NFTs: A Beginner’s Guide to Flipping NFTs
Today, demand for NFTs continues to surge as their popularity and adoption increase globally. The trading volumes of this digital asset reached $17.6 billion in 2021. This was, in fact, a 21,000% increase from the $82 million in 2020. In addition, over 2.5 million crypto wallets were used for trading NFTs in 2021. Famous brands and celebrities have also joined the bandwagon and have been instrumental in the amazing growth in NFT transactions.
What Really Is NFT?
NFT stands for non-fungible token, which simply means that it’s a special digital asset that belongs to you and you alone. Hence, such an asset cannot be replicated or replaced -such a rare gem, right.
If you are still wondering what NFT is all about, then take a moment to imagine having an artwork that no other person has. For example, a Bitcoin is fungible — trade one for another Bitcoin, and you’ll have precisely the same thing. However, if you trade an NFT, you get an entirely different thing.
What Is NFT Flipping?
NFTs appear to be everywhere nowadays, with users flipping the asset for higher prices than they were purchased. On social media, particularly Twitter, random users talk about flipping one NFT to another for profit. Flipping means buying low and selling high. This simply implies buying a digital work or collection at a low price, holding on to it and selling at a higher value. This article will give you the insight you need to start flipping.
How to Choose the Best NFT to Buy and Flip
Because NFTs are rare, there is an innate demand. As a result, people buy and flip NFTs for a huge profit. We shall now discuss some factors one must consider when choosing a suitable NFT to trade on.
1. Choosing which NFT to flip
The first step to flipping an NFT is choosing which NFT to flip. This requires quality research. The common niche includes animal-themed art, collectibles, and abstract paintings. In choosing a suitable NFT to flip, selecting an item that can drive demand up is important. It is also important to choose an asset with a good floor price. Floor price means the least price you can get an item. Thus, you must find an item with a low floor price and the one with the least supply. Examples of such NFTs include Lucky Block NFT, Lazy Ape Society NFT, and PsychoKitties because of their current low price. This is however not financial advice as NFT trading and flipping is in fact a risky investment method.
2. Choose a marketplace and wallet
Now that you have chosen the best NFT to flip, you will need a marketplace. NFT marketplaces are platforms where NFTs can be stored, displayed, minted, and traded. Common marketplaces NFT Launchpad, crypto.com, Binance, and Opensea. You would also need a Web3 compatible wallet such as Metamask and Trust Wallet that could enable you to store your asset.
3. Buy NFT and flip
Now that you have bought an NFT, all you need to do is flip it by setting your listing price, relisting the NFT, and waiting for someone to buy it at your chosen price.
In conclusion, due to the volatility of digital assets, it is important to know the best time to sell as a flipper. Furthermore, you must make sure you are in a bull market that is trending. The best way to stay on track is by staying active on NFT communities to access latest information. In the end, NFT flipping is a risky venture and should not be deemed as a sure bet.