Home Business News The pros and cons of using NFTs

The pros and cons of using NFTs

by Alex Hayes
28th May 21 10:46 am

I’ll be honest, I never thought that something like virtual collectibles would become such a huge market. Non-fungible token’s (NFTs) have allowed virtual collectibles to exist by immortalizing moments, videos, pictures, songs, art, etc. Anything you can think of, you can turn it into an NFT.

However, before you jump into the NFT train, we recommend you read this article. We are going to analyze the pros and cons, and of course, if it’s better to invest in NFTs than it’s to purchase bitcoin. Let’s start!

The Pros of NFTs

It’s easy to be attracted to NFTs after you read stories like this. Making $69 million overnight will easily spark interest in everyone, and it’s because the current NFT narrative can be wildly profitable. And this is a pro to get involved.

However, we don’t recommend buying NFTs available in the marketplace. Once the NFT narrative starts to wind down, you might end up holding a heavy bag of NFTs that probably none will ever purchase.

The solution? You need to get into sales such as NBA Topshot, UFC’s, Campcom’s, etc. This is where your investment can grow exponentially without much risk because these   NFT packs are very affordable $9-15 – the price varies too.

For creators, NFTs are a great way to get exposure to the current narrative, and hence, get more money for their talent. As long as you have something unique to offer, you can turn it into an NFT and sell it on marketplaces such as SOUL, OCEANS, WAX, etc.

You can even turn already existing pieces in NFTs or the ones that you didn’t manage/decide to publish, and it could become an excellent profit since you will be riding the narrative that’s still pumping.

Furthermore, NFTs allow artists to protect their work. By using blockchain technology, it’s impossible to corrupt the original creator, ownership or provenance. Therefore, it’s an excellent to fight back piracy, allowing the creators and collectionists to make their NFTs more valuable.

As you can see, NFTs have very important pros because they’re one of the most popular and powerful narratives in the crypto space as of now. Hence, you can ride it as an investor or creator. It’s up to you, but the opportunities for winning plenty of money are out there… but before you jump in the train, let’s talk about the cons.

The Cons of NFTs

NFTs are great and shining, but they also come with cons. From an investor perspective, they can be highly risky, especially if you venture into buying NFTs from marketplaces with the intention to resell them. Even though this can prove to be successful, in the majority of cases, it will not happen especially when the narrative winds down.

Hence, the first con of NFTs is that it can be a very risky investment if you don’t do your own diligence before putting your money into them. This is the case for newbies in the cryptocurrency space, especially after reading articles like this one.

While it’s true that it’s booming and we believe that NFTs have a real use case, it’s mostly being fed with hype, and as well know, it never ends up good for a lot of investors that didn’t take the appropriate preventive measures. It’s the same effect that happens when new investors see rising cryptocurrency prices they feel the need to get in before they miss the rocket, only to see it dump afterward.

Even though NFTs make it possible to protect the provenance, ownership, and authorship of art, it’s also true that it can be used for art theft. For example, someone could simply take someone else’s artwork that’s not been published online and turn it into an NFT. And that’s a latent danger in the art industry.

Finally, the new platforms for NFTs still need to work on solving the major issues such as processing times and fees. ETH has already proven to be lackluster in this aspect, but the most promising solutions such as PHANTASMA have already addressed this and are solving this in order to make the business of NFT free from expensive fees and much faster.

Conclusion

NFTs have important pros and cons, and before you get involved in this business, you need to evaluate them. Be it as an investor or creator, do your own due diligence because it will protect your capital and investment.

What do you think about NFTs? Do you think they will keep up this current narrative for the next 3-5 years? Have you already purchased NFTs? Let us know it all in the comments!

If you have questions, let us know as well. We are here to talk and help whenever we can do it!

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