What to Consider Before Purchasing Your First Set of NFTS
Currently, NFTs have become quite popular; their continued growth in desirability and value seems to have no limit. However, when it comes to doing your research, there are various things you need to take into consideration before taking a risk.
So, if it’s your first time and you are looking to spend a decent amount of cash on an NFT, it’s quite crucial to consider certain factors in your research.
So, what exactly should you look for before making your first NFT purchase?
NFT Market Volume and Liquidity
It is important to remember that NFTs have equal liquidity with crypto coins.
It is difficult to liquidate NFT easily into traditional currency, unlike cryptocurrency. Thus, it might be challenging for those investing in NFTs to gain profit. Fortunately, you can fractionize your NFTs to raise their liquidity rates; this involves splitting your NFT into tiny parts.
Apart from liquidity, it’s crucial to consider the market volume of the NFT industry. The NFT market volume is around $10 billion, but the fall or rise of this number mostly depends on the type of NFTs being bought frequently.
You must be aware that the NFTs market is quite young. A few years ago, not so many individuals were talking about NFTs. You could hardly comprehend that these digital artworks could be selling for millions in a few years. Like most organizations that seem to grow overnight, success can be short-lived.
Seller Verification
Like Instagram or Twitter accounts, legit sellers on various platforms, including OpenSea, have a blue verification tick at the end of their account name to confirm that they are not an impersonator account. Thus, if you want to purchase from a popular seller such as Cool Cats NFT or World of Women, ensure that the account has a verification tick.
Unfortunately, the verification tick cannot always be used to prove the seller’s legitimacy. Most legitimate NFT vendors are yet to acquire their verification tick on various platforms. Consider checking with the NFT properties to confirm if you want to purchase from an unverified account.
Similarly, you can research the seller’s social media accounts to determine if they have a verification tick or a decent follower; this acts as a confirmation for legitimacy.
Equally, you can visit their sales pages and check their statistics to see if it is a newly opened account or it’s a well-established one selling your preferred NFTs.
The Unique Properties of the NFT
Mainly NFTs usually come in the form of collections.
Consider PEACEFUL GROUPIES, MekaVerse, or Bored Ape Yacht Club. They are NFT collections comprising individual avatar NFT networks consisting of different properties. In some cases, more properties translate into higher value, while sometimes it doesn’t. In some instances, the simpler avatars are more valuable, including the Bored Ape NFT.
If you aim to increase your chance of purchasing an NFT with a high-value trajectory, consider checking the rarity of the properties your preferred NFT has.
Ensure you choose the NFT with the least percentage of commonness in the collection. You can check the percentage level at the properties section on the NFT’s page. Checking the properties will go a long way in confirming the legitimacy of NFT since it is not possible to replicate properties.