Interest in non-fungible tokens (NFTs) continues to grow. According to Google Trends, the number of search queries on this topic reached an all-time high in early December, and now it is at close to record levels. Amid the growing popularity of the theme, a major developer of computer games Ubisoft announced the launch of its own NFT marketplace. It will sell digital goods called Digits, each of which will receive a unique number.
Athletes, musicians and other celebrities issue their own NFTs, which popularizes the field of non-fungible tokens. Against this background, the market is actively growing, but it is extremely difficult for an unprepared person to understand it. Experts told how to choose NFTs for further sales and is it possible to make money on it?
How to choose an NFT?
In the classic art market, there are art historians who evaluate works and set a certain price. Art lovers, collectors rely on professionals to buy creations, said Erachain’s product manager.
There is no authoritative figure in the world of crypto-art (the ideology of decentralization is manifested in this, there is no master of the position, dependence, patronage and rules), the expert added. The artist lists the NFT at their price, then the next buyer sets their price and waits for someone to agree with it.
When choosing NFT, she advised me to visit marketplaces that have a curatorial selection. You can subscribe to well-known illustrators, designers and buy their work – in this case, you will have to start understanding the topic a little, visit a couple of exhibitions of contemporary artists, many of them are trying to sell their NFTs.
The senior analyst suggested two NFT selection strategies:
The first strategy involves buying NFTs from obscure but up-and-coming artists, illustrators and developers. However, such a strategy implies the presence of a large expertise in some direction, so that it is possible to assess the prospects of the authors. This is comparable to the work of a football coach who is trying to see young talents. In any case, such investments will not bring much money in the short term, but successfully purchased tokens can grow exponentially following the growth of their author’s popularity in a few years. This is the strategy of an ordinary art collector, transferred to the digital world.
The second strategy involves the purchase of gaming NFTs that are used in a particular ecosystem: for example, for upgrades, reproduction, or the creation of new “artifacts”. In the case of game tokens, you should collect collections and use the internal mechanics of games to increase their value before selling. This method brings less income, but the transaction cycle in them is much shorter. But it will take a lot of time to learn the mechanics of games and profitable ways to combine tokens into some more valuable collections.
Is it possible to make money on the resale of NFTs?
Buying and selling NFTs as income is somewhat similar to regular collecting. According to him, in theory it is possible to put the activity on stream and turn it into a profitable business, but this requires expertise and high involvement. Just as a hobby, this method is unattractive. This can bring a lot of money in the moment, but only if you’re lucky. such a business cannot be called a stable source of income, such as the same trading with fungible tokens, the expert is sure.
One of the options for making money on NFT is to become a crypto-art dealer, Buidalina believes. In order to buy from you and agree with your price, there is only one way – to develop your taste, immerse yourself in the world of art, be the new Sergey Schukin of the crypto industry and collect the best collection of modern digital art, the specialist concluded.