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We have seen NFT trends, and they will continue to evolve. It is important that the value of NFT, simply, supply and demand will determine the price of any good including the NFT, but the supply of the NFT is not always limited and we need to be clearly defined. Another important thing is the add-on value, NFT will be more valuable when adding utility functions. In the future, some utilities will be integrated into the NFT. If successful, it will take NFT to a new horizon.
In today's article, we will discuss the topic of NFT with Kiefer Zang who will answer questions like NFT space around. One important thing that is emphasized for the NFT is supply. We understand if the supply is limited but such a great demand will cause any commodity to rise, but does the NFT really limit the supply? Today, we share the secrets to NFT flipping.
What is NFT?
NFT’s are verifiable ownership of a digital asset. The example I like to give is thinking about an item in a video game because most people have had some sort of interaction with it.
Let's say you have a rare sword from a video game and there's only 10 of them in existence and a bunch of players want them because they're super crazy special. In a traditional video game, you don't really own it and if you tried to sell it the game developer or studio would ban your account.
NFT really changes this and gives you total control over your digital assets because we're living in an increasingly digital world and having true ownership is a really important aspect.
How do you determine if NFT is investable or not
It is something that can vary a lot by the asset and by the specific project you're talking about but looking at it from a broad sense there's kind of the demand side and the supply segment.
On the demand side, you're really thinking about what is going to drive growth and interest. The big thing here is community. Is there a big community that's active and engaged around this game or this artist?
You also want to see if there's some kind of utility and this isn't necessarily a requirement but it is a major plus. I think this is where a lot of the growth is going to come in the NFT space especially on the gaming side. Once you have these items that people want to use within some really amazing games then there's going to be a lot of NFT demand-driven solely on the utility set. The next thing you want to look at is measures of height like are people chasing after it or are they all over social media talking about that certain thing.
On the supply side, you want to look at how scarce it is like if it is super limited edition but that's not necessarily the whole story there as you also have to look at the inflationary aspects of it but you just gotta look if the project has been putting out more and more NFT’s because if they're pumping out a whole bunch of them then that might kind of start to diminish the value of the specific NFT.