Things you should know before you invest in NFT
Investing in NFT projects can be profitable, only if you know what to do and the red flags to pay attention to. NFT is the new trend right now in the blockchain space, everyone seems interested in getting into it and new projects centered on NFT are being launched. There are real projects and there are also scams looking to dwindle unsuspecting crypto enthusiasts, but there are ways of identifying the real and legit ones.
It will be proper to really understand what NFT is all about, it stands for "Non-fungible Token". NFT can be digital things that range from items in games, songs, drawings, to even GIFs. A typical NFT project allows anyone to transact the ownership of unique digital items and keeps track of the ownership using the blockchain.
How do you identify a legit NFT project?
1. Track record the creator(s)
It is always a big plus if the owner or the team behind the project is/are well known, this should not be overlooked. Apart from knowing if it is a red flag or not, it is important for how the sales on the project will be. People tend to transact with a project that has well known and trusted owners,always good if the creator does not have a record of rugpulls.
2. The day it was launched
This is to know if the project has not reached the stage where there is a high probability of dumping as soon as you get in, it is always advisable to get in as early as possible. It should not be forgotten that some of these projects are long term, it is crucial to know the stage where the project is.
3. Those that have transacted with the project
You need to know a few people that have bought or sold on the project, they should be real people and not bots or professional shillers. The higher the number of people that have transacted with the project, the higher the chance the project is worth investing in.
4. The origination of the project
You should know the main reason behind the project, this is where the whitepaper comes in. The origin and why the project was launched must be convincing and realistic enough, a shady whitepaper is a red flag.
5. The project's roadmap
Getting to find out the long term plan of a project is very essential, knowing if they have kept to the past goals is another good knowledge to have. Basically, every project should have a roadmap and it must be adhered to. Any reason not to follow the roadmap must be for a genuine reason, and it must be followed up. Great projects stick to their roadmaps.
OKEx, world-leading cryptocurrency spot and derivatives exchange, believes in NFTs and the potential it brings. Enjin's $ENJ, Sandbox's $SAND and Efinity's $EFY are listed on the trading exchange with liquidity.
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