Non-fungible tokens (NFTs) have exploded in popularity, and that has made investing in them all the more challenging. Here are 12 tips on how to spot the best NFT projects.
The space of non-fungible tokens (NFTs) has grown exponentially over the past year, and this produced quite a few consequences.
For once, there are thousands of NFT projects spawning every single day, and the entire space resembles a lot of what we’ve seen during previous hype cycles with initial coin offerings (ICOs), initial DEX offerings ( IDOs ), initial exchange offerings ( IEOs ), and whatnot.
The general consensus is that non-fungible tokens are here to stay and are going to play a pivotal role in sub-niches such as blockchain-based gaming that’s currently represented mostly by the play-to-earn model.
However, those of you who’ve dug a bit deeper into the NFT universe undoubtedly notice the increasing number of scam projects, or NFT creators who are here ‘only for the money,’ and how hard it’s becoming to pick an NFT collection that has the chance of becoming successful.
With this in mind, we’ve taken the opportunity to provide you with a few things that you should consider when choosing to ‘ape’ in a new collection and how to pick the better ones.
Let’s dive in. Team: Expertise and Partnerships
Over the past few years, we saw an exciting phenomenon came to prominence within the cryptocurrency community, and that’s anonymous founders. While considered a massive red flag in the past, this requires a bit more digging in the present.
Just because the team is anonymous doesn’t mean that you should dismiss their NFT collection. Remember – the Bored Ape Yacht Club was created by a completely anonymous teamand no one knew their identity for a long time before they were brought to light supposedly against their will. By the time this had happened, however, BAYC NFTs were at peak prices (floor price above $300K per ape), and no one had any doubts in the team. Bored Ape NFTs. Source: NFT Culture In other words, instead of looking to verify the team’s identity – try to verify their accomplishments and credibility. Anonymous developers can still be very professional and dedicated. And public teams can also end up being scammers. Therefore, instead of blatantly making a call based on these criteria, try to research deeply and find out whether or not the team has merit behind it.
Another thing to consider is if they have any disclosed partnerships and collaborations. These can be partnerships with other companies or maybe with some well-known and well-received developers with proven track records. Community
If you ask anyone about why BAYC is so successful, they will probably say that one of the reasons is the community behind it. People resonate with the BAYC brand and are proudly wearing their Apes as profile pictures and on merchandise.
A community that’s doing its best to represent the collection and, even more – to push it further is something that you should definitely look for when choosing a project to invest in.
However, be aware that the NFT community is primarily in Discord, and there are many projects who tend to use bots to artificially inflate the community and make it appear as a vibrant one. Bots are easily spotted as long as you do proper research.
Be a part of it – observe how people behave and participate in conversations to assess their quality. A proper community attempts to add value instead of asking the blatant questions – “wen mint? Wen moon?” Roadmap
Good projects tend to have considerate roadmaps. Although this might not always be the case, and it’s not to say that all good projects start off with a roadmap, but more often than not – they would.
You need to see how achievable the roadmap is and look for massive promises in ridiculously low timeframes. If you spot something of the kind, it might be a good idea to reconsider. Good projects grow steadily, and they do not rush deliveries – they prefer quality over quantity, and they don’t rely on every new code push to pump up their floor price. Artwork
Looking for artwork that’s unique used to be a good bet, but nowadays, that’s really not enough. It needs to be recognizable, albeit a derivative. For example, the Bored Ape Yacht Club launched another NFT collection and airdropped it to BAYC holders – the Mutant Ape Yacht Club. Although a derivative, it’s unique in that BAYC NFTs can also be subjected to the Mutant Serum and […]
source Investing in NFTs: 12 Must-Read Tips to Spot the Best Projects
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