The crypto space is always full of rising trends and narratives, and nowadays, the NFT narrative is one of the most popular… we dare to say even more than DeFi. But why has NFT become so popular? What’s inviting so many people to participate in this economy?
We will analyze the reasons that have taken millions of people to prefer NFT over the usual choice of just going to buy bitcoin with credit card. Because we are sure that NFT is here to stay.
Contents
What makes NFT so popular and valuable?
NFTs are popular because they solve a very specific problem: they create scarcity and authenticity for different objects. From art to videos and even music, an NFT will always be 100% unique and will contain accurate and incorruptible information about the provenance, ownership and authorship. It solves piracy right on the act.
The problem with digital art and collectibles is that it’s easy as hell to replicate them, but with an NFT, you can protect your work. Think of yourself as an artist, wouldn’t it be awesome to protect your work like that? This is what has taken many digital artists to use NFTs and sell them on marketplaces.
NFTs can be used to protect any type of digital product. Be it a photo, clip, digital art, and even a text, you can do all sort of things with it. Since it solves such a direct problem, we are sure that NFTs are here to stay, but the industry still needs to mature.
However, we all know that most people will not look into the fundamentals when making a decision. There’s something even stronger that’s feeding the popularity of NFTs, and we will talk about it in a second.
What’s driving the NFT growth and popularity?
The main factors that are driving the growth and popularity of NFTs are that big players like NBA, UFC and famous anime series are getting into it, and the possibility to make a lot of money.
Most people who get into NFTs are doing it for the money. Similar to what people do when they see pumping crypto prices, they just try to pick the one that has probabilities of raising their profits. They don’t look into the fundamentals, they only check the green and the profit potential.
The same happens to NFTs, especially after they see the gigantic profit potential. For example, they probably read about Beeple’s story and how he made over $69M by selling a single piece of art in NFT format.
The examples don’t stop there, let’s check NBA Topshot. As of February 2021, the platform reported that the users spent over $230M trading the video highlights. These cold facts usually don’t represent the sentiment, but stories like these surely do… making 4000% ROI is always a motivating story for an eager audience.
This is the perfect storm for getting more people involved because they all are looking to get some of that cash themselves. Unfortunately, it’s sure to say that most will end up losing money… why? Let’s explore the dark side of NFT’s popularity.
The Dark Side of NFTs
NFTs can be a huge source of profit, don’t get us wrong, but most people will do it wrong. And this happens when people do the following:
- Shop overpriced NFTs from marketplaces with the aim of reselling them
- Buy NFTs from other collectors with the intention of reselling them.
Reselling usually involves having a large network, the right contacts and being lucky. If you’re planning to get it as a reseller, then good luck to you.
The best route to do this is to simply become a creator or buy the cheap NFT packs from the NBA topshot and similar platforms. Even popular anime series and videogames have launched their own NFTs, an example would be Street Fighter. The packs sold for about $25 and the potential for ROI is quite good.
So if you want to make the most out of this trend, then this is how you can do it. Alternatively, you could also invest in the coins from low-cap NFT marketplaces and solutions such as PHANTASMA. With a low market cap and a working product, it’s sure to produce a good ROI during this bullish run.
Final Words
As you can see, the world of NFTs is growing day by day, but there are some hidden dangers you need to be aware of. Let us know what you think about NFTs in the comments and if you’ve bought one yourself.
As always, take our tips in consideration because they will help you to protect your capital and boost your profits in the long run, especially during this current bullish scenario that’s more likely to make you money.