How To Pick Your First NFT
We’ve explained what an NFT is and how they work, but now perhaps you are ready to buy one. Maybe you are asking yourself, what should I consider when making my first NFT purchase. Don’t worry, we’ve broken it down for you.
First and foremost, we recommend picking something you like! Much like you would pick a piece of art to display in your home, find something aesthetically pleasing to you.
After that, many people will look at the following questions:
1. What is the asset?
Some popular examples of NFTs include in-game assets, digital art, 3D models, and even audio files.
2. Who created it?
What is the community like around the NFT? Do other people seem passionate about it?
If you’re looking at a piece of digital art, for example, chances are good that the artist has an online following. If that’s the case, you can often get a sense of how active and engaged the Web3 community is by taking a look at their social media accounts.
3. What’s the purpose of the NFT for you?
You’ll want to think about what you want to do with the NFT. You could be interested in playing games where your in-game items are NFTs with utility, or are you looking to collect it, trade it, or use it for something else?
While you cannot guarantee the return of anything as an investment, that is a common thought process going through many people’s minds when looking to get into the NFT space.
4. Is the NFT backed by anything?
Some NFTs are backed by actual assets, like gold or land. Others are simply digital files with no physical backing. There is no right or wrong answer here, but it’s something to consider when making your decision.
5. What is the price?
Of course, you’ll need to consider the price when choosing an NFT. There are a lot of different factors that go into pricing an NFT, so you’ll want to make sure you’re comfortable with the price before making your purchase.
6. What are the risks?
As with any investment, there are always risks involved. You’ll want to do your research and understand the risks before buying an NFT.
These are just a few of the things you’ll want to consider when picking your first NFT. As we said earlier, ultimately, the best way to pick your first NFT is to find something you like and go from there.