The last year was a golden year for the NFT market since investors from different countries were capitalizing on the trend of owning digital art.
Although the year has gone by, the trend is still in 2022! However, some investors are still skeptical about investing in NFTs.
To help those out, we have come up with this article. So, let’s check whether NFT tokens are a good buy in 2022 or a waste of money.
What are NFTs?
NFTs or Non-Fungible Tokens refer to digital asset that represents real-world asset. Due to their unique identification code, NFTs can easily be distinguished from other assets.
Additionally, one NFT is always different from the other. In this way, it avoids plagiarism. Bitcoin is the most popular example of NFTs.
These days, people are using Bitcoin like crazy, and the demand and use of Bitcoin among all cryptocurrencies are also expanding.
However, besides Bitcoin, you can find more than two hundred equally effective cryptocurrencies worldwide.
Thanks to the non-fungible trait of NFT, these currencies create unique assets that can always be used to signify other assets.
Why are NFTs popular?
Surprisingly, NFTs, despite not having intrinsic values, are popular and widely used throughout 40 countries, like cryptocurrencies.
In reality, the value of NFT is measured by as much as someone is willing to pay for NFT.
Therefore, unlike stocks, the value of NFT can never be determined by anticipating shareholder payout, corporate development, annual profit margin, etc.
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So, if you have found an asset that impresses you and is ready to pay for it, you would always like to opt for that.
But, if the ownership of the asset is tokenized, you must always enjoy the unmatchable advantages that come with NFTs. However, never forget to think about the ambushes of NFTs before finalizing your investment.
Pros and cons of getting your hands on NFTs token in 2022
Everything has its good and bad sides. So, let’s see the pros and cons of NFTs in 2022.
- Ownership: Being unique entities, NFTs do not come with a designated owner. This quality makes NFTs convertible while conserving their ingenuity. On the other hand, based on blockchain technology, NFTs achieve the ultimate transparency level. As a result, the chances of fraud and dishonest activities automatically reduce.
- Immutable: As long as NFT’s legality is approved by blockchain, nothing can change it. Therefore, it is 100% authentic, safe, and secure to use.
- Market place efficiency: NFT provides great marketplace efficiency where artists can sell their products directly to the buyers and earn instant royalties. Also, check out the No deposit bonus codes Australia if you are a casino lover.
- Extraordinary investment portfolio: NFTs, different from traditional assets, contain unique traits. Therefore, if you include NFTs in your investment portfolio, their value will inflate automatically. Additionally, you can expect a better return and risk balance with this asset.
- Smart contract: The backbone of blockchain technology is smart contracts that assure auto-execution in many situations. It is another reason NFTs are the number one choice of many investors.
- Even though it is 2022, and NFTs are highly secured by powerful blockchain technology, fraudsters know the system’s loopholes. So, to can get fraud in this system if you are not careful.
- NFT is a highly energy-consuming technology. The amount of energy one NFT transaction takes equals the energy a household uses per day.
- The NFT market is volatile. It is new, and people still don’t know everything about NFT. The NFT trading sector, being smaller, is not very liquid. However, it will surely change if people keep using this technology in the next couple of years.
So, as you can see, NFTs tokens have too much potential in them and still have so many things to offer and ways to follow.
To the question asked earlier, yes NFTs tokens are certainly a good buy. Although it contains a few drawbacks, the advantages can never be neglected.
So, if you want to try something new and different this year, you will never go wrong with NFT as an investor.