Don’t Be Fooled: The Lifecycle of an NFT

Too often buyers ape into NFTs for the wrong reason. If you’re in it for the money, you are guaranteed to get burned, but if you’re invested in the idea surrounding decentralized art and empowering artists then it’s important to understand the lifecycle of NFT projects.

The Evolution of an NFT Collection

  • Project launches
  • You mint/buy NFT
  • There’s lots of hype
  • Floor price goes up for a couple days then eventually hype dies
  • Floor goes down
  • People sell for a loss/hold accepting project is dead
  • Devs keep working in the background
  • Floor goes up as people realize it’s not dead
  • People buy in higher than what they sold for
  • People holding regret not buying more

 

If you would have held your CryptoPunk from 2017, today it would be worth at least 6 figures. Source

The Harsh Truth

If you’re antsy and aped in for the wrong reasons you will never make it through this cycle. You will sell early and end up taking a big loss.

Less than 4% of the world owns any cryptocurrency, believe it or not, we are still incredibly early. True art projects mature and grow in value overtime so don’t sweat a little volatility, the market will correct itself overtime.

To be successful in NFTs, only collect projects you’d be willing to hold your entire lifetime, then you can sell in a year or two if the price does happen to moon.

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