With 2022 coming to an end, we have seen another year of NFTs slowly establishing themselves as viable digital assets and investment options. There is still some way to go in raising awareness and educating people on how the entire NFT ecosystem works, however with the number of daily NFT sales gradually increasing over the course of this year, we can be optimistic about the future.
For many of you, who have been through the NFT hype of 2021 and have held on to their cryptowallets, the question remains: should I be buying NFT Art?
Well, let me give you a quick rundown on all things NFTs to help you answer that question.
Non-Fungible Token?
For those who are uninitiated, NFTs directly address the concerns of scarcity and authenticity that buyers and collectors of physical art have when it comes to acquiring digital art. NFTs are produced with the help of blockchain technology, which just like the Bitcoin, provides a secure record of transactions. This helps in maintaining an unquestionable proof of ownership and provenance that ensures that original artworks and their owners are always identifiable via the blockchain. These NFTs can be taken as virtual signatures which helps in securing the value of the digital art regardless of how many times it is reproduced.
It has not been long since NFT entered the lexicon of online traders, however in its very short span of entering the digital realm, it has caused quite the commotion in the art market. With collectors and speculators having bought over 43 million NFTs since 2017, NFTs have finally provided a trustworthy solution for apprehensive buyers who have always been interested in purchasing digital art.
NFT is not only a shining new opportunity for art collectors but it is also a great one for digital artists like me. For example, NFT allows for artists to receive royalties every time their artwork is traded or sold which is incredible as this allows them to keep reaping the financial benefits of their work perpetually. Plus, with NFT rapidly becoming the gold standard of authenticating and validating digital art, the market for digital art investment is quickly expanding leading to higher demand for our work.
What does it mean to invest in NFTs?
If you are just looking to diversify your investment portfolio and eyeing NFTs as your next addition, here are a couple of things to keep in mind to maximise on your potential earnings:
- The importance of research and learning as much about NFTs before you put your money down cannot emphasised enough. You need to get over the steep learning curve of investing in NFTs and strive to stay updated on the NFT trends before you even open up your actual wallet to create a crypto one. Understand the kind of NFTs that are in demand and could be in demand in the near future, then start investing accordingly.
- Invest according to your risk appetite. If you are risk averse, try not to bite more than you can chew because the regret of losing money over something that you were not completely sold on initially will only put you off the whole thing. So, invest with what you are comfortable with: I suggest start small and build up your investment from then on.
- If you are looking for the right platform to get your start on as an NFT investor, I would suggest starting with OpenSea which is one of the most popular NFT platforms that has a very user-friendly interface and numerous language options. It is the perfect place to start understanding how NFTs are traded and how the market works. Also, YouTube is an incredible resource for all the info that you could possibly need to understand important concepts like NFT staking, regardless of whatever language you are proficient in.
- As I mentioned, NFTs have a steep learning curve. So, if your resources allow, it will be a wise move to hire the help of an investment consultant who specialize in NFTs that can support you in navigating the intricacies of digital investments. Go for a consultant that has a track record of effective management of NFT investments and preferably comes with referrals.
Where should I start with buying NFTs?
As someone who has minted art NFTs of their own, the digital marketplace was quite intimidating initially. This was mainly due to the learning curve that everybody experiences when getting into cryptocurrencies and investing in digital art online. However, as I discovered various platforms that dealt with the buying and selling of NFTs such as OpenSea and Foundation, the user-friendliness of their interface and their online community helped incredibly in bridging my knowledge gaps. These platforms are constantly being refined and updated to be more accessible who are looking to invest in art NFTs.
I would highly recommend visiting my profiles on Foundation and OpenSea to get an understanding of what these platforms offer and how easier it can be to start exploring the digital art realm and acquiring pieces that connect with you and also provide you with an investment opportunity.
Please keep in mind to read and watch as much content as you can about NFTs. You do not want to get into NFTs on a whim. This will only result in a loss, so understand how is an NFT created/minted, what are the various NFT marketplaces and their pros and cons and all the additional costs associated with creating your own NFTs. Check out some of my previous blogs for these topics as I have covered almost all of them.
Shop my artwork collection here.
Check my digital artwork collection here.