Seriously, Are NFTs Art? Why Investors Need To Care

Jadson Thomas via Pexels

The Troubling Life Cycle Of An NFT

NFTs turned the technology adoption life cycle into an out-of-control roller coaster in its short 8 years. An NFTs function has been taken over by investors, but just like any other investment, prospective NFT owners need to understand the underlying asset.

What Does An NFT Do?

Do not let perfection get in the way of an effective market approach analysis. It is unrealistic to expect to find a replica of the company or asset you are reviewing.

NFTs Unique Value

The intrinsic value of NFTs is subjective to each user based on his or her experience. Herein lies the tricky aspect of an NFT, this value cannot be projected in dollars or cents expected to be generated per year.

Limitations Of The Market Approach

Be wary of blind reliance and overextending the takeaways from your market approach. Do not use this approach to assess value at an individual NFT transaction level, the Salvator Mundi auction does not indicate the value of any NFT on the market.

What Does This Mean For You?

If the NFT market is being controlled by the few, then you must become an expert before investing/trading. Physical art buyers and sellers rely on experts to project value, you either need to attain that level of expertise or rely on an expert to safely trade NFTs.

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Matt McDonough

Matt McDonough

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Hello! I am a CPA by day, writer by night, and adventurer on the weekends. I’m on the lookout for fun ideas to read, please send anything interesting my way!