The NFT industry is hot and only heating up from here. With values skyrocketing, sports teams and major corporations getting involved, and millions being made, even by children, demand for non-fungible tokens is riding on highs with no signs of slowing.
So, you want to get in on the newest craze in technology, do you?
With so many projects out there, it’s often difficult for newcomers to decide how to go about choosing the best to get in on. After all, there have been stories of less-than-savory project developers selling millions in NFTs and dropping off the face of the earth, delivering nothing but empty promises. So, how do you go about choosing the best projects to stand behind?
How to Pick the Best NFT Projects to Back
If you’ve decided that you’re ready to jump into the non-fungible token space, congratulations, you’re embarking on an amazing journey. However, you don’t want to jump on the first project you come across. When choosing a project to back, you’ll want to dive into the following:
The most important part of the NFT industry is community. The entire blockchain is essentially a system of trust that’s owned by the community as a whole. So, if someone’s making big waves in space, chances are that there’s a massive community behind them.
Before diving into any project, check out the project’s Twitter, Discord, and Instagram profiles to see a few things:
- Activity. First and foremost, if the project is doing anything, it will likely be heavily active on Twitter, Instagram, and Discord. These outlets are a great way for community developers to reach out and communicate with their audience. The most active projects are consistently posting daily updates, news, and events associated with what they’re working to accomplish in the space.
- Following. Does the project have any serious players in the space following them? The NFT space is young, but there are already leaders beginning to emerge. Check to see if any of those leaders have the project on their radar.
- Engagement. Did the project just build a Twitter page for community members to chat or are the founders of the community engaged in the discussion? Those that are most engaged likely have the most to offer.
- Leadership. Within the community, you’ll be able to see who the founders of the project are, whether anonymous or doxxed (we’ll get to that in a bit). Regardless of whether they’re an anonymous player or fully exposed, their leadership shouldn’t be in question. For example, the founders of Meta Masters Media include PrepsToThePros and ArtSoFly, two OG Whales who help build credibility for the entire project.
Are the Founders Doxxed?
Doxxed is a colloquial way of saying exposed. You see, the NFT space, like much of the blockchain industry as a whole, gives the founders the ability to be anonymous, using high end tokens as their personalities in the industry. There’s nothing wrong with that.
However, when founders doxx themselves, or fully expose themselves by publishing their names and a headshot, it adds credibility. After all, with their real information out there, it would be difficult for them to launch a collection and pull the rug out from underneath collectors.
However, it’s important to remember that projects with doxxed founders aren’t the only ones you can trust. If you find a project you’re interested in with anonymous founders, look into their pseudonyms to see what clout they have in the industry. Even anonymous players are often big players that stand to lose quite a bit if they lead collectors astray.
Next, take a look at the website for the project. Does it look like a sloppily made site that was thrown together overnight or is it something that a team likely worked on for weeks. Is it a clean layout? Do the graphics look like the founders took the time to make it what they wanted it to be? Is there plenty of information that’s updated regularly? If so, you’re likely on the right track.
NFTs are worth far more than the art they represent. Many of them come with utility. For example, Glenfiddich is launching a collection of super rare NFTs that can be exchanged for bottles of super rare scotch. Not to mention, there are NFTs that act as characters in games, projects that own land in the metaverse, giving you the ability to interact with your art, even NFTs that make it easier to communicate important data to your doctor.
Tokens that come with utility come with an immediate form of value, whether it’s the ability to play a game to earn money, join an exclusive event, or trade your token for a high quality liquor or other product. Some even give you the intellectual property rights to the art associated with the token. Check out how the token can be used before diving in.
If No Utility Exists Consider the following
Some tokens have no utility at all. Instead, they are designed specifically as digital works of art. If that’s the type of NFT you’re after, you want to consider a few things. First and foremost, is the art actually appealing? Moreover, was it developed by hand, using artificial intelligence, or in another way?
Also, consider how rare the art is and whether or not you own the intellectual property rights to the art when you sell it. The more rare the token is, the more valuable it stands to be in the long run, with one-offs being the most prized. Moreover, with intellectual property, you’re able to turn the art into a brand that has the potential to make you money in the long run.
Don’t be afraid to reach out to the founders of any project and ask questions. As mentioned above, the community is the most important aspect of the industry as a whole. If the founder is too stuck up to answer your questions, don’t be afraid to tell him to kick rocks and look elsewhere for opportunities. The NFT community responds best to projects that are founded by members of the community that are happy to answer any questions that may be posed.
Look for What’s Been Done
Anybody can shoot you a line, hope, and a dream. Before diving into an NFT project, take the time to look into the history of the project to see what has been done to date. For example, if a project plans on launching a new game, consider what stage of game development they’re in.
Have they hired a writer? What about a graphics developer? Have they created a teaser for the community? Is the game live? The further along in the process the project is, the more valuable it stands to be in the long run.
The Bottom Line
The bottom line here is simple. There’s no real silver bullet that will tell you if you’re looking at the next million-dollar NFT. That’s not what the industry’s about. Instead of focusing on these digital works as an investment, consider them collectibles and collect them for the love of doing so. Consider the uses of these tokens that are most valuable to you, the art you enjoy most, and the communities you enjoy being part of. Chances are, there are plenty of collectors that feel the same. So, by following what feels right to you, success in the NFT space will likely come!