NFTs- what are they & should you invest

Welcome back, Traders!


Today we are going to be talking about NFTs- the latest blockchain hype investment and something that divides opinion amongst people in every walk of life- if you’ve heard of them, you will feel a certain type of way about them, let’s get into it

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What is an NFT

An NFT (non-fungible token) is a digital asset that is identified through its metadata. Due to the way they are designed, NFTs are unique and cannot be replaced, altered, or changed in any way. Once they have been created, they will be permanently on the blockchain, with everyone able to see the data, more about this below.


The term fungible means that another identical item can replace an item or good with the same value. An example of this would be currency, a £20 note is worth just the same as any £20 note, someone then asks you to trade notes, you won’t gain any value but you also wouldn’t lose any value either. This is NOT the case with NFTs. If you purchase an NFT, you will be the only person in the entire world to hold that asset and you have the proof that you own it. This attribute lends itself extremely well to various industries, creative ones especially.

Currently NFTs are mostly used to verify ownership of digital goods and because of this, industry leading brands have all started to jump into the market, examples being Adidas & Nike selling virtual trainers and clothing, some of the biggest artists in the world are offering the digital versions of their art piece along with the sale of the physical piece- validating ownership and authenticating it.


Where to buy NFTs

Most NFTs are on the Ethereum and Solana blockchains respectively- Ethereum and Solana let users build apps that can store personal data and rules for specific functions. These are smart contracts, which are digital contracts stored on a blockchain that are automatically executed when certain conditions are met.


Below are the 3 biggest marketplaces to purchase NFTs and some examples of the type of NFTs on offer at each of them


Crypto.com’s NFT marketplace allows users to buy and sell digital collectibles from brands, celebrities and artists like Snoop Dogg, Aston Martin and UFC- this is the biggest celebrity endorsed place to buy NFTs

Crypto.com | The Best Place to Buy, Sell, and Pay with Cryptocurrency

OpenSea goes by the tagline “the first and largest NFT marketplace.” The site is filterable by price and rarity, you can find everything from virtual real estate to sound loops from The Weeknd. digital art, music, games, domain names, virtual worlds, sports, collectibles- all available on OpenSea making it the marketplace with the most variety.

OpenSea, the largest NFT marketplace

Rarible is an NFT marketplace where users can mint, buy and sell digital collectibles ranging from GIFs to animated videos commemorating sports milestones such as boxer Floyd Mayweather Jr.’s undefeated 50-0 record. The layout is like Spotify, featuring top sellers, hot collections, and live auctions. All on offer at Rarible is Digital art, photography, music, games, metaverse, memes. A token known as RARI allows the most active buyers and sellers to vote for platform upgrades and participate in site decisions- this makes it the most user interactive and popular amongst NFT collectors and resellers.

Rarible – Create, sell or collect digital items secured with #blockchain


Should you invest?

The NFT market is volatile, which is seen by many as a good thing as you can have a big swing in the positive direction and end up making A LOT of money- the biggest NFT sale to date being in 2021, 'The Merge' for an eyewatering $91.8m. Now obviously the idea of getting rich quick and flipping NFTs for huge profits is the dream but, in most cases, unless you have researched a collection, get in on a presale opportunity or in some cases- example Adidas in to the metaverse- win a raffle, you will have to have a bit of luck to make profits! we aren’t saying you can’t make money, but being cautious about investments and thorough research into what you are purchasing is a must!


The market is only going to get bigger, so looking at NFTs as a long-term investment and not short-term gains, especially as the Metaverse (see next week’s blog!) is going to be expanded on in huge way over the next few years and huge international companies now jumping on the NFT bandwagon- NFTs and the technologies attached to them are not going away.


Bottom line, if you research a project or like a project and the ethos behind it- go for it, but we advise caution- like all other things that involve money changing hands (or bank accounts!) there are scammers, hoaxes and nasty people in the dark corners of the internet, and they would love nothing more than your hard-earned money- Don’t give it to them!

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Come back next week, where we will investigate the metaverse in more detail, its relationship with NFTs and the future of digital marketplaces and what it means for physical shops and companies.


Thanks for reading, your friendly Trading Top 10 team!