NFTs have taken the world by storm over the last few years, and many people making a lot of money out of them. If you’re interested in buying or selling NFTs, your first question may be whether they rise in price over time.
NFTs rise in value if there’s a demand for them and people continue to buy them. Another reason is that owning an NFT means you are the direct owner of that piece of art, making it valuable in many people’s eyes. Growing popularity also causes the value of NFTs to rise.
This article will talk about why NFTs rise in value in more detail. It will also determine what might cause an NFT to lose value, talk about the different types of NFTs, and discuss if it’s easy for someone to copy an NFT.
Why Do NFTs Rise in Value?
NFTs rise in value because they usually represent art, and people like to own original art pieces. Many people are willing to pay a high price for them, and this trend continues as the popularity of NFTs grows.
But there are many things to consider when it comes to NFTs rising in value. Below, let’s look at these reasons in greater detail.
Demand
The first thing to consider is demand. As the demand for something increases, the price will naturally increase. This is particularly true for NFTs that are scarce or made by a significant person in society, such as a celebrity or a sports star.
NFTs are in such high demand right now because of social media and people hearing about others making lots of money by selling them. It’s also easy for anyone to buy and sell NFTs—you don’t have to be a computer programmer. This means everyone has access to buying and selling NFTs.
Opportunity To Own an Original Piece of Art
It’s no secret that many of us like to own original, one-of-a-kind art pieces. This is because, in many cases, original pieces are valuable. By owning an NFT, you become the sole owner of that piece of art. And, as studies have shown, rarity is a leading factor in the value increase of NFTs.
This idea is attractive to many people, which is why they decide to buy and sell NFTs. Ultimately, this drives their value up.
Rising Popularity
NFTs have continued to rise in popularity over the last few years. As long as they remain popular and continue to grow in popularity, the prices will remain high and even increase.
NFTs are a way for people to express themselves and their art in digital form while making money at the same time. This is one of the big reasons why NFTs are so popular and have continued to rise in popularity.
The Technology Is Still New
The underlying technology of NFTs, known as blockchain technology, is still new. Many people see a lot of potential for this technology, and some even believe it could become much more mainstream in the future.
When something is new and innovative, it excites people. It motivates them to get involved in something that has a lot of potential and could make them profit.
Plus, the technology that backs NFTs is the same technology that supports cryptocurrency, and many NFT fans are also crypto fans.
People who believe that cryptocurrency will continue to grow in value will also want to invest in NFTs, and that’s another reason why the value of many NFTs will continue to rise.
People See NFTs as an Investment for Their Futures
Although many people want to make fast profits from NFTs, others see them as a long-term investment for the future.
Nowadays, there are many ways to invest in your future or make a passive income, especially when it comes to NFTs and cryptocurrency.
Since many people believe that their NFTs will rise in price in the future, they’re seen as a highly attractive long-term investment.
Can NFTs Decrease in Value?
Now that I’ve discussed why NFTs might rise in price, it’s essential to know whether they can decrease in value. And if they can, what causes their values to fall?
NFTs can decrease in value at any point. Since NFTs rely on cryptocurrency to be bought and sold, a crash in the crypto market could cause a crash in the NFT market. Alternatively, people can simply lose interest in certain NFTs, causing the demand to decrease.
Let’s take a closer look at why NFTs can decrease in value.
NFT Saturation
Saturation is one reason why NFTs can decrease in value. Since NFTs have become highly mainstream now, many new NFTs are being released daily. Due to the vast array of options available, it can be challenging to make a lot of money from NFTs. And as more and more are released each day, the value of many NFTs could decrease.
Crypto Crash
Since NFTs rely on cryptocurrency and blockchain technology, a crash in the crypto market could significantly affect the value of NFTs.
A crypto crash would also uncertainty surrounding the future of NFTs. Many people might be scared that a crypto crash indicates an NFT crash will soon follow, so they’ll try to sell everything they own, causing the value of NFTs to decrease.
People May Lose Interest
Another possibility is people losing interest. Although NFTs and blockchain technology have been around for many years now, they’re still new and exciting. No one knows what the future holds, but people may lose interest if the hype begins to die down at some point.
And when people lose interest in NFTs, their value will naturally decrease.
NFTs as an Investment
Many people see NFTs as an investment opportunity. They believe that they can buy NFTs and hold them for a few months or years in the hopes that their values will increase. Then, when the time is right, they can sell them for a profit.
Investors have done this and continue to do this, and it has proven to be successful in some cases. However, it’s not always profitable, and many NFT projects lose all their value after a while.
You should only invest an amount of money you can afford to lose. You should also make sure that you have a budget to prepare for any situation.
Here are some essential points to consider if you’re planning to buy NFTs as an investment:
You Need a Crypto Wallet and Cryptocurrency To Invest
Before investing in NFTs, you’ll need a crypto wallet that supports Ethereum—at least if you’re using OpenSea. You’ll also need some Ethereum crypto to buy the NFT.
The most popular wallet for the OpenSea marketplace is MetaMask, so you could start with that one.
You Need To Be Prepared for a Decrease in Value
While you’re likely preparing for the value of your NFTs to increase, you also need to be ready for the value to decrease. If you mentally prepare for that, you won’t be too disappointed should anything bad happen with your investment.
But of course, even if the value decreases, it doesn’t mean it will remain that way. Since NFTs are volatile, you have to be ready for anything!
You Need To Research the Seller Before Committing
You want to make sure you’re not buying a fake copy of a popular NFT. If you feel like the price seems too cheap, it’s likely because it’s a scam. One of the easiest ways to confirm a seller is legit on OpenSea is to make sure they have the blue tick logo on their profile.
If you purchase a fake NFT, it will be (most likely) worthless as soon as you buy it. That’s why it’s vital to ensure you’re buying a legit NFT from a legit seller.
Will NFTs Be Worth a Lot More in 10 Years?
NFTs could be worth more in 10 years, but it’s uncertain what the future holds. NFTs and blockchain technology may become more mainstream and accepted in society within the next 10 years, but it’s also possible that they will die out completely.
Of course, you can invest in NFTs and plan on holding them for 10 years in hopes their value will increase tremendously, and you might get lucky.
But it’s important to remind yourself that it might not be the case, and your NFTs might decrease in value due to some (or all) of the reasons mentioned earlier in the article. Once you’re ok with that possibility, you should have no issues holding your NFTs for the next 10 years.
Creating NFTs for Passive Income
Creating and selling NFTs can be an excellent way to earn passive income. All you need is:
- A computer
- A crypto wallet
- Some crypto
- An NFT marketplace account
People will be more likely to buy your work if you have any artistic talent. However, you need to be aware that there are fees involved with making NFTs. Be sure to incorporate these fees into your selling price so that you don’t lose out on any profit!
Other than creating and selling NFTs, there are several ways to make money passively. For example, you could consider something not NFT-related, such as renting a parking spot. It’s good to have an idea of all the different passive income options before making any significant decision!
Types of NFTs
There are many different types of NFTs out there. Some may be more likely to increase in value than others. Although most people think of digital art when they think of NFTs, there are other types you can buy and sell.
Of course, art is the most popular and one of the best ones in terms of profit, but it’s good to know about other NFT types.
Art NFTs
Art NFTs are the ones most people are aware of. There are two main ways people can sell art NFTs:
- They can draw digital paintings and sell them as NFTs.
- They can create a physical artwork, take a photo of it, and upload the image to their computer to sell it as an NFT.
Many art NFTs can increase in value because they’re often one-of-a-kind pieces that many people want to own. This is especially true if the art is impressive and high-quality.
Metaverse NFTs
Another prevalent type of NFT is the metaverse NFT.
The metaverse is a virtual world where people can play games, create avatars, earn money, and buy/sell a variety of things.
Different metaverses currently exist, an example being Decentraland. These metaverses rely heavily on NFTs for gameplay. And as the popularity of the metaverse increases, so does the value of the NFTs.
You might be wondering what kinds of NFTs you need for the metaverse. The main ones are land NFTs (these are essentially blocks of virtual real estate) and object/clothing NFTs.
Many investors have been purchasing land NFTs in recent months because their popularity has been growing, and some believe virtual real estate could be highly valuable in the future.
Music NFTs
Another type of NFT that isn’t as popular is the music NFT. These can be an excellent way for musicians to earn some extra money.
A musician will record a piece of music and then sell it as an MP3 file. Whoever buys the NFT has full rights to the music and can resell it or use it. If a piece of music sounds good and has potential for rising in value, people might be willing to pay a lot of money for it.
Conclusion
The value of NFTs can rise, but it can also drop. Like cryptocurrency, the NFT market is highly speculative and volatile, so there’s no telling what the future holds.
Some of the things that cause NFTs to rise in value include:
- Increasing demand.
- Excitement about the new technology.
- The opportunity to buy/sell original artwork is attractive to many people and is seen as highly profitable.
However, crypto crashes and loss of interest can cause NFTs to decrease in value, so it’s crucial never to invest more than you can afford to lose.
