8 Painful Lessons About NFTs
What I Wish I'd Known a Year Ago
I got into the NFT space a year ago.
What a year. Since last September, we’ve seen at least two bear markets and a lot of so-called experts leave the space… or get booted off Twitter for shilling and pumpin’
We’ve also seen NFTs make headline news on the Tonight Show only for mainstream media to write them off as a scam.
Here are 8 lessons I learnt about NFTs this past year.
1. Most Projects Will Go to Zero
Apart from a few bluechips like BAYC, CryptoPunks and Art Blocks, most projects are down big time on where they were a year ago. And many more are near zero. And that’s before you factor in the price of Eth. If you’ve an eye on one of the older NFT bluechips, you may get a chance to pick it up yet, although don’t try and catch a falling knife.
2. Don’t Ape In
Instead of fomo-ing into every NFT mint or project du-jour, wait. Chances are the project will either drop (see lesson 1) or Eth will drop (see May). It’s also unclear what will happen to the price of Eth and how this will impact on NFTs following the pending merger in September.
3. Not every NFT needs a roadmap
Most of those NFT roadmaps are boiled plate, full of hopium or rely too much on buzzwords like Metaverse.
I attended a talk by an NFT artist a while ago who made the point that generative art doesn’t need a roadmap. Buy because you like it or want to collect (DYOR!).
4. The Space is Rife with Scammers
Crypto was always bad but there’s something particularly seedy about the NFT space because it allows bad actors to hide behind JPEGS or run away with people’s Eth because they lost interest in a project.
Then they launch a new project and put it down to “lessons learnt”. If you read it on Twitter, assume a sceptical mindset.
5. Don’t Believe the Shillers on Twitter
I’m talking about all those tweeting “I’ve got 20Eth, what will I sweep the floor on?” And the “Smoking weed, buying NFTS” crew…
A lot of Twitter influencers were hiding behind JPEGS to pump their own bags or shill NFTs that were never going to make it. That’s one of the biggest problems with the space.
It’s pretty quiet on NFT Twitter these days (unless you count the ENS space) and many have left Twitter or been shut down. In fact, now is a good time for getting into space and finding legit people to follow.
6. The World Doesn’t Need Another 10k PFP Collection
The world already has one Yuglabs and Bored Ape Yacht Club. We also have Lazy Lions, Pudgy Penguins, Cyberkongz, Moonbirds the list goes on.
Future NFTs collections aspiring for future bluechip status need to do more than rip off the Yugalabs playbook of cartoon animals into cute cartoons with a Metaverse play.
7. We’re Still Early
Some feel like they missed out on NFTs are the BAYC bull run. I know I did. So here are some comforting stats:
Only two million OpenSea users
2.2 million ENS domains.
That’s vs 103 million Coinbase users and 160+ million Dot Com domains. In other words, the NFT space has a long way to go before approaching mainstream adaption.
You can use Dune Analytics to reference stats like these as part of a good DYOR process.
8. The Pricier Mint the More Likely It Will Fail
Karafuru was one of the biggest mints of early 2022. At one point the floor price approached 5Eth. It's down big time since then, hovering around 0.2-3 Eth.
Conversely, two other free big, stealth mints - Goblins and DigiDaigaku- are both up. They’ve also captured more marketshare. The ENS clubs were all near free to min up until May of this year. Perhaps the days of overpriced mints are FINALLY behind us.
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