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September 27, 2025International Journal of Network Management3 citationsOpen Access

Effects of Fractionalizing NFTS in the Art Market: An Empirical Study of Fractional Art

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JTJana Gómez TabladilloMSMiguel‐Ángel SiciliaMBMaría Elena García Barriocanal

Key Points

  • Fractionated NFTs experience improved liquidity, facilitating smoother trading transactions.
  • Analysis of NFTs fractionated into ERC-20 tokens shows significant trends that support enhanced user engagement.
  • An empirical approach combines quantitative and qualitative methods to explore the dynamics of NFT frachtionalization.
  • Findings point to the potential benefits of fractionation, suggesting greater market access for small investors.

Abstract

ABSTRACT In 2014, the art world began using NFTs. Since then, the exponential increase in the price of some of these digital artworks has made them inaccessible to many small investors and private collectors. For this reason, various protocols such as Fractional.art have emerged to democratize the process, allowing users to fractionalize NFTs to make trading more fluid. The objective of this article is to analyze the NFTs fractionated into ERC‐20 tokens using the Fractional.art protocol, with the aim of determining the contribution of fractionation to the liquidity of the assets, among others. The research method employed is an empirical analysis based on quantitative research to identify key characteristics and trends to support the initial hypothesis. This is combined with a qualitative approach to provide a deeper understanding. The results show that fragmentation has a positive effect on the liquidity of the NFT when the user decides to trade it. This means that fractionated NFTs can benefit from certain liquidity advantages of centralized investment markets, thereby facilitating trading. While NFTs have received increasing scholarly attention, most research on fractionalized NFTs has focused on the theoretical and technical design of fractionation protocols. Although recent studies have begun to empirically examine NFT market dynamics more broadly, there remains limited evidence on whether fractionalization effectively enhances liquidity. This article seeks to contribute to that emerging area by offering a focused, data‐driven analysis of F‐NFT liquidity and user behavior.

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Cite This Study

Tabladillo et al. (2025) studied this question.

synapsesocial.com/papers/68d7be5eeebfec0fc52377d1https://doi.org/10.1002/nem.70027
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