I’m sure that you must all know about the definitions of NFT out there on what a Non-fungible token is; basically, NFTs are simply “tokens” that can verify their owners.
Technically speaking, you can screenshot an NFT and save it to your gallery; however, that image “copy” of NFT will not give you the ownership of the actual artwork, nor the exclusive privilege that comes with it.
Legendary Monkey aka Batmonkey — from Monkeys Supremacy
Let’s give an example:
Nate — a guy who likes the monkey, and he had a screenshot of Monkeys Supremacy NFT, in this case, it’s Batmonkey, but unfortunately, that image doesn’t give him the ownership — which means he can not breed, stake, flip, or profit from these screenshots (unless he’s a scammer).
How Can You Make Money From NFTs ?
There are three main ways to make a profit from NFTs. You can generate income by selling NFTs as:
- A flipper: you buy NFTs and resell them at a higher price, or
- A creator: you create artworks and sell them as NFTs.
- An investor: you use the NFTs as a way to invest in the project or staking these NFTs to get profits
So, before you begin your journey in the world of NFT, you need to decide this — are you a flipper, creator, an investor, or, all of them?
How to spot good NFT projects
Similar to every other project in the blockchain world, there are some patterns that can help you find the potential project to jump in, but keep in mind that there is no quick and easy way to spot a good NFT project instantly because scammers are everywhere in the NFT world, unfortunately.
- Real Followers/ Community: a good project will have many followers (of course) and a large number of reactions from followers — this is a clear sign of having natural & organic followers. There are projects out there that have bought followers, which means they have many followers, but their social media interactions are not that high; you will typically see this phenomenon on Twitter. Another way is to join their Tele/Discord group, you can see how users are discussing things there, and how actively the admin is.
- Real Transactions. The perception of value changes when someone buys a resale NFT at a much higher price. However, this transaction can be faked because the seller can easily create another digital wallet to buy their own NFT to raise the floor price. Thankfully, you can inspect all transaction details, including the purchase history of a digital wallet. To check if the transaction is real, you can always check whether the same wallet has been used to buy the same NFT collection or whether the digital wallet has only one transaction.
- Clear Roadmap: like other blockchain projects, a project’s roadmap is one of the most straightforward courses you can take to see if an NFT project is any good, you’ll see what plans they have in store for the future & how they would stand out in the tight competitive market.
- Trustful founders: as an investor, one of your top priorities is to avoid any possible scams that could occur, and knowing that the founders are credible ensures that you and your money are in good hands. A credible team should be traceable with visible track records, or past achievements to prove their worth. If the developers are unknown, a red flag is detected.
About Elrond NFT Ecosystem
You can look at the last update on Jul 22, 2022, from Elrond about NFT projects built on their blockchain. In general, we see that the map is expanding quickly with every necessary piece:
- Marketplaces: where you can buy & sell NFT conveniently, the UI is optimized for users to have their best flow to get
- Gaming: these projects are basically a game with their own gameplay and use NFT as an additional way to interact with users (usually via items in-game like skins, potions, weapons,…)
- Tools: projects which provide more insight to users, as well as services like wallet tracking, NFT collections tracking, news about new mints, and further drops.
- Projects: NFT collections with unique designs & use cases.
Final Thought
The NFT market is one of the most potential and energetic fields that help expand more and more creativity and money flow. On Elrond, we saw a solid development of the NFT projects there, you can take a look at the article from Mr. Dan Voicu to see more details on how things are being built.
If you want to know more about the DeFi world, let’s take a look at our DeFi 101 Series.
We hope that our article can help you somehow.
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