If You're Not Investing in NFT, You're Doing it Wrong
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Investing in NFT's |
Introduction :
What does the future of cryptocurrency look like? This question has many different answers, depending on who you ask. If you ask me, though, one of the most exciting developments that will take place in the next year or two is the mass adoption of non-fungible tokens (NFTs). The number of unique digital assets will far exceed the number of Bitcoin or Ethereum tokens in circulation, which means it’s time to start thinking about what investing in NFTs will mean for people who want to invest in cryptocurrencies.
- What is an NFT?
- Why should you invest in NFTs?
- How do you choose which tokens to invest in?
- Now For the Hard Part...
What is an NFT?
A non-fungible token is an interactive crypto collectible. Each NFT is unique and cannot be exchanged for another token. Popular non-fungibles include CryptoKitties, Rare Pepes, CryptoPunks, Etheremon cards, and Cryptopunks. The market capitalization of all NFTs stands at $1.5 billion USD as of May 2018 with only 3% of the total cryptocurrency market cap invested in them so far (as of June 2018).
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Why should you invest in NFTs?
NFTs are digital assets that are unique or non-fungible. The ownership of NFTs is recorded on a blockchain, similar to how cryptocurrency transactions are recorded. Unlike cryptocurrencies which can be divided up and transferred multiple times over to other users, NFTs are non-divisible. This means an asset can only be owned by one user at a time. Since they cannot be easily divided into smaller parts without compromising their value, there is no risk of fractional reserve banking with NFTs.
How do you choose which tokens to invest in?
The market for non-fungible tokens is still relatively new and immature. While there are certainly a lot of risks involved with investing in cryptocurrency—not least of which being that most experts say we’re currently experiencing a bubble—the technology itself has immense potential. The real question you need to ask yourself is: how do you decide which cryptocurrencies to invest in? With such a wide variety of tokens out there, each promising its own benefits and strengths, it can be hard to figure out where to start. Here’s what you should consider when picking your next crypto investment: ...
Now For the Hard Part...
Before you set out to invest in cryptocurrencies, take a moment to consider what exactly your plan is. Do you want to be an active day trader? A passive investor? Whatever your plan of attack is—and as long as you’re informed and careful—then there should be no problem. It’s all about doing what feels right for you! With that said: here are some things to keep in mind.