Wondering where to invest next? Take a closer look at NFTs.
Non-fungible tokens have revolutionized our understanding of digital asset ownership and the representation of both digital and physical assets on blockchain networks. Thanks to their natural scarcity and provable ownership, NFTs now provide a unique means of facilitating the value of a variety of virtual assets, such as artwork, collectibles, music, and video game items.
Some of the most expensive NFTs are worth significantly more than masterpieces of conventional art. For example, The Merge by Pak sold for a whopping $91.8 million, surpassing the value of paintings by Monet, Picasso, and Van Gogh.
With such high stakes, more and more people are looking to jump on the NFT hype train. Read on to learn about NFT collections, discover which ones to avoid, and find the best NFT collections to invest in.
An NFT collection is a limited series of individual NFTs created by an artist or group of artists. Tokens in a collection are issued and sold in digital forms, such as music, tweets, videos, or game items, which are individually stored on a blockchain. Each non-fungible token has metadata that includes the artist’s name, creation date, title, and other relevant information.
Most NFT collections typically contain numerous NFTs that have a common artistic style, with slight variations in each particular token. The value of the NFT collection depends on the rarity of the tokens and the popularity and inventiveness of the creator. The price of each NFT also increases as more people want to buy others within the collection.
The Bored Ape Yacht Club collection is one of the most popular and valuable NFT collections in the world. It consists of 10,000 unique Ethereum-based NFTs representing digital apes with different characteristics. For example, only 5% of Bored Apes have red fur. Therefore, the rarer the features, the higher the price the NFT tends to fetch on the market.
In the NFT world, anyone can become a digital artist and launch an NFT collection. The barriers to entry into the NFT art scene are much lower than in traditional art because you don’t need a lot of skills or extensive training.
NFTs are created digitally, so novice artists can focus on graphic design and other computer-based skills that are much easier to master than becoming a professional painter. Also, many of the most successful NFT collections are quite simple in nature, such as CryptoPunks or Bored Apes Yacht Club.
As you can see, pixelated characters make up CryptoPunks avatars. They don’t require a high level of skill to produce or replicate. However, this illustrates that much of the value of NFT projects is not directly related to the creativity of their authors but rather to the ability of the artists to understand demand and trends and to promote their creations.
Certainly, this is not to say that there aren’t talented and skilled artists in the NFT space. Take Beeple, a digital artist who creates stunning NFT collections that offer provocative social and political commentary through insanely abstract images that would certainly be relevant in a modern art gallery.
I bet you’ll be surprised to learn that not all NFTs are created the same way. Some NFTs are used as fine art. Such NFT collections are designed just to look pretty and be admired.
At the same time, some NFTs can be used in blockchain-based games. For example, Axie Infinity is one of the most popular games where users can collect, breed, and train Axies, which are NFT-based digital pets. The game uses blockchain technology to inherit traits, strengths, and weaknesses for future generations of Axies.
Players can also complete quests and compete against other users to earn the platform’s native token, which is necessary to breed new Axies. You can also breed your Axies with others to create a family of NFT pets.
If your Axie has rare traits, you can offer it for breeding and receive a portion of the breeding price as a reward. The rarer your Axie’s traits are, the more money you can charge others to breed with your NFT pet. You can also build up your own NFT collection of Axies.
The stock market makes us think that we can only buy whole shares. However, the cryptocurrency space tends to break the established rules, and NFTs are also different from the rest.
Therefore, if you want to buy a non-fungible token, you can buy a single one. You don’t have to buy the whole NFT collection. Fantastic, isn’t it?
Imagine having to buy $1 million worth of NFTs if you wanted to invest. So, if an artist has a collection of 1,000 NFTs, you can buy a single token from that collection.
This is very similar to the traditional art world. You don’t have to buy every Monet in the world. Instead, you can choose to buy a single Monet, or a print of a Monet, if you wish.
If you’re planning to invest a large amount of money in an NFT, you may be thinking about creating more copies of the token to earn more. However, there are several reasons not to do this.
NFTs are non-fungible tokens, meaning that they cannot be duplicated or replicated by definition. If you buy an NFT that is a #1 of 1, then the artist has only created 1 item. If 10 copies suddenly appear on the market, people will know that the NFTs are not legitimate. You will be immediately blacklisted from the community, and your reputation will be destroyed.
However, you can fractionalize your NFT collection. For example, you can create 10 or 100 NFTs that give their holders a portion of the ownership of your NFT collection. Therefore, any wallet holding 51% or more of the new tokens you’ve created will be considered the majority token holder and the “legal owner.”
NFT fractionalization is a great way to invest in valuable NFTs. Just make sure that other people who want to invest with you are reliable and doing it for the same reasons you are. The worst thing is if others decide to pool their ownership and take the token away from you while splitting the profits.
Everyone wants to invest in NFTs and make a fortune as quickly as possible, don’t they? Unfortunately, not all NFT collections are valuable. Although there are several ways to make a collection worth money, it is nearly impossible for the average person to make an NFT collection valuable.
Let’s take a look at the factors that create hype for any NFT collection.
It is the artist’s reputation that has the greatest impact on the value of any given NFT collection. If an unknown artist creates an NFT collection with no prior history, audience, or social media following, it is extremely unlikely that they will be able to set a high market price for their artwork.
The next important factor is the people who buy items from the collection. When celebrities or other famous people purchase NFTs and share the news with their followers on social media, the awareness of the collection grows. As a result, more people will want to invest in the collection, and its value is likely to increase.
For example, Eminem, Gwyneth Paltrow, Post Malone, Snoop Dogg, and many other A-list celebrities have purchased NFTs from the Bored Ape Yacht Club collection. This has been one of the biggest drivers for the BAYC collection to go viral and dramatically increase in value.
Utility refers to the usefulness of a digital asset, typically a crypto token, and the value it brings to the entire ecosystem. Put another way, does the asset do anything, or is its price simply based on the speculation of other investors?
As for non-fungible tokens, some of them have a particular use case on the blockchain. For example, NFT collectibles and game items can be used in a video game to provide some utility to their owners. Some blockchain-based games allow players to compete for weekly rewards depending on their performance in battles with other players. The more powerful the NFT items, the more chances a player has to earn valuable rewards.
Just like traditional art, the rarer an NFT collection is, the more valuable it becomes. However, there are two ways to interpret rarity. First, digital artists can create unique works of art for each of the tokens in their collection. For example, Beeple created his “The First 5000 Days” collection this way.
The other way to create rarity is to follow a method similar to popular collections like Bored Apes, CryptoPunks, Doodles, etc. The authors of these projects didn’t create one-off tokens. They simply offer slight variations or features of each token. As a result, none of the tokens are the same, which means that each has its own visible value that attracts investors.
OpenSea is the world’s largest NFT marketplace, hosting over 80 million NFTs from a variety of categories, including digital art, collectibles, domain names, music, trading cards, sports, and even virtual worlds. The platform is built on the Ethereum blockchain, and so are most of its digital assets. However, OpenSea also offers NFTs from the Klaytn, Polygon, and Solana networks.
The marketplace allows users to buy, sell, trade, and mint digital assets. It supports multiple wallets and provides tutorials for beginners. However, OpenSea charges 2.5% per sale and is suspected of insider trading.
Rarible is an open-source platform for creating, buying, and selling digital collectibles, art, video game items, and other types of NFTs. The marketplace supports the Ethereum, Flow, and Texos blockchains. The platform provides a minting tool to seamlessly create NFTs without coding.
Rarible has a native token called RARI that allows its holders to vote on company decisions. The platform splits transaction fees between buyers and sellers (1% from each) and accepts debit/credit cards and Google Pay. However, it may be difficult for new creators to succeed, as Rarible is dominated by influencers.
Nifty Gateway is a platform that focuses solely on exclusive NFTs, mainly artwork and music. The marketplace attracts celebrities due to its premium price point. In addition, Nifty Gateway tends to collaborate with celebrities and launch exclusive drops. For example, the platform has partnered with Beeple.
Nifty Gateway supports fiat payments and has live customer support. However, it charges 15% per transaction and has only top collectibles.
SuperRare is an NFT marketplace that positions itself as a digital art gallery. As the name suggests, the platform focuses on high-end NFT collections and thoroughly vets tokens before they’re offered for sale.
SuperRare is a user-friendly marketplace with live customer support. It charges 15% the first time an NFT is sold on the primary market and has a flat 3% fee on each transaction paid by the buyer. SuperRare supports the Ethereum network only.
NBA Top Shot
As the name implies, NBA Top Shot focuses solely on NBA-related content. Namely, licensed video clips, memorabilia, player highlights, autographed trading cards, etc. The platform is backed by the NBA itself, ensuring a high level of credibility and security.
Built on the Flow blockchain, NBA Top Shot is a closed platform with competitive fees. Therefore, users can only buy and sell NFTs on the marketplace but can’t mint them. However, it is easy to make a purchase, as the app accepts debit/credit card payments and cryptocurrencies, including BTC, ETH, BCH, USDC, DAI, and FLOW.
Binance is an NFT marketplace that allows users to create, trade, and show off digital assets. It focuses on art, games, music, photography, and sports NFTs. The platform operates in more than 100 countries. It supports NFTs hosted on Ethereum and the Binance Smart Chain.
The marketplace has an outstanding “Mystery Box” feature that allows investors to purchase a mystery box containing a random NFT. This allows users to get a unique NFT at a lower price.
Binance is a beginner-friendly platform with cross-chain functionality and a flat fee of 1%. However, it doesn’t accept PayPal payments and requires KYC verification.
Axie Infinity is a turn-based, play-to-earn online game built on Ethereum. It allows players to breed, collect, and battle Axies, Pokemon-inspired digital pets. Each Axie can be purchased as an NFT. The game also features Smooth Love Potion, the project’s native token, which is awarded to players who win battles.
Axie Infinity is often considered the most played NFT game of all time, with more than 1.5 million daily active players. It also features the Axie Marketplace, a platform where users can purchase Axies.
Azuki is an NFT collection created by a group of Los Angeles-based artists. It consists of 10,000 unique anime-style avatars that are used as profile pictures in Web3. In addition, tokens from the collection allow their owners access to “The Garden,” an exclusive virtual space where artists, creators, and metaverse enthusiasts can collaborate on Web3 projects.
Azuki is a big name in the NFT market that has attracted enthusiasts and investors worldwide. The collection sold out in four minutes and generated huge revenues. Its strong presence on major NFT marketplaces, such as OpenSea, has strengthened its position as a valuable and in-demand collection in the NFT space.
Bored Ape Yacht Club
The Bored Ape Yacht Club (BAYC) is probably the most famous NFT collection built on the Ethereum blockchain. It contains 10,000 NFTs representing cartoon-like apes. Each ape in the BAYC collection is a unique digital collectible with specific attributes, appearances, and characteristics created by an algorithm.
Initially, each BAYC NFT cost 0.08 ETH. Since then, the value of these tokens has skyrocketed, with some NFTs selling for millions of dollars. Bored Apes token holders have access to members-only perks within the BAYC ecosystem. For example, token owners can access THE BATHROOM, a collaborative graffiti board with future areas and benefits unlocked by the community through roadmap milestones.
The BAYC collection was heavily influenced by CryptoPunks, the first project to create collections of characters with specific features and rarity levels. The collection has become extremely popular among collectors and investors. As a sign of its success, the Bored Apes have been used as profile pictures on social media, further increasing the visibility of the project.
The Cool Cats collection started as a single blue, hand-drawn cartoon cat. Today, the collection consists of 9,999 unique NFTs.
Token holders belong to an online community called “Cooltopia,” and each digital asset is ranked on a coolness scale. NFTs range from cool (lowest score, more common) to exotic (highest score, rarer). There are only 66 super rare and totally unique collectibles with no shared traits.
The CryptoPunks collection is recognized as one of the first NFT collections. It was inspired by musicians like Daft Punk as well as the punk and cyberpunk scenes. Each CryptoPunk is a 24×24 pixel image.
To tell you how popular this NFT collection is, let’s take a look at some numbers. It has sold over $2.1 billion in lifetime sales. Five NFTs from the CryptoPunks collection are on the list of the top 10 biggest NFT sales of all time:
Doodles is a colorful and vibrant NFT collection consisting of 10,000 unique tokens. It is built on the Ethereum blockchain. The collection features a variety of characters, such as aliens, cats, humans, and pickles, all designed with a beautiful pastel aesthetic. The project is supported by celebrities such as Steve Aoki and Pharrell Williams, so its popularity has grown significantly.
Driven by a community-oriented approach and a media push, the project aims to grow into one of the largest consumer brands in the world. Since its launch in October 2021, the Doodles collection has become one of the leading projects in the NFT market. In September 2022, the collection raised a staggering $54 million from high-profile investors.
What’s more, this NFT collection has experienced considerable success in trading volume, achieving over $500 million in secondary trading volume. The initial mint price of 0.123 ETH was chosen to ensure an initial supply of 420 ETH. The price of Doodles NFTs peaked in July 2022.
Loot is a text-based NFT collection consisting of 8,000 tokens that are simply white serif fonts on a black background. The NFT collection is marketed to Dungeons and Dragons fans, so the randomized lists define equipment suitable for playing in a fantasy world, such as dragonskin gloves or a “bronze ring of fury.”
Token owners are also left to their own devices, as images, statistics, and other features are “intentionally omitted for others to interpret.”
Larva Labs, the same creators behind CryptoPunks, dropped another algorithmically generated avatar project called Meebits. The collection was launched after the success of the CryptoPunks collection. Meebits contains about 20,000 unique 3D characters based on video game characters seen in Minecraft and other games.
The NFT collection sold 9,000 Meebits within 8 hours of its launch. Another promising highlight of the collection is that Meebits can provide functionality for using NFT as avatars in games, virtual reality, and the metaverse.
NBA Top Shot
The NBA Top Shot collection is an NFT project that allows basketball fans to purchase unique digital collectibles to show their passion for the game.
In general, NBA Top Shot offers NFTs called “NBA Moments.” The NFTs are official NBA highlight clips that you can use as trading cards. In other words, the collection recreates the tangible experience of collecting game memorabilia.
Pudgy Penguins is an NFT collection of 22,222 charming little Pudgys. In addition to being cute, the penguins are ferocious and fight evil. Token holders own the commercial rights to their Pudgy Penguin, and the online community of token holders is called “The Huddle.”
Not much is known about this project, but a metaverse launch is expected.
World of Women
World of Women is a female-centric network and a 10,000-piece NFT collection. According to their website, the digital collectibles are tech-art fronts “to increase diversity in the NFT space and create opportunities for anyone around the world to be owners, creators, and contributors in this new era of the web.” Community members have access to monthly art drops, discounts, pre-sales, lotteries, and annual festivals.
The NFT market is thriving, so it’s not surprising that it attracts scammers and other malicious actors looking to take advantage of unsuspecting victims. What’s more, the cryptocurrency space is mainly unregulated, so investors are always at risk.
Education is the best protection against potential scams. Let’s take a look at the most popular scams.
This type of scam involves malicious buyers changing the currency used to bid behind your back. For example, a buyer may bid 5 BTC for your NFT collection but send you 5 DOGE, which is significantly less. However, most NFT marketplaces have measures to protect against this type of fraud.
Bad actors may impersonate famous digital artists and attempt to sell NFTs that resemble the originals. As a result, fraudsters sell counterfeit tokens that have no real value to unsuspecting victims who don’t verify the seller’s identity.
These scams are designed to trick users into willingly revealing sensitive information, including passwords, seed phrases, and usernames that allow access to their NFT wallets. Phishing typically involves fake advertisements through spoofed websites and pop-ups.
Finally, a rug pull occurs when an artist hypes up a project to get investors involved. The artist then tries to sell their positions and cash out. When the original creator leaves the project, the value of the NFTs falls, leaving investors’ money in tatters.
1. Tell a compelling story
First, you need to understand why people should buy your NFTs. Explain how your NFTs are different from other tokens, how exclusive they are, and what value they bring to the customer.
Successful NFT projects answer these questions first and foremost. Furthermore, the most successful NFT projects tell powerful stories to ensure that their audience shares the same values. For example, BAYC created a world where people could only join by purchasing their NFTs.
2. Choose your blockchain & marketplace
Most NFTs are minted on the Ethereum blockchain and sold on OpenSea. However, it’s worth exploring other options.
Selling NFTs from your own platform gives you more control over the NFT launch, allowing you to earn more and often avoiding the high gas fees associated with Ethereum. However, it also involves more work and related expenses.
Choosing a blockchain is also important, as each blockchain has different benefits and strengths. Some blockchains are more environmentally friendly, others offer interoperability, and some have lower gas fees.
3. Set up smart contracts
The next step is to write your NFT smart contracts. You need smart contracts to propose the value your NFT collection will give buyers.
You need to decide the maximum mint amount, whether you will take royalties on NFT resales, what the built-in features are, etc. These decisions are critical because features such as rarity, royalties, and mint amount are fixed after the initial minting.
4. Build hype & community
Launching an NFT collection is always about building hype and community around it. The more excitement that surrounds your NFTs, the more value they will have.
When it comes to NFT collections, success is a quick sell-out. However, building a community that believes in the project is not enough for a successful launch. You need to get as much visibility for your collection as possible, so make sure you deliver fresh and engaging content to keep fans excited and ready for launch day.
5. Create fairness for fans and customers
The NFT economy is driven by creators and the community, so it is important to create a fair NFT launch and show customers that your project is reliable. The best way to drive community engagement is to give as many people as possible a fair and easy NFT launch. Therefore, a fun and fair NFT launch creates a large and diverse holder community that supports your project, which is the key to long-term success.
6. Know your customer
Know Your Customer (KYC) is used to prevent illegal activities such as terrorist financing, money laundering, and tax evasion. It allows businesses to authenticate each customer so that no one can exploit the sale through multiple devices, proxies, or shopping bots. KYC also makes NFT launches fairer and prevents server overload.
7. Prepare your staff
Your project is most visible on launch day, so ensure that your entire team is prepared. Make sure all key partners and third parties are aware of the launch, that customer service is ready, that technical support is monitoring issues, and that you have a place to quickly gather and resolve issues.
8. Ensure your website is prepared for high traffic
If your website is unprepared for traffic surges, its crash can collapse your sales. Therefore, you need to find a solution to control the traffic caused by the generated hype. Virtual waiting rooms play an important role in releasing high-demand NFTs.
9. Create lasting value & innovate
NFTs attract people because fans and community drive their value. Thus, you need to create lasting value to keep customers and hype around your NFTs. For example, when people see the value that original holders get from certain tokens, they are more likely to participate in the next release.
Whether you’re an investor or a digital artist, the NFT space offers a wide range of opportunities to connect, engage, and trade virtual assets with people around the world. Although still in its infancy, the concept is growing rapidly and provides all the tools necessary for people to monetize digital art.
There are thousands of NFT collections from thousands of artists. Some collections are worth millions, while others are worth pennies. However, it’s up to you to decide if the collection is worth your attention and investment. That’s why it’s a good idea to spend some time exploring different NFT collections to find something that suits your taste.
If you have any questions or ideas, please feel free to contact our NFT development team.