Minting an NFT, or non-fungible token, is the process of publishing a one-of-a-kind digital asset on blockchain marketplaces so that it can be purchased, sold, and traded for profit.
Although it is currently fairly simple to create an NFT, there are many hidden hazards.
How should an NFT project be evaluated before deciding on NFT Minting Website Development?
Before beginning any new project, it is critical to ask yourself the right questions and establish the necessary protective reflexes. The team and roadmap, the community (Discord and Twitter), scarcity and pricing, technology, and, of course, the core project must all be considered (art and utility).
The Team and the Roadmap
The team analysis is an important factor to consider. Is the team completely unknown (doxxed), only partially known (anonymous), or none of the above?
However, if the crew is anonymous, as in some successful initiatives, this is not uncommon in the Web 3.0 ecosystem. It is preferred that the team not remain anonymous, i.e., that we know their names, ages, professional experiences, and so on, because you are less likely to face certain risks (rug, soft rug, project dropouts, etc.).
What information about the team’s past do you need to know if they are doxxed? If you can analyse their relevant previous experience, you should consider whether it is related to NFTs. Do they have any previous experience in the industry? The founders do not have to be well-known, but they must have relevant experience.
At this time, may we also assess the team’s reputation? For example, if a member had previously been involved in a questionable venture, this would be a major red flag. On the other side, if one of the founders had previously been involved in a successful firm, this would be seen favourably.
Even though the roadmap is frequently merely a prediction of the project’s future, it is nevertheless important to examine it. The best course of action is to favour creative notions with a practical vision. You should also be aware that the roadmap is rarely followed in practice because its content is established by the long-term aims of a project rather than by a predefined structure.
On the other hand, you can evaluate the roadmap’s expected practical approach in relation to the project’s financial resources. Is the team capable of executing the strategy, and does the overall plan make sense to you?
Social network analysis is a critical component of the research. The community component is critical in the majority of NFT programmes. We can, however, make an exception for purely aesthetic collections such as generative art, where this method is not always as accurate.
NFT efforts mostly leverage Twitter and Discord as social media outlets.
Less than 10,000 Twitter followers are significant enough to consider. more than 100,000? Beware because projects may easily buy fake fans, and the number of followers on the surface means nothing.
A simple approach to check is to see if the account’s follower count and engagement levels match (likes, comments, retweets, etc). As a result, if the engagement rate appears unusual, this should alert you. Ideally, the project should not have too many purchased followers gained through rewards and whitelist competitions (WL).
Another crucial element to consider is whether prominent collectors are following the project’s Twitter account. (For example, Zeneca, Punk6529, and Takao.) Indeed, having whales keep an eye on the project is frequently advantageous. However, this does not always imply that they support the idea. Simply put, they are curious.
Discord is required in the NFT ecosystem for minting an NFT. Indeed, the majority of initiatives use this type of social network to build their community. As a result, the number of members must be reviewed in the same way that it is on Twitter. It is necessary to verify their authenticity. Interaction on posts and the activity of members might be important indicators.
It’s also interesting to compare the number of Discord members versus Twitter followers to see if they agree or disagree.
For both networks, it’s crucial to assess whether these followers were obtained organically. For example, observing invitational events for WLs could be a bad factor. In reality, Discord is more likely to be inhabited by bots or multiple individuals.
Rarity and price
The quantity of NFTs and the mint price are two critical aspects of the analysis. A project cannot escape these two pieces of information.
Rarity and scarcity
As a result, is it reasonable to inquire about the availability of NFTs of 1,000 words or less? between 1000 and 5000? around 5000 to 10,000? more than 10,000?
A supply shock is more likely when the supply is low. However, in order to correctly analyze this criterion, it is critical to place it in context with the project’s interest and community engagement. If a project provides 10,000 NFTs and receives only 20 likes on Twitter on the day of the NFT sale, the supply was definitely too high.
Pricing is an important consideration. Does it correspond to the collection’s value or the marketing hype? Is the pricing reflective of the market’s state?
By the end of 2021, cost was no longer a crucial factor. On the other hand, it may begin to do so during less buoyant market conditions.
What blockchains, including Tezos (XTZ), Solana (SOL), and Ethereum (ETH), are NFTs based on? Naturally, Ethereum has the most established and largest NFT ecosystem (ETH). For generative art, we may also incorporate Solana and Tezos (XTZ) (SOL).
Other blockchains that use NFTs include Flow, Wax, Polygon (Layer 2), and more. However, Ethereum accounts for 80% of the NFT market volume via a number of marketplaces (OpenSea, LooksRare, etc). This is an important consideration when you consider that price is primarily decided by volume.
NFT storage and on-chain generation?
The method your NFT is stored and generated can have an impact on its value and success. Your NFT can be on a decentralized blockchain, but if its metadata is maintained off-chain, that portion of the NFT will not benefit from the blockchain’s security.
The actual generation and storage of the NFT can be centralized, which means you must rely on a third party to hold the information. As a result, there may be a single point of failure. If the server does not keep your files, your NFT’s Universal Resource Identifier (URI) will be a dead link.
Also Read: How Blockchain Can Help Stop Cybercrime
The project is known as Art/Utility of the NFT
NFTs have numerous applications. As a result, it’s critical to understand the NFTs, the project’s aim, and the marketplace that will allow you to freely manufacture and sell NFTs. A White Label NFT Marketplace is a trustworthy, pre-integrated marketplace that provides artistic NFTs.
NFTs for artists
The NFT’s functionality is irrelevant if it is solely artistic (conducted by a curator like Art Blocks or Quantum, for instance). You must evaluate the work’s uniqueness, style, and reputation for excellence.
Do you appreciate art? Although this is obviously subjective, make an effort to identify current NFT trends and investor preferences.
NFTs for utilities
Of course, understanding the function of the NFT you are about to purchase is critical. Utility NFTs are more than simply digital trinkets. They bestow advantages, prizes, and privileges to their owners. There are several types of utilities (this is not an exhaustive list):
- Social media profile pictures are images that are uploaded and used to represent one’s online identity.
- The arts and music are a more effective and open way for artists to monetize their work.
- In-Game Assets: Unique assets designed exclusively for use in games.
- NFTs that provide access to a private community. To prove your ownership of the NFT, tools such as Collab. land and Gnosis Safe are commonly used.
- Lands and dwellings found in the metaverse are referred to as virtual worlds.
NFT analysis prior to minting is not an exact science. However, studying the essential symptoms indicated above can help you improve your chances. The quantity of warning signs must be considered; if there are too many, it is often best to pass.
It goes without saying that thorough research and analysis can help you make better decisions. However, experience may be your best bet.