NFT is the latest sensation in the virtual world after bitcoin and crypto. NFT stands for Non Fungible Tokens and the concept has certainly got much hype recently because of the exceptional versatility that it offers to the virtual world. If you are getting confused that it’s something the same as bitcoin or cryptocurrency then let me clarify that Bitcoin is fungible; that means all tokens have the same value whereas each NFT is unique in value.
As we all know NFT stands for Non-fungible tokens which are digital assets. It contain identifying information recorded in smart contracts. Each information that makes each NFT unique that cannot be completely or we can say directly replaced by another token.
NFTs simply resemble unique assets with an irreplaceable value. It can be anything from an art piece, music, tweet, or even a trading card that has a unique value attached to it. NFTs are a kind of digital display container with all forms of digital information in them.
Once, an NFT creator stores all kinds of information to a particular category, it can be easily minted (coined in the blockchain) and all the information stored in it becomes intact forever. This unique concept of fungibility is gaining much attention among worldwide investors. In this blog, we will offer an in-depth analysis of this unique concept so that you get acquainted with its major advantages and challenges.
How to Invest in NFTs?
As mentioned above, NFTs are unique assets that have digital ownership that is attached in form of a token. Blockchain is the network on which NFT trading takes place where you can easily create NFTs for any kind of artwork and list them on NFT marketplaces.
The point to be noted here is unlike Bitcoin, the value and ownership of NFTs just can’t be substituted by anything else. Investing in NFTs is quite risky because of their high volatility. An NFT collection may lose its value with time due to a weak community or due to the lack of liquidity in the NFT market.
You need to explore the concept and dig deeper to get crucial insights into it. Keep in mind that your primary target should be to buy cheaper NFTs that can be easily flipped over time to gain maximum profit.
OpenSea, Rarible, and Mintable are some trusted NFT marketplaces where you can easily trade NFTs. It’s not that NFTs are restricted to artworks only, you can create an NFT on anything like concert tickets, gaming apps, content, or almost anything that you think you can create with your expertise. You just have to look for some trendy NFT collections and sell them when you find the best price for them.
What Value Do NFTs Contain?
Generally, NFTs don’t have any intrinsic value nor the value is decided by the NFT creator or any company, rather, it is what people agree to pay for them. It is open to people and their preferences that how much they want to pay for a particular NFT. Currently, digital art NFTs have gained much hype and are sold for millions of dollars. One of the most expensive NFTs that was recently sold was Christie’s arthouse which was sold for USD 69.3 million.
The thing to be noticed here is that not all NFTs are so valuable, hence, you must carefully research the kind of NFT you are going to trade in and also look for its community support before making any decision on it.
Do Your Homework!
We understand that you will never like to risk your hard-earned money on something that is not very usual to you. So, before buying an NFT, you must do your homework well to ensure profitable outcomes. Look for some popular NFT tools, check the project’s community on social media, check its website and founders, and then proceed with the best supportive community to assure high returns on your NFT investment.
Just two decades ago, no one ever thought that the internet will become an integral part of lives, it requires foresightedness and an immense prudent approach to invest in something that is highly volatile and risky. Hence, we recommend conducting in-depth research and then making a well-planned strategy to become a key player in the world of NFTs.