In our recent article on researching TON projects and their tokens, we provided a checklist for evaluating tokens based on public metrics. Now, we’ll continue our DYOR series by explaining how to assess NFT collections and select valuable NFTs, with insights from our partners.
What Are NFTs and Why Do They Have Value?
NFTs (non-fungible tokens) are unique digital assets stored on a blockchain. Each NFT has a distinct ID and contract or creator’s address, making it easy to track its history, verify authenticity, and detect counterfeits.
NFTs often include digital content, such as images or GIFs, but they can also offer utility or combine both. They’re typically created as part of collections, where all tokens share the same contract address but differ by unique IDs. For example, the “Bored Ape” collection has 10,000 NFTs, with each token being individually identifiable, like Bored Ape #8817.
Bored Ape #8817, for instance, is valued at 17.5 ETH (about $56,000). Its value is driven by factors such as:
- Rarity: Only 10,000 tokens exist.
- Branding: Bored Apes are a recognized Web3 brand.
- Popularity: They’ve been bought by celebrities like Eminem and Madonna and showcased at high-profile events like Sotheby’s auctions.
Like any branded product, hype and fame largely dictate an NFT’s value.
What Makes NFTs a Complex Investment?
Unlike fungible tokens like $TON, where all units have the same value, NFTs are priced individually based on rarity and demand. Trading NFTs is more like trading cars—factors like rarity, appearance, and special features influence their value.
Additionally, NFTs are indivisible. You must purchase the entire token, not a fraction of it.
Before buying an NFT, decide your purpose:
If it’s for personal enjoyment (e.g., artwork or profile pictures), choose one that appeals to you.
If it’s for investment, follow this quick DYOR checklist:
- Research the artist and community.
- Check floor price, trading volumes, and trends.
- Evaluate the project’s utility and roadmap.
NFTs Are About the Artist First
A famous artist’s mediocre work often has more value than a masterpiece by someone unknown. Research the creator—whether they’re an individual, a team, or an organization.
“Check what the artist has done before. If they’ve successfully launched NFT projects in the past, it’s a good sign,” — Asterrvn, Crypto-Digital Artist.
Artists who care about their reputation and community tend to deliver better long-term results. Conversely, celebrity-endorsed NFTs often fade after the initial hype. For example, Snoop Dogg’s NFTs recently saw under $700 in total trading volume despite his fame.
The best bets are:
- Established Web2 artists transitioning to Web3 with active communities.
- Projects that combine art with utility, like Web3 games or dApps.
- Tokenized assets like Telegram usernames, which offer clear utility.
“Be cautious of copycats. Some bad actors steal art and try to resell it on other chains,” — Igor Fox, CEO of TON Spiders Ecosystem.
The Floor Price Is Key for Flipping
Flipping involves quickly buying and selling NFTs for profit. The floor price, or the lowest price of an NFT in a collection, is essential. A low floor price can indicate a potential bargain, especially if volumes are healthy and the token is listed below the second-cheapest option.
“If volumes are low—just 1–5 sales per month—you might freeze your money by buying the NFT as finding a buyer will be difficult,” — Igor Fox.
To gauge hype, check the collection’s community. For trading interest, explore the marketplace’s stats or history section.
Utility Drives Long-Term Value
For long-term investment, examine the project’s roadmap and the utility of its NFTs.
“Evaluate how profitable or useful the NFT’s utility is. Strong utility often translates to better valuation and prospects.”
For example, Telegram usernames and Anonymous Numbers are NFTs with clear utility that may appreciate as the TON ecosystem grows. Similarly, projects like Pokraslampas NFTs, which offer rewards for holders, show promise. In contrast, collections without utility or creator dedication are more likely to lose value.
Check Trends for Opportunities
Use marketplace stats to analyze daily trading volume, average prices, and total sales. Look for collections with increasing metrics. If activity is declining, it may be too late to invest.
Let’s Analyze a Random NFT Collection
We reviewed the Rich Cats collection on GetGems. It’s one of the oldest TON NFT collections, with backing from TON Foundation President Steve Yun.
- Artist: Anonymous.
- Community: Active Telegram group with 3,700 members and ~100 reactions per post.
- Utility: Promised prizes and partnerships, e.g., with DAOLama NFT lending service.
- Floor price: 85 $TON (~$570). 190 NFTs are listed for sale, while 2,300 are held. Recent sales exceeded 100 $TON each.
Verdict: A solid collection, but its high floor price may be unsuitable for newcomers.
Now, let’s examine a more affordable project: NOT Wise Eggs.
- Artist: Anonymous.
- Community: 5,200 Telegram members with ~100 reactions per post.
- Utility: Mysterious timer on their website, hinting at future developments.
- Floor price: 2 $TON (~$13). 10,000 NFTs exist, with only 436 listed for sale. Trading activity is high, with hundreds of daily sales at an average price of 4.5 $TON.
Verdict: A good entry point for beginners interested in flipping.
Finally, here’s an example of a bad NFT collection: Enotius.
- Art: Mediocre AI-generated images.
- Stats: Floor price of 12 $TON, but only one sale at 0.1 $TON.
- Community: Nonexistent.
- Verdict: Avoid this collection.
Conclusion
Start your NFT DYOR by checking the floor price. For beginners, focus on affordable NFTs and only invest what you can afford to lose.
Demand drives value, so assess community activity and the project’s development plans. Study trading history and trends to identify opportunities.
Remember, this analysis is for educational purposes only. We’re not affiliated with the mentioned collections, nor do we recommend purchasing them.
Always do your own research before investing!