If you’re looking to make a smart pick for your next NFT investment, one important factor to consider is rarity. Rarity can help you determine the value of an NFT and make it easier to decide which one to invest in. Whether you’re an experienced collector or new to the world of NFTs, understanding rarity is essential for making informed investment decisions. Good news for collectors — Yumi NFT Marketplace is now introducing rarity scores for its collections, making it even easier to evaluate potential NFT investments.
Rarity scores provide an overview of the probability of an NFT possessing certain characteristics or traits. These traits are often associated with properties, which are the pre-defined features of the NFT. By examining the probabilities of each trait within a specific property, collectors can get a sense of how rare or common the NFT is overall. You can see an example of how properties and traits are represented on Yumi NFT Marketplace in the image below.
When it comes to calculating the overall rarity score of an NFT, there are several approaches to consider, each with its own pros and cons. Here are a few examples of how an NFT’s rarity may be calculated:
- Average Trait Rarity: This approach takes the average probability of all traits within a property. While it is simple and easy to apply to any collection, this method is not statistically representative and can dilute the rarity of very rare traits.
- Trait Rarity Ranking: This method ranks NFTs based on the rarity of their rarest trait. While this approach is straightforward and easy to understand, it does not take into account the overall rarity of an NFT with multiple slightly less rare traits.
- Rarity Score: This method combines the individual trait rarities in a statistically significant way to give a more accurate representation of the rarity of an NFT. For these reasons, Yumi NFT Marketplace has chosen to implement the Rarity Score method to calculate the rarities of its NFTs. A more detailed explanation of this method is provided below.
The Rarity Score is a method of quantifying the rarity of an NFT that was developed by OpenRarity and is currently being used on collections on OpenSea. The formula for calculating the Rarity Score of an individual NFT is as follows:
In this equation, (R) is the Rarity Score of a specific NFT, P(trait) is the probability of an NFT having a certain trait, and (N) is the total number of properties of the NFT.
We chose to use the Rarity Score method for several reasons. Firstly, it provides a realistic representation of an NFT’s rarity, allowing users to accurately gauge its value. The method involves multiplying the probability of each trait to determine the probability of an NFT possessing all of its traits. This is then transformed into a numerical value using a base 2 logarithm, which allows for easy interpretation of the score. An increase of 1 of the numerical value of the score means that the NFT is twice as rare. For example, an NFT with a score of 21 is twice as rare as an NFT with a score of 20. This makes it easy to compare the rarity of different NFTs and make informed investment decisions.
To help users make informed decisions about which NFT to invest in, we have grouped the rarities into categories based on their ranking within the collection. These categories are:
- Top 0.1%
- Top 1%
- Top 5%
- Top 10%
This allows users to quickly and easily compare the rarity of different NFTs and make informed decisions.
By introducing rarity scores on Yumi NFT Marketplace, we aim to make it easier for collectors to decide which collection to invest in. In order to calculate the rarity of an NFT, it must have properties and associated traits. As a result, only collections with properties will have a rarity score displayed on Yumi. This allows collectors to more easily evaluate the value and rarity of a potential investment.
Happy Collecting!
