NFTs are trending big time again, so I wanted to write about buying NFTs and what you should look for when trying to find the best NFT collection. I know, the temptation to ape into the first thing you see is real as NFT fomo kicks off, but here are some things you need to keep in mind!
Buy From A Trusted Marketplace
First, make sure you are buying from a trusted market place like Open Sea!
*** As a note, Open Sea has a verified blue tick for top collections. Fraud is rampant in the NFT space. So, if you are going to lay down thousands of dollars for an NFT, then make sure you are getting the real deal! Newer and lesser-known artists lack this blue tick. But it is useful for those looking to get NFTs like Crypto Punks or Hashmasks.
*** As another note, it is not necessary to chase every opportunity in crypto. You can trade, or yield farm, or flip low cap gems and be very profitable and never get anywhere near NFTs.
*** And one final note, before we dive in! Do consider the opportunity cost, ETH will likely get up to 5 digits one of these days, will your NFT buys outperform that?
Find Your Niche
Next, choose your poison…. I mean passion! And yes, this is an important part of the equation, you should actually get things you like! For example, I am not a big sports fan, so I won’t be looking at any sports NFTs, but I do like collectibles and art!
Sports has been a big growth area for NFTs with most major sports leagues getting into NFTs. Chances are, whatever sport you love you can get NFTs for your favorite players or teams. Think of them as digital trading cards. The top sports card today can bring in millions. You want to know what is crazy? Sports NFTs are already fetching higher prices than cards.
Looking to find the best NFTs in sports? Check out our article on the Top 6 Sports NFTs.
Collectibles seem to be one of the best NFT growth areas right now. Crypto Punks, Bored Apes, and Art Blocks all soared in value over the last week. These crypto native collectibles are definitely capturing the money of big pocketed investors with Crypto Punks now selling for hundreds of thousands and millions. Some of the collections are establishing themselves as the premiere digital collectibles on par with the kind of prices and hype we see from other major non-NFT collectibles.
Art is a very nebulous world. What art has value? Why? I never understood why Malevich’s Black Square is even considered art let alone why such pieces like his Suprematist Composition fetched 87 million at auction! Now you may say: but Lark, it is real canvas, real paint, of course it is valuable! True, but it is also super hard to authenticate physical art and the industry is rife with forgeries. Anyway, if art is your thing, and you are looking more exclusively for art pieces, then of course you can find great stuff on Open Sea, but you may also want to consider Super Rare, which focuses much more specifically on art.
Music is an exciting new area of growth for NFTs. Imagine owning a first-edition vinyl record from your favorite musician. Well, we now have the digital equivalent of that! This is one of the newest areas of NFTs, so time will tell how valuable these pieces become.
Trading Card NFTs
Trading Cards have long been a big and exciting space for collectors and players. Games like Magic The Gathering have proven beyond the shadow of a doubt the value of rare trading cards. Now we live in a digital world, with verifiable scarcity. The question becomes: what games can find the kind of success that Magic did? Because there were a lot of CCGs in the 90’s, but only a few went on to make it with dozens of games essentially failing to accrue any value or retain players long term. I suspect that crypto gaming will be exactly the same. The stand out here is Gods Unchained.
Virtual World NFTs
Virtual Worlds like Decentraland offer players the chance to buy real estate in their virtual world. Crazy, I know, but historical returns have been very good on virtual land. Decentraland land and Axie Infinity Land have both done well. My Neighbour Alice is another to keep an eye on for land sales. I am also watching for when Wilder World starts land sales.
Looking to find the best NFTs in the virtual world space? Check out our article on the Best Metaverse NFTs in Crypto.
Final Thoughts on Finding the Best NFTs
While popular NFTs are going insane in prices, you are not likely to make as many gains by buying an NFT that is at all-time highs. You will want to likely seek out newer collections that haven’t seen a surge in prices yet. Or, if you are buying expensive NFTs, then make sure you are getting high-quality ones. Think of it like this; Magic The Gatherings Black Lotus and Pokemon’s Foil Charizards just keep going up in value. The best NFTs will likely do the same. Question is finding the right ones! Remember, the majority of these NFTs will retain no value over time and some will go on to reach insane price heights. This market is very, very speculative. You should assume you will lose most or all of your money invested in any NFTs. This is why, of course, never invest more than you can afford to lose and why you should never buy an NFT that you don’t actually like! Because, if all else fails, at least you will have a JPG file that you like!