NFTs (non-fungible tokens) have been the latest buzzword in the cryptocurrency industry. The new niche in the blockchain industry has been capturing the headline in 2021 as artists, collectors, and investors embrace the art of investing in NFTs and make it into deals worth millions of dollar. In March 2021, the digital art of a flying cat (Nyan Cat) sold for $0.6 million. A few days later, Christie’s auction would sell a collection of arts by Mike Winkelmann’ (“The first 5000 Days”) for a whopping $69,346,250. The sale drew people’s attention to NFTs, yet it was the beginning of a series of multimillion sales in this niche. About two weeks later, Twitter founder Jack Dorsey sold his tokenized first tweet for $2.9 million. Since these initial sales happened, many artists, speculators, and collectors have flocked the market tokenizing and trading nearly anything. NFTs currently span arts (such as music, sports collectibles, antiques, videos, and pixel images) to intangible assets (such as patents, copyrights, and trademarks) to physical assets (such as gold and luxury cars).
NFTs are traded, and you can buy them during the launch (at a mint) or later during secondary sales on NFTs markets, from individuals, or at auctioneers companies. Buying NFTs early has many advantages related to prices, quality, risk, and available information. Here are some of the reasons you would want to invest in NFTs early:
You Enjoy Cheapest Selections
Why should you invest in NFTs? One interesting phenomenon about NFTs is how they can gain value over a short period. For example, CryptoPunks, a collection of NFTs on the Ethereum blockchain were given away free, when they first launched. Minters would only pay the minting fee and get a unique CryptoPunk. Currently, these NFTs have a floor price of 100ETH (about $4,100) at the time of writing. The secret, in this case, was investing in the NFTs early enough when the cost of acquiring one was low. Few NFTs will currently launch at zero dollars. However, the mint price is generally one of the lowest prices you will get an NFT at. Buying early and selling later when the price has increased is one of the best ways of investing in crypto NFT market.
You Get the Best Selection
Although NFTs are all unique, they still vary in rarity. Rarity affects the value of an NFT. Just like any other art or luxurious item, the rarer they are the higher their value. It is difficult to find a very rare NFT for a secondary buy since they are in very high demand. Moreover, even if you find one, their prices are usually high. The best time to get such NFTs is during the mint sale. Usually, the creators will set a mint price for their NFTs. The price has not been influenced by market speculations, which drives demand. Such price is reasonable and affordable since it drives demand. The most thing lesson is to learn best ways to invest in NFTs.
You Minimize Risk
Here is another reason to invest in NFTs. Most NFTs will increase in price as their demand increases from the time of launch. Some will have a consistent price rise, as in the case of some CryptoPunks. However, such a scenario is not a guarantee for all NFTs, since they are volatile assets. The prices of many digital assets will vary based on demand. Sometimes the prices may even drop below the mint prices, hence putting the early buyers at risk of losing their money. However, the mint price is usually set low compared to secondary sale prices. Therefore, a dip in price will have less impact on an early buyer than on a secondary buyer. For example, you may have bought an NFT at 2ETH, mint price, and another person buys it later at 4ETH. If the price dip to 1ETH, you risk losing 1ETH while the secondary buyer risks losing 3ETH. In such a case, early buying greatly minimizes the risk.
In another scenario, the price may remain above the minting price, yet still fluctuates significantly. For example, the price of a CryptoPunk may fluctuate by thousands of dollars. For a secondary buyer, such fluctuations have a far greater risk. You will not care so much if the price of an NFT drops from $10,000 to $4,000 when you bought it at $200. However, such fluctuations will mean a loss to the person who bought the NFT at $5,000.
You Access the Most Amount of Valuable Information
Buying early also allows you early access to information that helps in making the right purchase decisions. For example, if you were to purchase a Punk on Ethereum network today for a million dollars, would you know that the price would go up by another million dollars in the next six months? No. However, if you were to buy the Punk early, you would read the market trend and buy the NFTs without risking too much money. Additionally, buying early means the supply chain for the NFT is still short. You can have a lot of information about the creators, and their projects, which are key in predicting the future of an NFT project. Knowing the best plartform to invest NFTs for best results is also an important consideration.
You enjoy the honor of being the first Owner of an NFT
NFTs possess hedonic value as much as they have functional value. Traders usually exploit the functional value of NFTs, whereby they buy and sell NFTs for profit. However, as a collector, you may want to hold an NFT and flex it, hence exploiting the hedonic value of that digital asset. There is pride and satisfaction, which comes with imagining that you are the first holder of a famous NFT art. You can flex it and share it with your friends.
Can you invest in NFTs and earn profit? Yes! Just like cryptocurrency, NFTs are a legitimate investment opportunity that can earn you fortunes. Whether you are a trader or a collector, the best time to get your NFTs is at the early stages of their existence. You will be able to get high-quality NFTs at low prices with minimal risks. Now that you understand the benefit of investing NFTs early, you may be asking about the best platform to get early NFTs. Follow us and find all the latest NFT drops in the market.