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NFT advanced gameplay

NFT represents the future of digital content. They are on-chain, programmable, tradable, and permission-free DIY media Lego blocks designed for the digital age.

These blank digital canvases have changed the rules of the game for creators from all walks of life. But talking and staring at them is one thing, and starting to try to expose NFTs directly in your portfolio is another. So where do you start?

This is where many people find themselves lately, whether they are newbies or veterans of encryption. No matter which industry you come from, your game will not be ashamed: everyone is now in the same boat, trying to capture NFT and its potential, from small artists to large institutions.

So how do people start to occupy promising positions in the booming NFT economy?

This is a question that is as pertinent as ever, look at billionaires like Mark Cuban and Chamath PalihapitiyaHow investors are currently heading into NFT. Do you want to be late for this once-in-a-lifetime cultural party?

This strategy will show you how to build your NFT portfolio in a variety of ways, including buying NFT directly, buying NFT platform tokens, or buying NFT index fund tokens.

Of course, you must research it yourself!Goal: Get NFT risk in your crypto portfolio

Skills: Simple/Intermediate.

Effort: Start in 15-30 minutes.

Return on investment: As the NFT market continues to become mainstream, this may be important if you have been using NFTs for many years.

How to enter the world of NFT

There are multiple ways to access NFT, so fortunately, you have multiple options. Ultimately, it is up to you to decide which method (if any) is right for your investment portfolio.

A simple starting point is to buy NFTs in your price range from projects and creators that you find attractive. You will keep these NFTs in the same way as you manage ERC-20 tokens, such as through APP wallets or browser wallets (such as Math Wallet).But there are other interesting ways to take advantage of the NFT ecosystem.

I will break down all your main options here so that you can start designing your personal NFT strategy.

Own NFT directly

Ethereum already has multiple general NFT markets, such as OpenSea and Rarible, which aggregate NFTs from the entire ecosystem, allowing users to purchase various NFTs through a single, user-friendly dashboard.

Source: opensea.io

In addition, there are specialized NFT markets, such as SuperRare and Nifty Gateway, which specialize in encryption art NFT as the center.

Of course, you can use both platforms, but before you do anything, you need to set aside some ETH to buy and/or bid for NFTs.

Markets such as OpenSea allow buying and selling in multiple tokens, but ETH is usually the primary currency of choice. You also need an encrypted wallet so you can directly interact with smart contracts in the NFT market.

Source: superare.co/discover

Once you have your cryptocurrency and wallet ready, you can go shopping. Go to the market of your choice and connect your wallet, and you can start collecting.

Make a budget and look for NFTs within the price range. You may not be able to afford all the cool NFTs that attract your attention, but there are definitely NFTs provided by creators of various prices and backgrounds.

Of course, the way to construct the NFT collection is not necessarily correct or wrong. Just be aware that NFTs are non-current assets and you cannot guarantee the recovery of the ETH you spend. Remember: Value is subjective-everything is in the eyes of the beholder!

There is no shortage of opportunities to take advantage of NFTs or market inefficiencies.

However, your safest way is to buy an NFT that you personally think is very cool or unique and that you don’t mind owning for many years. The potential benefit is that others may eventually find that your NFT is also cool and provide a profitable offer at some point in the future.

NFT-based ERC20 token

Ethereum ERC20 tokens can be used to tokenize or represent anything, so it is natural for us to see these tokens deployed in a series of tool use cases in the NFT ecosystem.For example, governance tokens like Rarible's RARI or Axie Infinity's AXS. These projects focus on NFTs, so they are likely to benefit from the prosperity of NFTs.

These tokens allow holders to manage these projects from the bottom up and co-own them as a community, instead of being company-owned, top-down and extractive.

If these NFT projects start to grow substantially from here, the demand for their governance tokens should increase accordingly. Purchasing these tokens on DEXs such as Uniswap is a way to access the NFT ecosystem, although these specific assets can also be obtained through ecosystem participation (for example, buying and selling on Rarible or playing Axie infinity regularly).

Source: axie.substack.com

Next, there are utility tokens, such as Meme Protocol's MEME and Sandbox game platform's SAND token. By utility tokens, I mean that these assets provide their holders with advantages or utilities that they cannot obtain without holding them.

For example, Meme Protocol is an NFT agricultural project that requires users to pledge MEME to participate in its iconic NFT drop, and SAND tokens are the local currency used to pay for the in-game experience in The Sandbox world.

These assets can capture the growing demand for these NFT projects, so they are another avenue to consider.The last type of NFT-centric ERC-20 to be considered is partial ownership tokens, such as NIFTEX's shard NFT or Metapurse's B20 token.

For in-depth understanding, NIFTEX is a platform that allows users to subdivide their NFTs into easily tradable and liquid ERC-20 tokens. Therefore, in terms of collective ownership of NFTs, NIFTEX is a very promising approach. It already has about 20 NFT shard markets to choose from.

Metapurse's B20 token also adopted a similar idea because the group split the ownership of the Beeple 20 series of artworks. With Beeple's upcoming Christie's auction, this may be a unique way to understand his work and the potential benefits that the auction may bring.

If you believe that the value of the underlying NFT will rise, then these partial ownership tokens are an easy way to obtain the associated risks.

Lending cryptocurrency to NFT users

More and more NFT holders are interested in using NFT to borrow cryptocurrency on platforms such as NFTfi, which is an NFT mortgage loan platform.Takeaway? You can lend crypto peer-to-peer to people who use NFT as collateral and earn interest on it. If the borrower defaults, you will be rewarded with the underlying NFT collateral.

Source: nftfi.com/app/le

If this sounds like an NFT x DeFi intersection that interests you, navigate to NFTfi’s Lending dashboard, connect to your browser wallet, and provide loans based on any of the listed NFT collateral proposals you like.

Buy NFT index funds

Finally, we are beginning to see the rise of NFT index funds, which track a basket of similar NFTs.One of the pioneers here is NFTX, which focuses on building index funds that track the reserve prices of specific NFT categories (such as Zombie CryptoPunks or Origin Axies).

In other words, if you want to have easy and liquid access to Zombie CryptoPunks in your portfolio, you can purchase a small portion of PUNK-ZOMBIE tokens, and the same is true for Origin-AXIE for Origin Axies.

These NFTX index funds currently have the most liquidity on Sushiswap, and the initial funds that can be used for trading include:

  • PUNK-BASIC (tracking the base price of CryptoPunks)

  • PUNK-FEMALE (tracking the reserve price of female cryptopunk)

  • PUNK-ZOMBIE (tracking the floor of Zombie CryptoPunks)

  • PUNK-ATTR-4 (use 4 attributes to track the base price of CryptoPunks)

  • PUNK-ATTR-5 (using 5 attributes to track the base price of CryptoPunks)

  • PUNK (an index fund composed of various CryptoPunks indices of NFTX)

Conclusion

The NFT economy is heating up in an unprecedented way. People are realizing the potential of these assets. Therefore, any savvy cryptocurrency investor should consider how to take advantage of the current boom.

There are many ways to get exposure. You can invest directly in NFTs, get NFT-centric ERC-20 or NFT index funds, and even lend cryptocurrencies to borrowers who want to use NFTs as collateral. But it is not without risk!

Always be cautious when investing in new assets, and deal with your personal NFT strategy through extensive due diligence and risk considerations.

The more thoughts you put into the collection work, the better your chances of building a strong NFT portfolio!

Action steps

  • Try to buy NFT on OpenSea, Rarible, SuperRare or NiftyGateway

  • Trade NFT-based tokens on Uniswap or Sushiswap

  • Investigate NFT lending platforms, such as NFTfi