In this education guide we will learn how to anaylise NFT projects in all aspects.
To begin with, Hype might be the number #1 factor of return on investment (ROI).
To be clear, even the worst projects out here can bring you good profit if there is enough hype/marketing behind it.
Infos
You can get a good idea of how well the project is evolving just with basic public information. Which are:
- The mint price
- The total supply
- The number of Twitter followers
- The number of interactions
“The laws of supply and demand drive up the price, inevitably, over time. But solar and wind are abundant and renewable resources.” – Van Jones
Let’s say the project you’re looking for is minting for 1 SOL, has a total supply of 5000 pieces, and counts 17000 Twitter followers with hundreds of Twitter/Discord interactions. You can already establish that there will be more demand than supply so that you can make some profit. And I can say this without even knowing who is behind the project, what’s their vision and their plans.
On the other hand, if there is more supply than followers and a mint price is too high (more than 2 SOL is considered high for SOL) then you should probably avoid it.
But be careful! Some projects like to play it under the radar until minting/delivering, that’s why you have to check who is running the project, why, how are they funded, and what’s their plans and vision.
Doing such research is called fundamental analysis.
Fundamental Analysis
We can agree that knowing who is running the project you’re looking at is mandatory.
Are they kids? Professionals? Experienced? Dedicated?
Have they built any Web3 projects before? If so, is this project still alive? Is it successful?
What are the skills of the devs? Their behavior? Their connections?
Are they backed by anything? Do they have the funds to deliver?
It’s a ton of questions anon, for sure. Anyone with common sense could already say that the answers to those questions are meaningful.
Get informed
Just use everything you possibly can. Hang in their discord and ask them directly, dig some information on their website, their Twitter posts, and their Discord. Ask your friends, scan their wallets, inspect LinkedIn profiles… Read Twitter threads, do whatever you have to do to get some info.
Now, what do we do with such info?
You’ll chase hype, innovation, and dedication.
Is the project you’re looking at bringing innovation into the ecosystem? If so, how so, how innovative is it? If it’s ambitious, do you think the team got what it takes to deliver?
I’m sure you see where I’m going while writing those lines, gathering info, and finding hidden gems. If you spent a few minutes on Solana’s Twitter, you surely already heard the famous “I invest in people rather than product” It’s worth most of the time. Bet on people, people with an innovative vision, people with skills, and dedication. And if on top of all of that your project is hyped. You’re about to hit the W.
What about a hyped project that isn’t innovative?
Well, good question, we’re trading the market right? So we’re trading the hype. If your project got decent hype but no utility/innovation I’d just flip it for some quick profits. Ride the hype and get out when everyone is talking about it. Sometimes utility/innovation can be very very tricky to spot, let’s take Okay Bears (NFA DYOR), for example, utility/innovation is in their branding, they did things differently from other ‘PFP’ projects, and they have a big vision compared to other projects and they’re doing what it takes to achieve it.
On the other hand, I’d feel more comfortable investing in a not hyped/less known project that is innovative and led by dedicated builders like GeometryFinance (NFA DYOR). At the end of the day, it’s a conviction game. There are a few collections I’m really bullish on that don’t have the attention they deserve now, so I keep adding these, hoping for a rally when people find out about it.
