ethereum marketplace hit 1.8% on January 9 and January 13. This compares to 36.2% of volume on January 1, 2023, and is also the lowest since the 0.35% rate on May 1. 2022. The percentage represents the portion of total USD trading volume that is associated with wash trading, a type of market manipulation in which individuals trade an asset to artificially increase its price or liquidity.
Wash volume ratio for Ethereum-based NFT marketplaces after December 31, 2022. Image: Block Pro Data Dashboard
Eradicate wash trading
The NFT platforms that were the biggest contributors to wash trading in the past – LooksRare, X2Y2, and Blur – have all made changes to further curb this activity.
“We are starting to see exchanges like LookRare and X2Y2 begin phasing out some of their trading rewards programs,” said Rebecca Stevens, senior research analyst at The Block. “Blur has been actively trying to filter wash traders out of the airdrop, which has made wash trading less attractive. In addition to causing the value of several NFT marketplace tokens to fall, this has also caused overall wash trading to continue to decline.”
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About the author
MK Manoylov has been a reporter for The Block since 2020, joining just before Bitcoin surpassed $20,000 for the first time. Since then, MK has written nearly 1,000 articles for publications covering all cryptocurrency-related news, preferring NFTs, metaverse, web3 games, fundraising, crime, hacking, and cryptocurrency ecosystem stories. MK holds a graduate degree from New York University’s Science, Health, and Environmental Reporting Program (SHERP) and has also covered health topics for WebMD and Insider. X You can follow MK at @MManoylov and on LinkedIn.