Lecture 6.0.0. Profitability of an NFT
Indeed, the rise of NFTs is already birthing the third wave of millionaires in the Crypto Market. However, to acquire wealth from an NFT, the NFT has to be profitable.
The profitability of an NFT depends on these three factors:
1. Popularity
The NFT or the creator of your NFT has to be popular or famous and have a worldwide brand that a number of people know about.
You can understand why popular soccer players like Lionel Messi made millions from their NFT sale.
2. Scarcity
The NFT has to be rare and limited in quantity. According to the economic law of demand and supply, the scarcer an item is, the higher the price of the item. Thus, the rarer an NFT, the higher its market price, especially if it is an NFT that is also popular.
3. Use Case
The use cases of NFTs have been discussed above. Note that any NFT that has a well-defined use case will undoubtedly become profitable. The present euphoria associated with NFTs may die off as NFTs with more specific use cases appear more and more in the Crypto Market.
Therefore, don’t just buy any NFT and hope it will produce profits for you. Always check these three criteria before you invest in any NFT.