I have been really fascinated with NFTs since the first time I became aware of the concept few years back with the launch of Crypto Kitties. When I bought my first pair of kitty NFTs it was just to experiment with this new gaming model and I had no idea then that NFTs can be so financially rewarding or punishing as well.
Since then I tried out several NFT projects and with each one I learnt something new through the pleasant and disastrous experiences that accompanied these experiments.
I want to share through this post which projects turned out really rewarding and which projects turned disastrous and what were the main lessons I learnt so anyone who is starting out new on the NFT journey can learn from my experiences about what to look out for and what to avoid.
Mobox- 1 Year of SteadyPassive Income and going strong
Mobox was one of the first NFT gaming projects on Binance Smart Chain that I invested in. I started right when the project was launched in April 2021 when it was a really new project.
The concept seemed very promising to me and decided to try it out. That time I was not really sure how sustainable it will be and what kind of rewards will be generated.
I wrote the following article in April 2021 focusing on what were the features of this project that I found really exciting- https://sambtc.medium.com/mobox-this-nft-game-is-all-set-to-explode-51122ab802d
It has been over a year since I invested about $5,000 in Mobox to purchase 3 Rare Momos. Since then I have been earning steady passive income through their native MBOX token which can be traded on Pancake swap as well as Binance. When I was new in the project I was earning more than $150 a day as the payout rate was very high and it was being distributed among a small group of investors. As the number of users grew and token payout decreased to a steady rate I started earning around $50-$60 a day which is also not bad. Even after completing a year they are going strong as they regularly keep launching new games.
Overall this project has generated over $20K in passive income for during last year which makes it the most successful project in my portfolio so far.
The main takeaways for me from my experience with Mobox was that if you enter a project at the very early phase then you have highest chances of maximising your gains. You reduce your entry cost as the NFTs are usually very cheap at mint time. Also by entering early you maximise the passive income as early users get higher proportion of payouts.
The other key lesson was that it’s always better to find projects which offer passive income. When you try flipping NFTs it is impossible to find the top price to sell and once you have sold you will need to wait to find the next big project. With passive income you are continuously rewarded for just holding the NFTs.
I would like to clarify one point here that you need to be very careful while selecting your projects as after the successful start of Mobox many other projects tried to copy and replicate its model but the majority failed miserably.
Stacked Toadz- My Biggest Flip till Date
Next I would like to talk about my experience with flipping NFTs. I was really impressed by the flipping strategies posted by NFT veterans on Twitter how through one successful flip they were consistently making millions.
Determined to try my hand I joined a so called Alpha group which soon gave a call for buying Stacked Toadz at 0.15 levels and soon I bought 3 NFTs at a total investment of 0.5 ETH. The very next day this project started to pump exponentially and crossed the 2 ETH mark which made my gains 20X already.
I was not sure if I should sell as this project was offering staking rewards as well but when day after I saw floor price at 3 ETH I just sold one NFT and started booking profit. As soon as I sold my first piece the market started to reverse and by the time I was able to sell the remaining two NFTs I had market was back at 2 ETH level.
After taking out my investment and gas fees I had made a profit of about $18K in 2 days. I could not believe my luck and thought flipping was the best strategy. I soon heard that the project got hacked and the floor price almost touched 0.
This was the luckiest I had ever been with trading NFTs and I refused to believe that this was just a fluke and I had not made any genius move. I soon joined many other Alpha groups and tried to flip other projects. I suffered losses in almost all of them.
I soon realised my folly after losing about 10K of the 18K profit I had made and bought some solid projects to hold for long term with the remaining funds.
My biggest lesson learnt with flipping NFTs was that it was almost the same as gambling. Most of the influencers driving the Alpha channels were basically running pump and dump schemes with the hope of selling their bags before rest of the group gets wiser. I have now completely stopped flipping and only invest in projects that I am long term bullish on.
Pawzees - My Biggest Blunder to Date
I have been in the crypto space for over four years now so through my good and bad experiences I could figure our which were the red flags of an obvious scam and what to look out for in a genuine long term project. No strategy is fool proof and I had been rugged many times earlier whether by a fraudulent coin launch, DeFi project that rugged, Algortihmic stable coin abandoned by founders etc.
As I was always on the lookout for new projects happening I knew I cannot completely avoid scams but I ensured that my risk exposure to them was minimal.
This I think also made me a bit over confident as I was not prepared for what happened with Pawzees.
Pawzees NFT was being shilled strongly by an influencer I had been following for a long time and had made decent profits from his previous recommendations.
Pawzees also had a detailed roadmap and clear mechanism for generating rewards for its holders.
There were some small red flags that in the site they made a lot of huge claims about future plans but there were no details about how they will do it. Also the influencer I followed usually made very detailed analysis but this time he had skimmed over the roadmap details.
I blindly bought 6 NFTs and was horrified when soon the founders abandoned the project.
My only regret with this project is that I further shilled it and know for a fact that a couple of friends took a hit because of the rug pull.
Since then I have been extra cautious not to recommend anyone a project till I have done a detailed due diligence on my part personally.
I think the biggest lesson learnt for me here was that the recommendation by influencers should only serve as a starting point after which you should do your own research and invest your money only after you are personally convinced.
Since then no matter how attractive a project looks if the team behind it is not doxxed or at least semi-doxxed I stay away from it.
It also made me realise that even the biggest NFT influencers make big mistakes however the majority try to brush it aside and don’t let it get public to protect their image.
I would like to close by saying that the biggest risk you can take in crypto is by not diversifying. You can never be 100% sure of the long term sustainability of any project due to several factors within and beyond the team behind it. I have seen many cases when the team was strongly motivated but they were faced with situations they could not overcome. So always split your investments across multiple projects you have validated. This will ensure that your long term play remains intact even if you encounter a few rotten eggs along the journey.