Although we will present some pieces of advice here, there is no guarantee that by following these ideas – or ideas listed elsewhere – that your NFT purchase will be worthwhile to you.
Here’s a few suggestions to keep in mind when selecting an NFT to purchase:
- Do I like the NFT?
- What is the reputation of the creator?
- Is there a community for the NFT?
- Will this NFT be an investment?
- Is there a roadmap for the NFT?
- Can I afford the NFT?
Do I like the NFT?
Do you like the look of the NFT? What it represents? The art style? Having an interest in the NFT helps you to form a strong connection.
If you’re a sports fan, look into officially-licensed sports NFTs. If you’re an art aficionado, find an NFT artist with a style that you enjoy.
What is the reputation of the creator?
Do your own research on the creator of the NFT. Gather trusted information from original sources. This will help you to avoid the most common NFT scams.
Quality NFT collections will be transparent, with the team sharing their real information, rather than pseudonyms.
Many celebrities have launched NFT projects, only to quickly abandon them. Celebrity involvement is no guarantee of the success or longevity of an NFT collection.
Do your research, ask questions, and get the information you need. If red flags appear, steer clear.
Is there a community for the NFT?
Are people excited about the project? If so, how involved are they?
Most NFT collections will have a Discord, where you can view activity and discussions first hand. Be wary of huge numbers for a brand-new project. Social media numbers and chat activity can be easily botted, so look out for authentic followers, and ask them questions about the NFT collection if possible.
Will this NFT be an investment?
There’s two main reasons you will buy an NFT: for fun, or as an investment.
If you’re buying an NFT for fun, it is generally because you would like to support the artist and their work. Research the artist to verify that the art they are selling is their own.
If you’re buying an NFT as an investment, consider if you are buying as a short-term or long-term investment:
- Short-term investment: look for NFTs with high trading activity, or that are teasing upcoming news. This is very risky, and profits are never guaranteed. We would only suggest this options to experienced NFT collectors.
- Long-term investment: look for NFTs with trusted teams, with a clear roadmap and track-record of delivery. This option is more beginner-friendly, though we strongly suggest doing ample research before purchasing any NFT for investment purposes.
Many NFT marketplaces, tools and services can provide you with data analytics, community information and general trends. Always do your own research before buying any NFT.
Is there a roadmap for the NFT?
A roadmap gives you an idea of the future plans of an NFT collection.
Typically, it is less risky to buy an NFT from a solid community with a proven track-record.
If the collection is pre-mint, play attention to their roadmap and future promises. Be mindful that before mint is where an NFT will hit the peak of its hype, and that prices can swing wildly after a mint.
Can I afford the NFT?
NFTs can be exciting – but they’re also high-risk, with no protection for holders if something goes wrong.
NFT prices are largely dictated by community hype and market sentiment – both of which can change very quickly. Do not buy an NFT unless you’re prepared to lose all of the money that you spend.