How To Flip NFTs Profit – The Complete Guide
Are you a digital art collector or an NFT enthusiast? Flipping NFTs requires certain strategies, tools and awareness for it to become a profitable venture. Read our comprehensive article and learn some practical strategies on how to flip NFTs for profit!
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Ever since Satoshi Nakamoto released his Bitcoin whitepaper, launching the first cryptocurrency, blockchain technology has appealed to investors first and developers second.
While the latter’s role cannot be underestimated in the technology’s innovation, it is the influx of cash by risk-averse investors that is the growth catalyst for billion-dollar-valued market caps and more.
In this world, nothing goes for nothing. Whether you’re simply buying a crypto dip, HODLing, or contributing to a liquidity pool, the idea is to make a wholesome profit worth more than you put in. That is good business.
NFTs are no different, with many art collectors dipping their hands into their pockets for more reasons than merely aesthetic appreciation. Even the most ardent, art-inclined NFT enthusiasts are looking for ways to turn their hobbies into a means of income.
And that’s where flipping comes into play.
What does flipping NFTs mean?
Today, NFTs have grown beyond digital art. They now include music, tweets and videos. They are usually part of larger collections, such as the Bored Ape Yacht Club, while others are stand-alones owned by individual artists.
Flipping an NFT is akin to buying a cryptocurrency token at a low price and selling it for a profit. With their high demand brought about by an inherently rare nature, you can flip an NFT for a solid profit, provided you use the right strategies.
Like crypto tokens, NFT values rise and fall all the time. For instance, NFT #8348 in the CryptoPunk collection was sold for nearly $500 in 2017. Today that NFT is worth almost $200 million.
Strategies for flipping NFTs for profit
Trading platforms like OpenSea are now becoming highly liquid marketplaces, with NFT trading volumes topping $40 billion on aggregate. You don’t have to be left behind. If you’re an NFT collector or investor, here are the best strategies to help you flip your art for profit:
1) Find Alpha
Alpha in NFT-speak means “intel” or “insider information”. When doing research into NFTs, you should be searching for the most valuable projects. When you find a suitable project, you have to get on board quickly before the project becomes oversaturated, thus reducing your chances of making good profit off of it.
Many projects reward early supporters by granting you whitelist access. This way, you’ll be able to mint the NFTs at a low cost when presale is on or before the mint goes live. If you’re looking alpha, you may want to check out our full list of upcoming NFT projects.
When you’re in early, you’ll have the advantage of a head start over others, and you’ll also be able to list your NFTs on different platforms before the project launches publicly.
2) Buy in a bull market
A bullish market is referred to as an upward trending market instead of a downward trending or bearish one.
You’ll have to monitor market progressions with a keen eye for this strategy. The largest NFT marketplace, OpenSea, is a great place to start. However, it’s not a bad idea to check out the overall market from other platforms and sites. Twitter is also a good place to read the market sentiment. We suggest checking out our list of top 25 NFT influencers to follow.
On the marketplaces, your primary concern will be the charts, looking at the tops of bottoms. You shouldn’t simply buy the top. Just as well, you shouldn’t guess a bottom or top because the trend can go either way- up or down. So, it’s best to wait for confirmation before you decide.
3) Research rarity
When buying NFTs, it’s ideal to start your search by sorting according to rarity. Rarity Tools or Rarity Sniper should be your initial go-to as you dig into the hottest or bestselling projects.
Another way to efficiently sort NFTs is according to their traits. Tokens with the rarest traits are often the most valuable. So, from the marketplace you’re scouring, check out the trait category and look out for sub-100 traits.
Finally, another great strategy involves your swapping ETH for the Wrapped version and make bids on NFTs. This is efficient, as it will save you costly gas fees, leaving you with more funds to invest. It may take a while to get your bid accepted, but with patience comes reward.
4) Buy at the floor
An NFT’s floor price is the lowest priced NFT item in a collection. It’s usually where people start if they just want to get into a project without looking at rarity. It’s also where the most purchases happen in a given NFT project.
As a result, the most liquid NFTs are those whose prices are similar to the floor price. You don’t want to be stuck with an NFT whose value is high but proves impossible to sell.
Most NFT buyers do so with utility in mind, so it stands to reason that they’re more likely to buy the cheaper NFTs.
5) Check the project’s starting price
Whenever an NFT project launches, there is often lots of hype around it due to the marketing activities from the team. Prices tend to soar in the beginning and the team reaps the rewards from their hard work.
If you’re getting into a project which price has already pumped, be warned, as the project might go through a bearish cycle once the hype has ended. When flipping NFTs, you must always be certain that a project has the ability to keep the momentum, otherwise you would be buying at the top and your liquidity will be stuck.
There are many factors to consider to spot a promising NFT project. Strategies for flipping NFTs for profit are different than investing in projects for the long term. You need to follow where the noise is but also watch out for red flags and rug pulls. There are a lot of opportunities but also a lot of dangers.
In summary, flipping NFTs for profit are similar to making money from investing in crypto in many ways. The key thing is to keep your eyes wide open, study the charts, buy low, sell high and remember to take profit every now and then.
Earnings disclaimer: Trading crypto and NFTs is a risky venture. You can make money and you can also potentially lose money. The tips shared in this article is not to be taken as professional financial advice, and we will not be responsible if you lose money! Always do your own research and make investments at your own risk. We will not be liable if you make any losses as a result from trading NFTs or cryptocurrencies