Do you remember them little cute NFT CryptoKitties selling for thousands per cat?
Some of those adorable little CryptoKitties even sold for over $100K way back in 2018;
Well, that was quite some time ago in the crypto space, and I would not be surprised if most of you may think that this crypto sector has cooled down from then.
However, that is most certainly not the case in the slightest.
Take a look at this;
There is an entire marketplace for Non-Fungible Tokens (NFTs) based on people’s artwork that is also selling for thousands. The particular piece of artwork is now listed at 137 ETH! Although it has not yet been sold at this price, we can see in the history that somebody paid 40 ETH, around $14,400, to get their hands on this piece of artwork last week.
You can see that people have been buying and selling this particular piece of artwork over the past week. Initially, there were three available which were sold for a total of 6 ETH each. Over time, people have been trading these for higher prices as it moved up from 6 ETH to 40 ETH, and, recently, somebody picked it up again for 50 ETH - all in the space of 1 week!
The current state of the NFTs
If you are a resident of Crypto Twitter, you will most certainly have noticed quite a few people talking about NFTs in these past few weeks.
Even some of the top DeFi innovators can’t seem to resist from talking about it;
I had posted an article not too long ago about NFTs being the next big thing of DeFi...
So, what in the world has started to make everybody talk about NFT’s all of a sudden?
Well, the answer has to be the rise of the $MEME token for sure.
What the heck is $MEME?
It all started with this following Tweet from Jordan Lyall, the ConsenSys DeFi Product Lead;
Originally, Lyall designed this as a joke advertisement with no real basis for growth. It was called “The Degenerator” - taken from the term “Crypto DEGEN” and labeled as a fictitious tool for creating yield farming tokens. However, on the same day, someone minted a token called the Degenerator $MEME and airdropped the 28,000 supply to users on Telegram.
Within a few weeks, the platform morphed from a ‘meme’ token with zero prospects into a DeFi NFT farming protocol that allows users to lock up MEME to earn crypto-collectible NFTs;
The craziest thing about this entire project is that it has managed to garner a $34 million market cap with a slogan that says “Don’t Buy Meme.” It’s on the tin. Do NOT buy this. However, it seems that the opposite effect took place, and the slogan helped to spread awareness for the project as users clamored to get a piece of the action.
The token has now soared by almost 2000% as it currently trades at a price of around $1,500;
Well, it seems that this even took the top DeFi experts by surprise as Anthony Sassano is regretful that he sold his original airdropped $MEME on day one. If he had held onto them now, his stash would be worth around $600,000;
NFTs- Where to Find Them?
So, where do you go to find these NFTs?
Well, there are 2 major platforms right now that are NFT markets with quite a sizable amount of buyers and sellers;
Rarible is probably the largest of the two with a robust community on the platform that seems to be buying and selling regularly;
There is a top sellers section on the left-hand side where you can see the most popular creators on the platform;
Let us choose one of the NFTs to take a closer look at an example. I will stick with Blue Kirby’s work - by far the biggest sellers on the platform.
Here is a beautiful masterpiece by Blue Kirby. It is called “Safe Keeping.”
You can see that it is up for sale and it is priced at 40 ETH - around $13,600. The bottom right-hand corner shows some pretty important information for this NFT;
It shows that there are a total of three of these art pieces available. That is all. There will NEVER be more than three. It is up to the creator to decide how many of these are to be created when they mint the NFT. In this case, Blue Kirby elected to go with three.
You can also choose to pay in different cryptocurrencies with a long list of ERC-20 tokens to pick from.
Just above this section, there is an information panel showing an info blurb and some information about the creator. There is also an “owners” tab to indicate who owns the other NFTs of this art piece;
We can see that Magic Kirby (not Blue Kirby) bought one and has it on sale for 60 ETH, and PopcornKirby bought it and is not selling. The last owner is from user “Out” and is the product we are looking at - priced at 40ETH.
There is also another section here labeled “history” and it shows all the previous sales from the NFT minting date;
We can see that Blue Kirby minted this 5-days ago, and they were all immediately purchased for 13 ETH each on the same day.
One of the magical things about NFTs which are bought and resold on Rarible is that original creators will always get 10% of sales;
This means that Blue Kirby will always receive 10% of the sale - regardless of who is buying and selling it for the entire future.
Can you imagine that?
All done through blockchain technology so Blue Kirby does not even have to worry about being cheated out of his royalties!
It is important to note that Rarible has its own token $RARI. With these types of mechanics, I can see artists building on this platform to continue to receive that 10% royalty fee forever.
How to Sell NFTs for a Profit
Buying and selling NFTs for profit is similar to purchasing any other crypto asset out there. It is similar to buying stocks - buy low and sell high.
However, NFT transactions occur so rarely that it is impossible to draw up any chart that you can stare at and identify any trends.
Instead, in this game, the NFTs should be seen as personal tokens for the artists - similar to how you bet on cryptocurrency projects/companies. If you believe in the cryptocurrency project, you will put your money down to purchase the tokens.
In the NFT art world, you are pretty much betting on the artist’s name.
This is quite similar to the regular art world. A famous artist can easily slab some paint on a piece of canvas, and it will be bought and resold for decades. Take the following art piece;
It is called “Concetto Spaziale, Attesa” (1965) by Lucio Fontana. He labeled it “art for the space age” and sold for a whopping $12.9 million by Sotheby’s in 2015.
Well, in this space, it is no different.
Let us take Blue Kirby, for example.
He is VERY active in the DeFi space, particularly in the Yearn Finance ($YFI) ecosystem. This is how he can gain popularity and, from there, it makes it easier for people to buy his art pieces as he is one of the most popular faces in the space.
People expect him to become much more popular over time, so they purchase his work today for thousands of Dollars to sell his work at higher prices in the future.
Blue Kirby is highly likely to continue his growth unless he slips up and gets himself involved in some sort of drama within the industry (such as promoting scam projects etc.). This is where the risk comes into play - just like any other investment on the planet!
So, I am sure you can see why Blue Kirby is already one of the highest-selling artists on Rarible. The same principle applies to all of the other popular artists on the platform as users expect their popularity to grow, so they are looking to gain a piece of their unique art NFTs early enough to sell them for a profit later.