For all you savvy HODLers, you already know that 2021 was the year of the non-fungible tokens, or “NFTs.” Starting with a humble market cap of $100 million in 2020, NFTs practically broke the cryptoverse after reaching a total value of over $22 billion by the end of 2021.
This burgeoning market posted a breezy 5,400% growth in one year — and still offers a huge opportunity for everyone and their grandmas to make money in NFTs. In this article, we’ll break down the driving factors behind the rapid growth of NFTs, why they’re here to stay, and how you can score some serious moolah off their rise.
Why Are NFTs Such a Big Deal?
Digital Ownership: More Than Just a Fad
Non-Fungible Token, or ‘NFT,’ is a fancy term for a unique, indivisible digital asset that can be bought and sold using blockchain technology. They can only have one owner at a time, cannot be replicated, and, because their exchange is recorded on distributed ledgers, they offer a transparent historical record of ownership. Therefore, the true value of NFTs lies in their ability to provide verifiable digital ownership.
Their use is widespread. Content creators, artists, musicians, and more have stumbled across enormous riches with the internetization of the art and entertainment industries. That said, anyone who recognizes the names of Kazaa, Limewire, Bittorrent, or others also instantly understands how easily digital files can be stolen, shared, or plagiarized. However, an NFT ecosystem which enables truly unique ownership of art, music, or other digital media creates scarcity — which in turn creates value. That value has emerged in the rapid growth of the NFT industry and has been seen through booming transaction volumes.
Market Opportunity: A New Outlet for Investment
At the heart of NFTs’ unparalleled growth are high-profile purchases, like Beeple’s Everydays: the First 5000 Days, the world’s most expensive NFT to date which sold for an eye-watering $69 million. Another Beeple, Human One, sold for $29 million. Axie Infinity, the blockchain-based play-to-earn game, sold $89.83 million worth of NFTs in one week. Then, there was the Bored Ape Yacht Club, a famous collection of 10,000 NFTs, which sold a bundle of 101 NFTs for $24.4 million.
In addition to the major headliners, moves by large corporations and influencers within tech, sports, arts, and entertainment, such as Coca-Cola, Logan Paul, Post Malone, Gucci, Nike, among others, spurred growth within the NFT ecosystem. For example, former Twitter CEO Jack Dorsey turned his first tweet into an NFT and auctioned it off for $2,500,000. Corporate and influencer adoption has been pivotal to generating hype around NFTs.
However, NFT popularization has not solely been driven by extravagant splurges and influencers; in fact, NFTs have been quickly adopted by the broader crypto community and seen huge transaction volumes. OpenSea, a leading NFT marketplace, saw $483.62 million in weekly NFT sales in December 2021, closing the year with approximately $13 billion in total sales. More recently, Looksrare’s NFT market smashed OpenSea’s 24-hour sales with a transaction volume of $385 million on January 12, 2022.
These sky-high numbers have piqued interest around the globe in the growth potential of NFTs. Google Trends data confirms that interest in NFTs has skyrocketed over the last several months, as global search interest for ‘NFT’ surpassed that of ‘Crypto’ for the first time in late 2021.
5 Ways to Join the NFT Revolution
NFTs have generated tremendous wealth for early adopters. In fact, NFTs have minted billionaires, such as OpenSea’s founders. But you don’t need to be knee-deep into tech to start making money from these digital assets. Let’s take a look at some of the battle-tested ways to join the NFT revolution like the big boys.
NFT Minting
Minting your own collection is an excellent way to start making money from NFTs. You can do so by turning your valuable digital media such as photos, sports cards, tweets, music and even memes into NFTs, which can be done through popular marketplaces like OpenSea.
As is the case with digital collectibles, the unique selling point for your media-as-a-token is tied to the rarity of your NFTs, as well as the general attractiveness of your product to the general audience. You don’t even need to know how to mint your art into an NFT yourself as there are loads of online resources or, easier still, freelancers for hire to do the heavy lifting for you.
NFT Royalties
Royalties are a unique selling point for NFTs, particularly for artists, musicians, or content creators. Since NFTs make it possible for original creators to set the terms of sale, they can assign royalty fees to be generated whenever their NFT changes hands within secondary markets. This would allow creators to receive passive income indefinitely from in-demand NFTs for little-to-no additional effort.
NFT Flipping
‘Buy low, sell high’ has always been the language of the market. The NFT market is no different, and NFT flipping has created enormous wealth for astute investors. NFTs cannot be exchanged for another outright, but they can generate income through the buying and reselling to higher bidders through an NFT marketplace. This hustle has proven quite lucrative for many, though it is not without risk — after all, beauty is in the eyes of the beholder and a flipper could end up spending big bucks on NFTs that others do not find valuable. Therefore, it’s important to do your own research and acquire an understanding of the drivers behind highly demanded NFTs before investing your life savings.
NFT Lending
With more than 50% of all cryptocurrency wallets plugged into GameFi dApps, play-to-earn video games could well be the future of NFTs. In GameFi, NFTs are used to represent in-game avatars, lands, gear, and other items, and these assets help gamers complete tasks and earn income. However, gamers can often find themselves with more NFTs on-hand than they need. Unfortunately, given the industry is still in its infancy, these NFTs are extremely difficult to transfer across different blockchains and often sit idly by.
Kyoko.Finance’s cross-chain asset lending platform offers guilds and players a fantastic opportunity to make money by renting out their idle in-game NFT assets to other players. In this exchange, lenders rent their NFT to gamers who then transfer back the NFT with interest at the end of the lending period. Lenders set the terms of the rental arrangement, and the Kyoko marketplace will allow interested borrowers to pick up the offer. It’s a win-win; new players are able to rent out in-game assets and join new games for lower cost while lenders can generate income from their idle assets.
NFT Staking
Staking requires locking up assets on DeFi or GameFi platforms to receive rewards — similar to how traditional banking certificate of deposits (CDs) work. Your NFTs remain in your ownership and are redeemable once the lock-up period is over. Rewards are based on the total value locked (“TVL”) in a ‘liquidity pool’ as well as a publicized percentage yield. Staking therefore offers an opportunity to earn passive income from your NFTs over a longer time period.
A Peek into The Future of NFTs
Admittedly, many industry onlookers are still trying to grasp the opportunities that the NFT revolution brings. Many skeptics fail to see the value behind these “.jpegs.” However, the early adopters, those that have seen the true value in NFTs, have earned big bucks through the strategies above.
It’s not too late. As the industry continues to mature, you too can find ample opportunities to earn with NFTs. From art to gaming — and the many industries in between — the use cases for NFTs are widespread and will lead to massive market opportunities for any and all willing to believe.
About Kyoko
Kyoko.Finance is a DAO-to-DAO and cross-chain GameFi NFT lending market for guilds and players. Kyoko’s DAO-to-DAO lending offers liquidity to promote web3 development, while its guild-to-guild lending, P2P NFT lending, and cross-chain asset lending platforms aim to solve the most pressing issues challenging the GameFi market, including the rising cost of entry and siloed in-game assets across different blockchains. Kyoko’s metaverse will also allow Guilds to display their history, progress, and other accomplishments, while players can connect with others in a world that can be built in, developed, and sold off.
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