NFT Investment: How NFT can be a good investment for beginners

By Gretchen Clarke- Mar 13, 2023 16

Non-fungible tokens (NFTs) have been recognized as an interesting presence in the cryptocurrency world. NFTs can easily tokenize physical and digital assets. This could create a vibrant new ecosystem where market participants can trade art, music, in-game items, and more. NFTs are also ranked as the most popular after virtual currencies, so it's important to be aware of the details.


In this article, we briefly explain what NFT investing is, and show you how to buy advertising investing in NFT today. We will also introduce NFT investment options, such as NFT-related stocks and NFT-related investment trusts.


What is the best NFT investment?

Those who are looking for something that will grow in the future with virtual currencies may be very worried about NFTs.


Investing in featured NFT games, art or other projects seems interesting. It is important to first gain a broad understanding of what NFTs are and how NFT investments work. NFT stands for "Non-Fungible Token" and refers to a digital token used to confirm ownership of a specific asset. NFT trading volume tends to be digital art, music, and blockchain game items, but any asset is fine.


NFTs are hosted on the blockchain, the decentralized network that underpins many cryptocurrencies. Bitcoin was the first to popularize blockchain technology. But since then several compelling networks have developed to build on the foundation that Bitcoin laid. Ethereum is one of them, and the Solana, Cardano, and Binance smart chains are also heavily involved, but it has become the leader in the NFT space.


If you are interested in investing in NFTs, you can do so using the NFT Marketplace. Offering NFT marketplaces offer easy-to-use online portals where investors can browse NFTs created by other users and buy them if they wish. In most cases, NFTs are offered at a fixed price or in an auction, where investors can bid until someone wins. NFT.


NFT is based on the cryptocurrency ecosystem. Hence, it is necessary to obtain a wallet to store NFTs and to store the cryptocurrencies required for smooth transactions.


Are NFTs Good Investments?

So, are NFT Art and NFT Games good investments? There are currently many non-fungible tokens in the market. Utility NFTs, like NFT horse racing schemes and NFT land schemes, make it difficult to make the right decision. Some providers have even started offering NFT gifts as a new incentive.


Here, let's dig into five key points to keep in mind when researching how to invest in NFTs.


      Increased potential value

One of the main attractions of investing in the NFT industry is the potential appreciation that can occur over time. A prime example is CryptoPunk 1422, which was purchased in 2017 for $74. However, BusinessInsider recently revealed that this NFT was sold for $2 million in October 2021. This example suggests that many NFTs have the potential for dramatic price increases.


      Access to exclusive bonus content

Investing in NFTs can give you more than just great art and music, you can also get exclusive bonus content. A common example is an NFT collection creator inviting owners to an event or offering additional NFTs via Airdrop.


      Join an exclusive community

High-end NFTs often allow their owners to participate in an exclusive "community" that sets a certain value for their assets. A famous example is the Bored Ape Yacht Club, which runs a Discord server where other Bored Ape owners, including celebrities and public figures, gather. Ownership gives you access to our community-driven message board and bathroom.


      Creators support

It's also a good idea to buy and invest in recommended NFTs to support creators. NFT is a wonderful mechanism that allows creators to publish their work and allows fans to support them by purchasing their work.


      Showing ownership is easy

Since NFTs are "non-fungible" by design, many NFT owners display their assets as profile pictures on social media. NFTs cannot be copied because their ownership is fixed by blockchain technology.


Best NFT for investment

Understanding high-value assets are very important when investing in NFTs. Here are five types of NFTs that are particularly recommended and why.



How to invest in the Metaverse – Metaverse NFT

Another popular way to invest in the Metaverse is through NFTs. The best NFTs of the past years have become part of metaverse-based projects due to their valuable features. One of the things that makes NFTs attractive from a metaverse perspective is their ability to provide "true" ownership of the assets in play.


For example, the game-playing cards in the Metaverse game "Gods Unchained" are structured as NFTs. This ensures that all player cards are theirs and cannot be stolen or tampered with. This dilutes the concept of cheating and hacking and keeps them out of the game.


Investment in NFT-related stocks

Buying an NFT gives you direct access to a specific asset. Investing in NFT-related cryptocurrencies gives you access to cryptocurrencies that power the economics of NFT projects. If you want to invest in the broader NFT sector, you should invest in NFT-related stocks. As their name suggests, these companies have direct or indirect exposure to the NFT sector, allowing equity investors to invest in the growth of the sector.


NFT stocks include brands that create NFTs and sell them on respected marketplaces, as well as game companies looking to enter the NFT space. Currently, many companies are not using NFTs as their business model, but this may change in the future. Check out our top 10 picks for Metaverse stocks for diversification.


Like buying Bitcoin, investing in NFT companies is still highly speculative. Because the NFT market is relatively young compared to other markets, investors are still trying to understand the intricacies of how asset prices are affected by specific factors. As such, buying shares of this company may be more attractive to risk-averse investors than to risk-averse investors.


Are NFT-related stocks a good investment destination?

Even if you're only interested in investing directly in NFTs, buying NFT-related stocks can give you exposure to a broader market. But, just like buying cryptocurrency, entering the stock market in this space tends to be more volatile than buying existing stocks.


That said, there are several advantages to buying NFT-related stocks. These are:


Gain Broad Market Exposure: Investing in NFT stocks like Coinbase gives you broad exposure to NFT market growth. Thus, if the market expands over the next few years, it could have a positive impact on Coinbase's earnings and drive the stock price higher.


A "safer" way to invest in NFTs: As the stock market is established, investors may feel more comfortable buying NFT-related stocks rather than buying NFTs directly. Also, while the stock market is highly regulated, the NFT market is not.


Easily accessible in fiat currencies: Listed NFT stocks can be easily bought and sold through trusted brokers. Additionally, these brokers deal in fiat currency, so you can buy stocks instantly by linking your credit/debit card.


NFT investment trust

NFT Investment Trusts are securities that track an index of NFT-related stocks. Holdings include trading platforms such as NFT marketplaces, blockchain networks where NFTs are issued, and companies committed to commercializing NFTs.


Among these assets, it should be noted that they do not actually trade NFTs. NFT Investment Trust invests only in companies that are somehow related to NFTs and does not buy or sell NFTs.


NFT mutual funds are a very recent development. Given the high level of interest in these digital tokens, we may see more NFT mutual funds in the future. However, don't expect to see a large influx of funds anytime soon. Despite the popularity of cryptocurrencies, the number of cryptocurrency mutual funds is limited. NFT investment trusts will take time to grow.


Defiance ETF is the first company to launch an ETF for NFTs. The Defiance Digital Revolution ETF holds over 30 stocks and has a low expense ratio of 0.65%. Its largest holdings include GameStop, Funko, eBay, Coinbase, and cryptocurrency mining company BIT Mining Ltd.



In this article, we have thoroughly explored how to invest in NFTs. We've tried to cover all the basics related to NFT investing and show you how you can get started today. You can also invest in NFT-related stocks and NFT-related cryptocurrencies.