Rarity Defense: A Formal and Empirical Analysis of NFT Trait Systems for Wash Trading Mitigation

초록

The thriving Non-Fungible Token (NFT) market, despite its innovative redefinition of digital ownership, faces malicious attacks and challenges, notably from widespread wash trading. In this paper, we examine the underexplored relationship between NFT rarity and wash trading. We present a novel approach to NFT market dynamics, by establishing the first comprehensive formal framework for NFT trait systems, including essential definitions, a robust taxonomy, precise rarity calculation, and verifiable properties. Building upon this, we conduct an empirical analysis of NFT rarity and wash trading across 30 collections including 336,133 NFTs, 764,679 transactions, and a total volume of 14,394,949 ETH. Our findings reveal the strong inverse correlation between a collection's price-rarity coefficient and its wash trading volume, showing that the top 5 collections with the lowest price-rarity coefficients are overwhelmingly dominated by wash trading, averaging 89.29% of their total volume, in contrast to the vast majority of other collections which exhibit negligible volumes, consistently below 2%. Case studies further highlight the power of this price-rarity analysis as a novel anomaly detection tool: it identified wash trading-induced distortions in CryptoPunks by detecting an outlier previously undetectable by existing graph-based approaches. We also demonstrate the remarkable resilience of the Rektguy collection-absorbing 20.04% wash volume possibly due to strong price-rarity correlation. Our findings establish rarity as an intrinsic resilience factor against manipulation, fundamentally reshaping approaches to NFT market analysis and robust anomaly detection.

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