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This year, there has been a substantial increase in interest in non-fungible tokens. As a result, a substantial number of new NFTs have emerged. Experts discussed how to operate effectively with a new industry while still making a profit.
What are the NTF’s
Non-fungible tokens are one of the crypto investment trends for 2021. (NFTs). In recent months, this asset class has witnessed many waves of popularity. In the spring, there was n increase of investment interest in NFTs.Token sales hit a new high of $2.5 billion in the first half of the year, up 26 times over the previous year. The industry’s popularity waned at the start of the summer, but by August, NFT investments were resurrected: the monthly trading volume on the largest NFT platform, OpenSea, had hit $3.4 billion.
With increased investor interest, the quantity of NFTs increased as well, with numerous new tokens appearing on the trading floors. RBC-Crypto specialists discussed whether it is possible to profit from the resale of obscure NFTs and if it is worthwhile to invest in this sector.
How does NFT’s work?
According to Nikita Soshnikov, director of the Alfacash: cryptocurrency exchange business, the NFT sphere is the most challenging for investments due to the non-obviousness of asset intrinsic value. Young and inexperienced investors, he advised, should avoid betting on this industry because even pros cannot always work smoothly with NFTs.
When it comes to choosing NFT tokens for speculative or long-term investments, the expert advises relying on the asset issuer’s reputation. For example, if it is a well-known basketball or football team, Soshnikov added, there will be greater opportunities for growth or, at the very least, the avoidance of a sudden decline.
Because non-fungible token technology is already widely used in art, Elena Buydalina, product manager at Erachain, believes that in order to uncover profitable investments, it is vital to use sites where quality works are displayed. In her opinion, you can search for works of art on the Foundation, MakersPlace, Snark.art marketplaces. Urban Files and others.
Those interested in trading NFT in the realm of art could look for artists participating in the Art Life festival on social media and subscribe to their updates to be the first to hear about the release of new works, according to Buydalina.
The author’s name is particularly crucial when reselling NFT tokens, according to Buidalina. According to her, even on the secondary market, an NFT by a well-known artist is more likely to be purchased quickly than art by a random author, which can take months to sell.
Working with NFT in the sphere of art is similar to working with regular art, according to Vladimir Smetanin, CEO of the Swiss financial firm Newcent. In his opinion, the greatest technique for non-professional collectors in this market is to acquire what they like. The most important thing, according to Smetanin, is that the fee for this work be profitable. In this instance, he believes that purchasing NFTs is a solid investment.
The future NFT Trading industry
Soshnikov adds that the NFT business is still in its infancy, and that a substantial number of “junk” initiatives is to be expected at this stage. According to the expert, such ventures will eventually exit the market on their own, resulting in the sector being more solid and predictable.
The real NFT boom is yet to comepredicted Soshnikov.