There is a reason that one NFT sold for $4 million and that over $1.5 million of NFTs were purchased within a month of 2021. No, they are not a fad for the rich; NFTs are a real investment.
If you are wondering if you should invest in NFTs (maybe not the million-dollar kind) you should know what they are and their potential value before you make your decision.
Read on to discover 5 reasons why an NFT purchase is a good one.
1. One of a Kind
The first thing you should understand is how do NFTs work. They are a non-fungible token, which means they are a unique asset like no other, being non-fungible. The token (unique code of data) represents the asset (digital art or other forms of NFTs) that exists on the blockchain.
This means that no one else can own the same token that you own, making it a rare collector’s piece.
2. Appreciation
Since NFT investments exist on a living blockchain that adjusts to the cryptocurrency market it is guaranteed to appreciate over time. And this determination of value has nothing to do with an appraisal, rather it depends on the community of NFT enthusiasts and their creators.
3. Ownership
Buying an NFT like the ones linked here does not just make you an owner, they also put you in the club of NFT holders. For example, artists sometimes hold events for their investors, or you may need your NFT to get access to exclusive chats or special NFT shops. Essentially, you become a shareholder with your NFT securely listing you as the sole owner.
4. Growing Popularity
The trend of investing in NFTs is still in its beginning stages, however, it is slowly becoming more popular. Getting your foot in the door to make early purchases before it becomes mainstream can make you a significant collector in the community.
You can even resell your NFT collections or make variations of them on the blockchain to sell to new enthusiasts. So, you can not only be a collector but a creator of NFTs.
5. Investing in Future Technology
The artworld is not the only place where NFT technology is useful. Different types of NFTs expand across all industries because the technology is so versatile.
Therefore, when you buy an NFT you are also investing in opportunities like using your asset to get a mortgage or pay a loan. It also just might be the new virtual interaction method, from commercial sales to digital identity using smart contracts to ensure proof of authenticity and ownership.
Invest in NFTs for the Long-run
When you invest in NFTs, you are making more than a one-time purchase that you set and forget. You are becoming part of an innovative technology that only has the potential to grow. This is the reason that bidding wars occur over some of the most popular art collections, but this is just the bringing.
Check out our Technology section for more up-and-coming cryptocurrency innovations.