The NFT market exploded in the year 2021. Since then, traders, speculators, and other market watchers have been trying to determine which NFT projects are the most stable and reliable and show the most promise for future growth.
Blue-chip are generally safe, long-term investments with a proven track record. However, the NFT market is still new, and underlying trends are hard to keep up with. NFTs work like any cryptocurrency, but each NFT has a different serial number. If you are considering investing in NFTs, it’s vital to understand what blue-chip NFTs are and why they are important.
Blue Chip NFTs Explained
Blue chip NFTs essentially are NFTs whose value has skyrocketed and thus enjoy the blue-chip status. The term derives its origin from the stock market, where it refers to stocks and other investments known for their financial stability and guarantee of profit. From a foundational perspective, NFTs are similar to other investments.
Several factors are considered for an NFT to be regarded as a blue chip. Aspects like the floor price, brand recognition, the track record of the NFT, celebrity endorsements, and sales volume are critical points to consider. In the case of NFTs, the art, the artist’s reputation, and the artist’s community following are also important considerations.
If you are new to the crypto market and NFT investing game, it’s best to stick to blue chip NFTs. Blue chip companies can be trusted to provide high-standard products that are guaranteed to deliver positive results in the long run.
Why Are Blue Chip NFTs Important?
Traditionally blue chip investments form part of the most reliable indexes and averages and are less volatile. Take Crypto Punks as an example: Crypto Punks, which are an assortment of 24*24 pixelated avatars, is an NFT on the Ethereum blockchain which hosts several digital arts and other collectibles. There are only 10000 Crypto Punks in both V1 and V2 contracts, and their exclusivity adds to their value.
The Bored Ape Yacht Club is another blue-chip NFT with a unique collection of 10000 Bored Ape tokens. Cool Cats and Doodles are other popular examples. These blue chip NFTs are important for several reasons such as the following:
While NFTs are popular, they are also risky. The risk of getting scammed is higher in the NFT market. Blue chip NFTs ensure investment safety to a good extent. This is because blue chip NFTs are usually launched by reputed brands and artists. However, it’s critical to consider the content, which is the actual artwork of the NFT, before investing in it.
Record of Growth and High Income
The higher the floor price of the NFT, the more valuable it becomes. The value of art stored in blue chip NFTs will increase over time. This value is typically measured by studying the demand and auction values over time.
NFTs carry more risk than their underlying cryptocurrencies. This is especially true over a long time frame. Each NFT is unique, and the prices can vary dramatically. Investing in blue chip NFTs is therefore the safest approach to being successful in NFT investing and trading.