NFT markets can seem scary to a lot of people, but in reality, they are almost like any other market — one of the differences being that most of the action happens on the blockchain, and you have to be connected to one to be able to transact them. Also, the markets are a bit less regulated and somewhat volatile. That is not necessarily a bad thing, however; volatility works both ways and if you get really good at identifying good projects, you might be surprised by the results you get. Here are some tips for finding great NFT investments.
Understand How the Markets Work
NFT markets operate like no other market. You won’t see news about NFTs in major publications, so you will have to dig a little deeper and get involved in the community to know what is moving the markets. There is no other way around it.
You will have to find a good NFT newsletter, and start gathering information about upcoming projects. You will then have to go on communities like Reddit and chat with the people there. You should also be subscribed to a few YouTube channels so you can catch any buzz about a project. This is the kind of information that will allow you to tell if an NFT project has a chance of taking off.
Look at the Person or Team Behind the NFT
You should never buy an NFT without looking at the people behind them. NFTs have stories, and these stories are often attached to the people involved in the project.
If you are going to buy an art NFT, you need to research the artist. You have to know the significance of this artist in the NFT community or the art world. A well-known artist or one that is up and coming will garner more interest than someone who is unknown and unrecognized. If you are looking for another type of project, you have to know how respected the creators are and the cultural significance of the project.
Some projects had very specific goals, like allowing content creators to make money from their work or saving the planet. These projects have more cultural significance than randomized pictures of Apes or Lions. The people behind the NFT will be the main driver of value, so you have to know who they are before you invest in anything.
Do Not Overlook Memes
With that being said, that does not mean that there is no money to be made with Ape NFTs. After all, Bored Ape Yacht Club is still the most expensive collection to date. You should probably wait until you have a better understanding of NFTs before you start getting involved with them, however, since gauging value and timing trades is much trickier.
These are all things that will help you to better identify good NFT projects. Start by doing some research into what NFTs are exactly, and begin with small trades until you get better at it.
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