Are NFTs a Good Investment?
NFTs have been taking the world by storm, but it’s still common to wonder, are NFTs a good investment? While there are plenty of overnight sensation stories of token holders becoming millionaires, that’s not the case for everyone. NFT investing is similar to other investments.
Thorough research, chance, and timing are essential pieces of the puzzle. Everyone wants peace of mind about their investments, and it all starts with the knowledge to make informed decisions. We will explore some of the history, future, and current speculations around NFTs.
Why NFTs are the Future
NFTs are non-fungible tokens that have advantages for the buyer and seller alike. Artists and designers continue to gain traction for their work. Buyers and token holders continue to make a profit and claim ownership over unique collectibles. How NFTs work is through the utilization of blockchain technology. This is a public ledger that keeps a record of transactions, ownership, and every NFT’s traceable address.
The entire future of financial technology is decentralizing personal capital and putting it into the safe hands of Web3. While specific NFTs will come and go, the creation of blockchain/cryptocurrency/NFTs has shifted the future of the world. The reality of the NFT space but the evolution will affect the world as we know it today.
Where NFTs Came From
NFTs emerged from what used to be called a colored coin, first appearing on the Bitcoin blockchain in 2012-2013. They were recognized as real-world assets in the form of tokens, represented digitally through NFTs. There were NFTs way before the crypto market took off and crypto-art became ubiquitous. One of the first cultural shifts occurred when CryptoPunks, Rare Pepe, and CryptoKitties gained traction as valuable tokens.
How NFTs are created today is through generating images, minting, and putting the tokens up for sale. Collections are displayed on sites like OpenSea and linked to crypto wallets. Wondering how NFTs make money? It may be done in various ways. Most commonly through exchanging assets or minting specialized projects to create a profit. How NFT minting works is usually through a minting software that publishes tokens on the blockchain, so they are eligible for purchase.
Are NFTs scams?
Many people believe that NFTs are scams or another pyramid scheme that people should be wary of. There are social media conversations about NFTs being facilitators of money laundering or destroying the environment. Many people worry about the energy used by Ethereum, but there are plenty of alternate platforms that use substantially less energy. With anything in the world, there are people that scam the system.
There are instances where people have scammed artists of their original artwork. NFTs as a whole are not a scam, indeed, there are plenty of people that found solace in the community and newfound financial freedom. The technology behind NFTs is unparalleled, and it will definitely have an impact on the future. NFTs can be a double-edged sword, but for people that do their research, they are often congratulated with substantial rewards.
What NFT should I buy?
If you’re looking for what NFT to buy, there are plenty of marketplaces available that allow you to purchase, trade, and own tokens. According to research, new NFTs are always on the rise, and previous successors are still standing strong.
Here are some popular NFT collections as of March 2022; as always, do your own research:
- Lucky Block
- Yubo Randos
- Azuki NFTs
- Invisible Friends
- Bored Ape Yacht Club
- Pudgy Penguins
- Loot for Adventurers
- Town Star
- Matrix NFTs
- Shiboshi NFTs
- Disney NFTs
- Loaded Lions NFTs
Where are NFTs sold?
NFTs are are often sold in two particular sales types. Traditionally, NFTs are available on “secondary marketplaces”. Secondary marketplaces are open marketplaces in which anybody may purchase an NFT. However, in the case of NFT collections, most NFTs are minted directly from the creators website at a discounted price prior to being sold on secondary marketplaces.
Open NFT marketplaces:
- Opensea (Ethereum, Polygon, Binance Smart Chain)
- Rarible (Ethereum, Polygon)
- MagicEden (Solana blockchain)
- Solsea (Solana blockchain)
Are NFTs a Good Investment?
NFTs are a good investment when you are well-informed on the asset you acquire and the trajectory of potential value surges. The NFT market has changed many people’s lives, and the technological shift to decentralized banking is monumental. Despite speculations and varying opinions, investments are a grey area. There is rarely certainty initially, but with increased knowledge about the crypto and NFT space, informed investments come easier to many buyers.
How to Create an NFT Collection?
Looking to get in on the profits as a NFT creator? Read our article, “How to Generate a NFT Collection with an NFT Generator” to learn how to create an NFT collection and host a mint sale. We cover everything from generating your NFT art and metadata, to deploying a smart contract without any programming.
Are NFTs worth the Hype?
I’m not a financial advisor, a certified financial analyst, an economist, a CPA , an accountant, nor a lawyer. All opinions are mine. Please do your own research.