NFTs are complex investments due to the sheer number of collections. Continue reading to learn how you can make money with NFTs.
This article could not have come at a better time. The crypto market is experiencing a downturn. Some might say that it's like a dumpster fire. What about NFTs? NFTs, as an alternative asset category, are currently in the middle of a bull market.
The valuations of blue-chip companies have increased dramatically.
We're here to help you make money with NFTs. This article will discuss the ethical and legal ways. There are no scams. No rug pulling. Nada. Chief!
Let's now look at how NFTs can help us make money.
NFTs are better than crypto.
"Are NFTs and Crypto the Same Thing?" No. In fact, crypto is fungible and NFTs not. They can be considered as opposites. They are both built on blockchain technology, but that's the end of their similarities.
NFTs cannot be compared because they are non-fungible tokens. You can also consider NFTs proof of ownership over digital assets. NFTs cannot be traded with each other, even if they have equal value. One NFT from Degen Ape Academy may not be equal to one NFT from the DeFi Pirates FFT collection.
This is in contrast to cryptocurrencies and physical money, which are not fungible. They can be traded and have equal value. One Bitcoin is, for example, always equal to one bitcoin, so they can be traded and are interchangeable.
We've got this out of the system. Let's get to the point: Why should you invest in NFTs when crypto can be your investment? These markets aren't correlated?
Many papers on the topic have been published in the short time that NFTs and cryptocurrencies have coexisted. It turns out that there is very little overlap between the two asset classes. NFTs appear to be a distinct asset class when compared to crypto.
They also have a negative correlation with cryptocurrencies. The value of NFTs rises when the wider crypto market falls. There are many reasons why this can happen.
NFT trading is more affordable when crypto markets are low. This is because the blockchain fee is lower in times of downturn. NFTs can also be used to store value in a similar way as traditional works of arts, which has had a good track record in terms of value retention.
While investing in NFTs is a good way to hedge against the wider crypto market, there are tradeoffs. An example is that investing in NFTs can be more difficult than investing in Bitcoin.
You may have different mileage depending on which NFT you purchase. However, in general you are buying access to a group of holders when you buy an NFT. This can be beneficial depending on your needs.
It is possible to network with people from all walks and discuss your common passions. NFT projects that are time-consuming to track and manage can be more difficult. You will need to keep in touch with the NFT community and follow the floor price of the project. Also, you'll need the ability to track price movements in the wider crypto market.
You will need to invest more money and time upfront if you are buying a crypto gaming NFT. You'll need to spend hours playing the game in order to get your ROI back.
Investing in a cryptocurrency for HODLing is much easier.
Although it may be more difficult to invest in NFTs, it can still prove lucrative. This is because so many brands are involved. These include well-known sports brands such as Overtime's BracketX, NBA Top Shot, and Johnny Depp. Celebrities also support projects like Alejandro Salomon’s Rude Golems.
NFTs are changing multiple industries simultaneously. NFTs have been gaining immense popularity with singers, rappers, and singing artists. Musicians make very little from their work, and record labels take most of it. If they're lucky, artists can get 12% in royalties.
The game has been changed by NFTs. Take a look at Steve Aoki who claims that he has made more money this year from NFTs than he made from his 10 years of music making. You will receive royalty payments for every sale of your digital token.
The best part? As the artist, you have the power to decide how much you make per sale. NFT projects are also available for writers. Neil Strauss, a New York Times bestseller, created the first decentralized book to be exclusively stored on the blockchain. It is accessible to anyone, but you must purchase one of Neil's NFTs to own it.
How to make money with NFTs
NFTs can be used in many ways, and the possibilities are limitless. However, it is possible to make money with them.
There are three main ways to make money from these virtual assets.
Let's take a closer look at each one.
One of the most easy ways to make money is through trading NFTs. It doesn't take much to understand the blockchain technology that they use. You don't even have to be familiar with art theory or any other fancy mambo jambo.
You will need to be able to understand the space and the narrative forces that drive it in order to become a successful NFT trader.
This is a great place to begin, but you have to start somewhere. Here's how to trade NFTs.
- Step 1 - Buy Crypto.
NFTs are not the same as stocks. You can't simply input your credit card debits or deposit funds into NFT marketplaces. (Wen lord!)
To trade NFTs, you will need funds to fund a digital wallet. If you are comfortable buying crypto on an exchange, Bitcoinbase and Binance are the best options.
- Step 2 - Choose the right network.
Ethereum is still a popular choice, but it comes with high transaction fees. Solana is a more economical option and can settle transactions quickly. Ofcourse there are other chains like EGLD, BSC that you can choose from.
- Step 3 - Get a digital wallet
Once you have crypto, it is time to get a crypto wallet in order to be a qualified NFT trader. Here's where things get a little crazy. Sending crypto from one wallet to the other requires extra caution. This isn’t your usual transaction. If you make a mistake, you can call your bank and get the charge reversed. Try calling Blockchain Support!
There's a good chance that you will lose your crypto if you make a mistake in a cryptocurrency transaction.
- Step 4 - Choose a marketplace to connect your wallet
There are many NFT marketplaces to choose from. Many more are being launched every day. Just connect your wallet with the marketplace that you wish to trade NFTs on and you are good to go.
- Step 5: Purchase an NFT.
To get started, we'll need to identify the "right" collection. It all depends on what your goals are. Do you want to make quick profits by flipping NFTs for profit? Are you here to win the long-term game?
Once you have the answer, you can start to search different collections. It is helpful to consider the type of NFT. Are you looking to flip real property? Art? Trading cards? Are you looking for crypto gaming collectibles. Answer those questions and buy the NFT you wish to purchase.
- Step 6 - Start selling your art NFTs.
Once you have your NFT, it is time to trade. To do this, you will need to list your NFT in a secondary market. List it for a price higher than what you bought it for or just wait for the market to raise the price of your NFT and then take your profits.
NFT Staking can be another way to make money with NFTs. How do you stake your NFT?
It simply means that your NFT must be "locked" into a smart contract in order to generate yield. The higher the reward, the longer the lock-in period. Projects allow you to stake for up to one year, three months or even a whole year.
However, staking your NFT can be more complicated than trading. For example, not all digital artworks can be staked. NFT stakers identify NFT collections that allow staking.
Before you embark on your search for the next NFT staking job, remember that it is a significant time commitment. If you are a true believer, it is important that you are willing to lock your NFT in place for a long time. Do your research before you stake your NFTs.
This section is for those who think they are the next Van Gogh. Many of us are interested in making money from NFTs, and learning more about the space. Making an actual NFT is more instructive than any article.
Your industry will determine how easy it is to create an NFT. There are many options and considerations when creating an NFT, such as if you're a digital musician, writer, or artist.
You don't have to be overwhelmed by all of the options. It is not as complicated as it sounds, and you can make an NFT in no time.
Although making money with digital assets such as crypto and NFTs may seem like a new venture, it seems like we are in this for the long-term. People have repeatedly shown us that "the right NFT" can make a big difference in their lives, even during the brief period of NFT dominance this year. Literally.
While not everyone can make it big, making a profit from digital assets can be very lucrative. It's easy to follow the space as the NFT traders who spend hours on crypto Twitter only to miss incredible mints such as the one for Famous Fox Federation. (Argh no!)
It happens to everyone. Set your alarm to go for the sale if you find a collection that you like. Whitelist your collection.
Although it is not easy to be on a highly sought-after list, it is worth the effort!
You never know what the future holds. You might find the mint that will change your life.