Prospects of investment in NFT for the next few years
Crypto-Upvotes experts conducted their analysis and told about prospects of NFT segment
Throughout 2022, application solutions with NFT have been actively developed in a variety of projects. The audience of the technology continues to grow at a tremendous rate due to the introduction of the technology by social media. This year, some tools related to NFT were implemented by Twitter (audience of about 400 million users), Reddit (audience of about 430 million users), Onlyfans (audience of about 175 million users).Meta (Facebook and Instagram) and Youtube also announced their plans to implement NFT.
Based on these data, we can consider a long-term investment portfolio, taking into account the prospects for the development of NFT
We would suggest dividing the investment portfolio into two parts. The first would be a liquid backbone, the tokens of projects that provide infrastructure for NFT. Polygon blockchain turned out to be the most popular for application solutions. Therefore, as the audience grows, the entire ecosystem could get developed, so the demand for native blockchain tokens would grow accordingly.
Other top blockchains – Ethereum and Binance Smart Chain – may also get a comparable effect from the development of NFT.
Another interesting application of NFT is the Fragment platform from Telegram. It is likely that in the future the supply will expand and the demand for TON will increase.
We suggest forming the second part of the portfolio from specific tokens of various promising NFT tokens. In a growing market, which by all projections should occur in the second half of 2023 and all of 2024. Therefore, collections with high social capital could go up in price several times over.
When to buy ?
Today, terrific conditions for opening long-term positions for at least 1-2 years, better from 3 years or more. The ongoing scandals around centralized exchanges are constantly weighing on the value of the Binance exchange’s native token. And rumors around the potential centralization of Ethereum due to the move to PoS, with validators predominantly in the same jurisdiction, are also negatively affecting the price of ETH in the medium term.
The market as a whole continues to be in a global bearish trend, which opens up the possibility of buying any tokens at undervalued prices.
What is the right investment portfolio structure ?
- Polygon (MATIC) — 20%
- Toncoin (TON) — 20%
- Ethereum (ETH) — 10%
- Binance coin (BNB) — 5%
Another 5% can be allocated under ApeCoin (APE) acting as a native token in the company’s developed meta-universe. The company that owns the world’s most popular NFT-collections Bored Ape Yacht Club, CryptoPunks and Meebits.
The remaining 40% can be distributed among different NFT-collections.
For example, find interesting offers among applied projects from social media, like collections from Reddit or Twitter.
The first part of the investment portfolio is quite conservative by the standards of the crypto market. It lists well-established, reliable projects that have many growth and development factors other than the NFT segment. Therefore, the risks in 3/5 of the portfolio do not exceed the overall risks of the market.
However, the rest are extremely risky investments. You have to consider that NFTs have several orders of magnitude less liquidity. And predicting the value of NFTs in the future does not differ in its essence from flipping a coin for luck. But, with all that, the investment can pay off many times over, given a lucky set of circumstances. For example, one appreciated token can potentially outweigh the value of all the others that will fall. But there is absolutely no guarantee that this will happen to you, to your chosen collection, with tokens owned by you.
That’s why it’s worth investing only as much as you’re willing to lose at least half of that amount.
Crypto-Upvotes experts do not give investment advice, this material is published for introductory purposes only. Cryptocurrency is a volatile asset that can lead to financial losses.