As the blockchain space continues to grow and evolve, the use of non-fungible tokens has become the talk of the town. NFTs have revolutionized the world of digital art and collectibles, as well as many other industries. These digital assets have also become a source of income for many people, such as artists, collectors, and investors.
Currently, there are thousands of promising NFT startups and collections to invest in. But this is not the only way to make money with NFTs. Are you wondering how to take advantage of them and earn some money? Then you’ve come to the right place.
In this article, we will discuss a variety of remarkable investment methods and strategies.
An NFT, or non-fungible token, is a unique crypto token stored on a blockchain that can’t be duplicated. NFTs are virtual assets that represent artwork, in-game tokens, memes, music, real estate, tweets, etc. NFTs serve as certificates that prove the authenticity of digital assets and the ownership of real-world objects.
To better understand the concept, let’s define tokens. Tokens are virtual assets that store value on a blockchain and are governed by smart contracts. Most tokens on a blockchain are fungible assets, meaning they are completely interchangeable and indistinguishable from one another.
Non-fungible tokens allow users to create unique data on a blockchain. In other words, NFTs hold their own codes and are thereby scarce. Therefore, an NFT is one-of-a-kind and doesn’t have a recognized market price. It also can’t be exchanged for an equivalent asset.
Let’s take a closer look at some NFT statistics and top NFTs.
One of the most efficient ways to make money with NFTs is to create and sell them. As an artist or content creator, you can turn your artwork into unique and tradable assets. Creating an NFT is easy because all the necessary infrastructure is already in place.
First, you need to choose the asset you want to sell and mint it on a blockchain. If you are an artist with a portfolio, consider creating some of your best pieces as NFTs and offering them for sale as 1:1 NFTs. The 1:1 NFT market is significantly smaller than the NFT collection market, so you are more likely to find buyers for your high-quality artwork. You can also launch your own NFT collection.
Then you need to choose a blockchain platform to publish your NFTs. Ethereum is the most popular platform among various NFT marketplaces. However, it has the highest transaction fees. If you want to reduce transaction fees, choose Polygon or Solana.
Next, select an NFT marketplace and connect a digital wallet. Make sure they are compatible with the blockchain on which your tokens exist. In fact, some NFT marketplaces, such as OpenSea, Rarible and Nifty Gateway, allow users to mint and sell NFTs. These platforms typically offer different features and fees, so be sure to research and compare them before choosing one.
Once you have created your NFT and selected an NFT marketplace, it’s time to sell your digital assets. The price of an NFT typically depends on several factors, including demand, rarity, and the artist’s reputation. It’s important to price your tokens competitively and then promote them to potential buyers. In fact, Discord, Twitter, and other social media platforms can be powerful tools for promoting your NFTs to a wide audience.
However, you can also sell your non-fungible tokens through an auction where potential buyers can bid on your NFT, and the highest bidder wins. Selling your tokens through an auction may create a sense of excitement and competition among buyers, potentially increasing the price of your NFTs.
Some NFT marketplaces and exchanges support both auctions and fixed-price sales, so you can choose the method that works best for you.
Renting NFTs is the easiest way to generate passive income with NFTs. NFT renting is the process by which people who don’t own a particular NFT but want to use it temporarily borrow the token. When the rental period is over, the NFT is returned to its owner. It can be very profitable if you own sought-after NFTs.
To rent your NFT, list it on an NFT marketplace and set your negotiation terms. The terms usually include the rental rate, period, fees, and other conditions as required by the platform you are using. All rented NFTs are governed by smart contracts, which sometimes oblige borrowers to provide collateral before making an agreement. Therefore, the agreement only becomes valid when the terms and conditions are met.
NFT staking is another way to generate passive income. Similar to cryptocurrency staking, you can deposit your non-fungible tokens into a DeFi smart contract to earn rewards. To do this, you lock your digital asset in a staking pool for a set amount of time to earn rewards or interest each cycle. While your NFT is locked, you still have ownership rights.
However, you cannot withdraw your tokens until the staking period is over. If you withdraw them early, you won’t receive any rewards.
Rewards depend on the length of the lock period, the platform’s daily or weekly rate, and the number of NFTs you have staked. The type of NFTs you lock and the platform you choose will also affect your future rewards. Rewards are paid out in the platform’s native token, which can later be exchanged for fiat or cryptocurrency.
To start staking, all you need is a wallet to receive the reward and connect it to the platform you want to use.
NFT royalties are fees or percentages paid to NFT creators each time their works are sold or exchanged on the market. Technically, royalties are conditions added to the metadata of NFTs during their creation. The average NFT royalty is between 5% and 10%.
Unlike in traditional industries, NFT artists have full control over the conditions they set, and royalties are paid automatically in a reliable environment. Therefore, NFT royalties are always paid to the parties to whom they are entitled, as specified in the smart contract.
Setting up a royalty on your NFT is a great way to generate a new revenue stream. However, this is not exactly a guaranteed source of income, as the number of royalties depends on the NFT owner’s desire to sell the asset and the presence of an interested buyer.
Some platforms allow NFT owners to submit their digital assets for loans from lenders, who receive interest as a reward during the loan period. Generally, NFT loans help increase liquidity in the NFT market and allow NFT owners to put their assets to work.
To access loans, borrowers must put up their NFTs as collateral. The value of such NFTs is also assessed by reviewing their past performance and other factors. Therefore, a borrower can pledge up to 50% of the value of their NFT as collateral for a loan, with the interest rate ranging from 20% to 80%, depending on the value of the underlying asset.
Once the parties reach an agreement, the collateral is transferred to a digital vault for the duration of the contract. If the borrower doesn’t meet the terms of the agreement, they can lose the asset because the lender has the right to take ownership of the collateral at a significantly discounted price, increasing the overall profit from the lending process.
By selling their NFTs on marketplaces
NFT creators don’t have to be artists. The most obvious way for them to make money is to sell their NFTs on various NFT marketplaces. There are many solutions and tools that allow creators to mint their own NFTs and then list them on popular NFT marketplaces. What’s more, NFT creators can earn royalties every time their token is sold.
By selling their NFTs as a membership pass to a specific community
As you already know, NFTs are not just about digital art. The utility of an NFT is a significant factor in why enthusiasts are interested in purchasing a particular NFT. An NFT can serve as a membership pass that grants access to an exclusive community.
What’s more, NFTs provide additional value to their owners. Even after a membership program ends, holders are likely to keep these tokens, which may have inherent value even without a membership program.
By selling their NFTs as exclusive access tokens
NFTs can also be used to provide access to special events, lectures, and other activities. This utility is not the same as a membership program because NFTs that serve as access tokens are more limited in scope.
For example, an NFT creator can sell an NFT as an access token to a tet-a-tet meeting with themselves. If they already have an established audience, this opportunity is likely to be highly desirable.
By dealing with brands
Brand deals and promotions are also a great way for NFT creators to make money. Large companies may be interested in partnering with your NFT project to leverage your audience and reputation to promote their brand. This is why this earning opportunity is available to projects with a large community of supporters.
You can invest in NFTs just like you invest in traditional enterprises, or you can become a venture capitalist and fund new companies. However, long-term investment in NFTs can be much more difficult than one-day trading.
If you want to invest in NFTs for the long term, you should thoroughly research the creator and their future project. However, many Web3 enthusiasts often hand over large sums of money to random people who promise to make them rich quickly. Investing in someone without any information is the fastest way to lose your money and your faith in the technology as a whole.
To protect yourself from scams, follow a few basic rules. First and foremost, find out as much as you can about the creator and their background. Second, check their work history. These factors can help you predict the long-term performance of your investments.
Therefore, investing in an NFT with a long-term perspective requires considerable study, patience, and even intuition. Keep in mind that when you invest in an NFT, you invest in its creators.
Trading NFTs is an efficient way to make money from digital assets. You can buy an NFT and then sell it for a higher price.
However, it is not that simple. The trick is to sell the token at the right time, which depends on several factors, such as the type of token, why you bought it, and whether there is interest in the NFT. In fact, you can quickly research various marketplaces to find relevant information related to these factors.
You should understand that the NFT market is not as liquid as other crypto markets. Hence, it will take more time for you to sell your tokens. You may also have to adjust your asking price often to find a buyer. However, if you own an NFT from a no-name collection, you may not find a buyer at all.
Play-to-earn NFT-based video games are another popular approach to earning money with non-fungible tokens. Blockchain-based games allow players to purchase and trade in-game items represented by NFTs.
Currently, there is a wide variety of play-to-earn games on the market. It’s a good idea to choose a game with compelling gameplay. In addition, your earning potential in these games may depend on your skill level or the amount of money you’re ready to invest to get started. For example, holding more powerful items may allow you to earn more tokens.
The drawback of play-to-earn games is that they don’t work well for creating a sustainable model for tokenomics. Therefore, if a game suddenly becomes extremely popular, the supply of its reward tokens may inflate, resulting in lower prices and less valuable rewards.
You can turn physical collectibles into NFTs, sell them, and start making money immediately. The technology allows you to securely store your physical collectibles as virtual assets on a blockchain and receive at least the same price for them. Digital tokens can be easily copied, but the concept provides secure and reliable proof of ownership.
Sports cards are the most popular type of licensed NFT collectibles. However, brands are gradually jumping on the NFT hype train with their licensed collectibles to reap the most benefits.
So if you want to make some fast money, convert physical collectibles into NFTs and then sell them.
This original concept is made possible by NFTs, which are now key components of automated market makers. Yield farming is a new cryptocurrency investment strategy that allows you to earn interest or rewards by providing liquidity to a decentralized finance (DeFi) platform. This innovative idea allows investors to earn high returns on their investments in a short period.
You can use your digital assets on multiple DeFi platforms to generate the highest possible returns. This can be a great way to diversify your investments and earn rewards from NFT-based projects. However, the DeFi space is mostly unregulated, so there are several risks and challenges associated with yield farming.
NFT holding refers to the practice of holding non-fungible tokens as an investment. This strategy is attractive to investors because it offers potentially high returns with relatively low levels of risk. Unlike traditional investments, NFTs are not susceptible to market volatility and can be held for long periods without worrying about price fluctuations.
Holding NFTs is very similar to investing in stocks and other assets. However, this option allows you to trade or resell your digital assets quickly and with low transaction costs. What’s more, NFT holders can benefit from the appreciation of their tokens as the market for that particular asset grows.
Linking physical assets can help you make money and change the way we interact with physical assets. To tie a physical object to a specific digital asset, the technology uses a unique code that controls the ownership of a physical asset by verifying its authenticity. This process is known as tokenization.
Tokenization refers to the creation of digital tokens that represent assets on a blockchain. Non-fungible tokens can represent artwork, cars, houses, land, precious metals, etc. Asset tokenization makes real-world assets more tradable and accessible to a wider range of investors. Therefore, investors can buy and sell NFTs on an exchange without having to physically own the underlying asset.
The stock market makes us believe that we can only buy whole shares. However, the blockchain space tends to break the established rules, and NFTs are no exception.
With NFTs, you don’t have to buy the entire NFT collection or even the entire token. NFT creators can divide the ownership of their artwork into smaller pieces and sell them as tokens using the fractionalized ownership concept. This allows many investors to own a piece of a particular digital asset.
What’s more, fractionalized NFTs enable investors to own a piece of high-value NFTs. Just like in the traditional art world, you don’t have to buy every Picasso in the world. Instead, you can choose to buy a single Picasso or a print of a Picasso if you wish.
Another way to make money with NFTs is to choose a project that offers rewards, such as NFT giveaways. In particular, projects like Lucky Block give real-world rewards for buying and holding one of their tokens.
Each Lucky Block NFT collection is linked to a competition. For example, the 1MHOUSE NFT collection consists of 10,000 tokens and allows token holders to enter a competition where one lucky participant could win a $1 million property.
Other NFT competitions allow players to win a brand new Lamborghini or $1 million worth of Bitcoin. Each NFT collection offers lifetime rewards as long as the tokens remain in the investor’s digital wallet.
In the Lucky Block ecosystem, rewards come in the form of the native LBLOCK token. In general, this approach allows users to earn passively with NFTs. What’s more, as the value of the NFT increases, the investor can trade it on a marketplace.
HODLing NFTs refers to investing in a cheap NFT project and holding it for a long time. The concept here is that following a long-term strategy will protect investors from short-term market fluctuations.
In addition, a long-term strategy gives a particular NFT collection time to succeed in the market. Because the NFT space is highly competitive, it can take months or even years for a project to become widely known. Moreover, most NFT collections need time for increased demand to catch up with supply.
However, now is the best time ever to invest in NFTs for long-term gains, as many NFT collections have a floor price that is more than 50% below its previous peak. By purchasing a high-quality NFT at a heavily discounted price, you have the opportunity to make a significant return on your investment.
NFT flipping is another way to make money with NFTs. Flipping refers to the process of minting NFTs at a low price and selling them at a higher price. Flipping typically has a short time frame and can be applied to valuable tokens. It can be difficult to choose the best NFT to invest in and sell for a profit, especially with the level of competition that exists in today’s market.
NFT flipping is a quick way to expand your investment portfolio. Buy as many NFTs as you can when they are cheap to have the best chance of making money when you sell them. For those interested in NFT flipping, it is necessary to research the market, understand the risks involved, and develop a strategy for buying and selling NFTs.
The most obvious way to make money with NFTs is to create your own tokens and sell them. The process of creating an NFT is called minting. The cost of minting NFTs is usually low, so anyone can create thousands of tokens for very little crypto.
Currently, there are many NFT marketplaces where you can sell your NFTs. However, you don’t have to list your tokens on a marketplace to sell them. Nevertheless, people who buy NFTs usually look for them on marketplaces.
Once you list your NFTs on a marketplace, you wait for someone to buy them. Since there are millions of NFTs on every marketplace, you need to make your tokens desirable and create a buzz around them through social media. Then there is a chance that someone will ever buy your NFTs.
Although there are numerous benefits to investing in NFTs, there is always a flip side to the coin. Let’s take a closer look at the potential risks associated with NFTs.
Copyright and intellectual property issues
If the NFT creator does not have the right to tokenize the asset, there may be potential legal issues regarding the copyright and intellectual property rights of NFTs.
Environmental concerns
Some NFT platforms run on energy-intensive blockchains, leading to concerns about the environmental impact of NFT transactions.
Fraud and scams
As with any burgeoning market, the NFT space is plagued with fraud and scams. For example, some bad actors sell their own tokens in order to inflate the prices of their NFTs. The main rule is to be cautious and double-check all details before making any investment decision.
Lack of liquidity
Some NFTs sell very slowly, especially when there is little demand for a particular asset or when the market is experiencing a downturn.
Market volatility
The NFT market can be very volatile, and prices can fluctuate rapidly. On the one hand, this can lead to substantial profits. On the other hand, significant losses are also possible.
Like most other blockchain experiments, the future of this one is relatively unknown. According to publications in well-established journals, NFTs don’t seem to be going away anytime soon. Now that wealthy investors are putting money into them, it’s likely that NFTs will become more widespread.
With the ability to sell the right to use assets without giving up ownership, this could be the next big thing in music distribution. To enter the market with the least risk, anything innovative that you own is potentially valuable.
Anything can be an NFT, such as game sprites, the music you’ve recorded, pictures you’ve taken, prominent accounts on various sites and forums, and more. With the growing scope and market for NFTs, we will likely see even more ways to make money from non-fungible tokens in the future.
Making a profit with NFTs calls for some strategy and patience. It also requires thorough research and a deep understanding of market trends and what collectors are looking for. These are the keys to success in the NFT space.
But this is just the beginning of a new era. As the technology matures, we will see more ways to make money from NFTs. But you don’t want to wait and miss the opportunity, do you?
In that case, don’t hesitate to contact our team. We have a deep understanding of blockchain and NFTs and always keep our fingers on the pulse of market trends. We are ready to help you from the very beginning of your NFT journey and help you choose the best method to diversify your income.
