1. Invest in Promising New NFTs Early
One of the best ways to make money on an NFT is by investing in promising new collections early before they skyrocket in value. Many of the best NFTs to buy were initially minted at a low price, with their value increasing exponentially in the weeks and months after launch.
A prime example of this is CryptoPunks, which could be purchased in 2017 for between $1 and $34. When the NFT craze took over in 2021, these ‘Punks’ became incredibly valuable due to their first-mover status within the space. This culminated in these NFTs being purchased by celebrities and other high-profile names – with one Punk even selling for $24 million!
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2. Play-to-Earn NFT Games
Take part in play-to-earn NFT games.
Using NFT games to make money has become a popular approach, with numerous exciting platforms springing up that offer a way to generate consistent income.
Since most important in-game items are structured as NFTs, the digital currency earned as rewards can be ‘reinvested’ into better items in the form of crypto. You’ll also have the chance to earn unique digital items that carry in-game value, such as those linked to characters, clothing, and even plots of land – leading to increased performance.
3. Minting Your Own NFTs
Minting refers to the process of taking a digital asset (such as digital art or music) and placing it on the blockchain. Once the asset is minted to the blockchain, it can then be traded on the best NFT marketplaces, allowing you to monetize your creation.
Minting NFTs is a relatively straightforward process, with top marketplaces like NFT LaunchPad making the process easy for beginners. Due to the enormous growth in the NFT market, the competition among creators is intense, with new collections springing up every day. Thus, if you wish to take this approach, you’ll need to ensure that your creation stands out from the crowd.
Assuming you have created your own NFT and minted it to the blockchain, it’s just a waiting game to see if someone buys it. This is where marketing plays an important role, as most collections will not be visible to potential investors unless they are promoted effectively. Once your NFT sells, you will receive the proceeds from the sale (minus the marketplace’s fee), which you can withdraw to your crypto wallet.
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4. Generating Royalties
Royalties go hand in hand with selling NFTs and form one of the most exciting elements of the market. During the minting process, the creator can set their own royalty percentage, which means that any secondary market sales will provide the original creator with a payment. Most NFT royalty levels are set at 5% or 10%, although some do go higher than this.
Many of the most expensive NFTs will have a royalty percentage embedded into them, which provides the creator with passive income whenever they are resold. Certain NFT marketplaces will cap royalties, usually around 10%, to ensure that these assets are still attractive to future investors.
5. Earn Interest on NFT Gaming Rewards
An indirect way to make money with NFTs is to earn interest on the rewards that you make in a P2E game. Like FIAT currency, these token rewards can be placed into crypto savings accounts to generate an annual yield. Often, these yields are far higher than with traditional banks since cryptocurrencies are in such high demand.
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6. Invest in Companies with Exposure to NFTs
Invest in companies that have exposure to these assets. If you buy stocks in these companies, you will receive indirect exposure to the NFT market, which allows you to benefit from its growth.
Given that the market only really took off in 2021, there is a limited number of companies that provide services related to NFTs. Coinbase is perhaps the most prominent company involved with these digital assets and is developing its own NFT marketplace, set to launch soon.
Some of the best metaverse stocks will also be related to NFTs. Meta Platforms leads the way in this regard, although companies like Roblox and Nike have also ventured into the NFT market. Overall, this approach will likely become more popular as the market expands, presenting an exciting opportunity for equity investors.
