Lecture 5.0.0. How to Invest in NFTs
As discussed in the lessons of Grade 2 in the Primary SOC, three generations of crypto millionaires have emerged in the Crypto Market. The first generation is the Bitcoin millionaires, followed by the DeFi millionaires, and the third wave of millionaires that are being born in the Crypto Market is the NFT Millionaires.
NFT is at its early stage of growth. Meaning, if you position yourself correctly, you can be among this third wave of millionaires that will be born via NFTs.
How do you position yourself and invest profitably in NFTs?
Presently, there are five ways you can invest in NFTs:
(1). Minting NFTs
To mint an NFT is to create or produce it from the blockchain. This is also known as “mining NFTs.” Just as you mine any other cryptocurrency from its blockchain, NFTs are also mined from blockchains.
In fact, some artists have started toying with the idea of launching their own blockchains specifically to mint NFTs. That will require forming a company that will assemble information technology experts to produce a blockchain. It entails good start-up capital.
If you do not have such expertise and capital base, there are a number of blockchain companies that can allow you to mint your NFTs. Popular ones are:
• EdaFace NFT Marketplace
• Binance NFT
• Rarible
• OpenSea
• Mintable
(2). Merchandising NFTs
There are various ways you can merchandise NFTs:
(a). Day Trading
This involves buying and selling NFTs.
(b). Hodling
This is buying an NFT and holding onto it until its price appreciates before selling it at a profit.
(3). Token Acquisition
As mentioned above, some NFTs come with their coins or tokens. You use these cryptos to buy and sell the NFTs.
Thus, you can buy these cryptos and wait for their prices to appreciate. In fact, most people who get involved in NFTs usually do so by buying their cryptos.
Imagine acquiring the tokens of a popular NFT and patiently waiting for their prices to appreciate! You can use such tokens for yield farming or stake them to acquire more.
Popular NFT tokens that are worth acquiring as part of your portfolio include:
• Ecomi
• Chiliz
• Decentraland.
(4). Royalties
In some NFT marketplaces, you have the option to program your NFT to be receiving royalties for all sales made just as you obtain royalties for publishing a book. This can create a lifelong passive income for the owner of the NFTs.
(5). DeFi activities
As their use cases evolve, NFTs will undoubtedly feature in most decentralised financial activities such as lending and yield farming.
In fact, the use of NFT in collateralisation will be a strong feature of DeFi in the future. Some protocols have started to accept NFTs in liquidity pools. There is no doubt that NFTs will play significant roles in the rapidly growing DeFi activities.