Thinking about making a quick buck with NFTs? Read about my first dip into the rabbit hole and see if it is for you
Living the life of a side-hustler in the crypto-space I am always on the lookout for projects to get involved in, so you can imagine that I was pretty excited when I read about people paying millions for JPEGs and GIFs for the first time. There is nothing like reading about the next big thing in crypto and thinking “Whoa, what the hell is happening here!?” so I jumped in, started to research the subject and my next ride in the crazy world of crypto began.
For those who are just getting into NFTs or haven’t heard about it here’s a short explanation: NFT stands for “non-fungible token” and is defined as a unit of data running on a blockchain that represents a unique and (as the name says) non-fungible asset on said blockchain. Unlike tokens like Bitcoin or Ethereum each NFT is unique and, like the name says, non-fungible. People quickly realized the potential behind it and started finding ways to monetize it.
I went out and tried to make sense of this “next banger” making Millionaires. A plethora of projects got released since the early beginnings and I found a ton of success stories like the one about the infamous Bored Ape Yacht Club.
No question that I wanted to join the party and get a piece of the pie. My greedy ass got active and I searched for projects that I could join to find the next NFT gem.
…I didn’t mind a lack of individuality if the project had the potential to be the next crypto punks
Needless to say that I’ve lost about 280$ on my first NFT investment which was, of course, a PFP project. They had a shiny roadmap and threw around big words like metaverse and tokenization after the initial minting-phase was over. Their discord seemed okay at first glance, so I jumped in despite paying two third of the price of minting for gas. There I was, proud owner of my first NFT.
After paying this much for the NFT I thought I could easily list it for at least 2x, so I tried selling it on opensea. The only “downside” was I figured out too late that a NFT PFP (profile pic) project lives off its active community pushing sales. Both sales and active community members were declining for weeks already. I didn’t list my toothless buddy in the end because I wouldn’t pay another 100$ for gas, so HODL is the way to go.
That moment was my first experience of a “bad deal” in the crypto space, so I went out and read more about NFT projects and the market in general to avoid becoming another gas-wars victim in my next try.
Lucky for me, the biggest market for NFTs, Opensea, caters NFTs on a lot of different blockchains That gave me the option to look into projects with lower gas fees for listing and entering projects. One blockchain with a lot of collections on opensea is polygon. It offers super low gas fees compared to Ethereum and their highest ranking projects have a volume around 500ETH at the point of writing this.
I looked into collections around rank 100–250 and tried to find some NFTs that I liked and that had a more active and growing community. There are so many nice looking but totally overpriced JPEGs or projects with little to no active community which made it not the easiest task to find the right one.
Looking at the sales history of some projects I quickly learned that a lot of collections peak once shortly after release and fade out into lower and lower sales volume after that. Even more projects don’t even make it that far or are just blatant fakes of famous or popular other NFT collections.
After going shopping for random NFTs to hold on to I started looking for a collection that could have the potential to be in the “pre-peak” stage. It took me a while but after doing what felt like enough research I decided to grab some of my portfolio to mint myself some “Billionaire Zombies”. The project started just seven days before I discovered it and was placed above rank 100 when I got into it.
The project consists of 10,000 individual NFTs depicting all sorts of zombies. I always dig zombie stuff and their community was very active. The projects roadmap sounded like a lot like every road map of a PFP-NFT project. A little bit of Mint -> sales & community -> staking/tokenization -> metaverse…
Being on the lookout for a rather a short time-frame investment, I didn’t mind a lack of individuality if the project had the potential to be the next crypto punks.
I decided to mint a total of 13 NFTs over time and got active in their community. It was a lot of fun but knowing about the concept of multi-level marketing, I knew that a big part of the community consisted of just hyping the project to pump interest.
I highly recommend you to read this article if you are not familiar with the concept of MLM.
The projects sales volume slowly climbed up and the project jumped more than one rank on opensea almost every day. Then the day came that the minting phase ended and the next phase of the project started shortly after a period of built up suspension about this “next level” of the project.
Sales started to go crazy (for my experience) and climbed from 0.0009 to 0.09ETH in a matter of weeks. The makers of the project released mysterious keys to early holders as part of the next step. I was lucky enough to get one. After the release of those keys the community started to get a little bit too focused on “raising floor prices” and a weird vibe started to flow, that started to worry me and made me sell off all of my zombie NFTs and my elusive key shortly after prices were at their ATH.
Participating in this project was my first big win in crypto. I made more than enough and had a great time with the members of the community.
On one side I’m grateful to live in a time and place that grants the possibility to earn yourself more financial freedom with freely accessible knowledge. Against that stands some foul feeling of having participated in some kind of scheme that (almost) always ends bad for most of the participants.
In the end I decided for myself that it was super cool to have been part of a fun social club for some time and to have taken home enough to keep learning more about the world of blockchain. It was’t hard to learn about NFTs and the very basics to spot possible investments, be aware though that timing is key in this type of business. I am not going back to flipping NFTs but I am sure that the time will come when I want to have a piece of abstract digital art.
Thanks a lot for taking the time to read this article, if you liked it and want to support me you can follow me and leave some claps and comments below :)
All the best for your investments.
Feel free to reach out if you have a project that you want to share or hear my thoughts about.