The role of oil price in determining the relationship between cryptocurrencies and non-fungible assets

Abstract

This study aimed to explain the relationship between bitcoin and nonfungible tokens (NFTs) to determine if the NFT is an alternative investment to bitcoin or a complement during oil price uncertainty. The results showed a comovement between NFT and bitcoin prices. However, after excluding the effect of oil prices and using the partial wavelet coherence test, the results changed and the comovements disappeared: bitcoin and NFT became two separate assets that are affected by different variables. Moreover, oil price has more impact on bitcoin than NFT in the medium and long run. However, these results indicate that the change in oil prices, to some extent, is not considered a strong influence on the crypto market. Nevertheless, a significant rise in crude oil prices leads to a significant change in the comovement between crypto assets and they become interrelated.