18 Do's and Don'ts When Making Money With NFTs.

Making money with NFTs has become a lucrative business for many people around the world. That’s not to say that you can become a millionaire overnight, however, if you understand the do’s and don’ts when dealing with NFTs, your odds of success increase substantially.

I have sold a few NFTs from my own collection for a good profit and I have also lost money on some bad buys. That’s why I thought it would be a good idea to share some things I’ve learned about making money with NFTs.

Here are some absolute Do’s and Don’ts when you’re attempting to make money via non-fungible tokens.

Making Money With NFTs Do’s.	Making Money With NFTs Don’ts.
Do purchase things you truly enjoy.	Don’t buy because of the hype.
Do your research on every NFT you buy.	Don’t purchase things you don’t support.
Do buy at the floor price.	Don’t buy if you believe prices are at their peak.
Do sell your NFT for a profit.	Don’t sell below your purchase price.
Do re-invest your profit (flipping).	Don’t spend your profit on things that don’t generate more income.
Do collect certain NFTs with the intention of holding long-term.	Don’t sell your NFT too early.
Do get involved with the NFT community. Ask questions and share your thoughts.	Don’t be greedy.
Do create NFTs with value and utility.	Don’t create NFTs with the sole intention of making a quick dollar.
Do take your wallet security seriously.	Don’t give out your password or secret phrase. EVER.

I’ll be the first person to tell you that investing money in NFTs is a huge risk!

That being said, the more you practice and interact with the market the more knowledge you can attain. Ultimately, the outcome could be very rewarding.

So, what are the do’s when trying to make money with NFTs?

Making Money With NFTs Do’s.

1. Purchase things you truly enjoy.

The most important thing when learning to make money with NFTs is to invest in assets you genuinely like and want to support. Generally, if you invest your time into something you actually enjoy, then your’re more likely to reach success.

Moreover, buying an NFT that interests you actually sets you up to win regardless of the situation you find yourself in. If your token ends up being worthless from a monetary value, at least you are left with something you appreciate on a personal level.

Likewise, if your NFT ends up being worth a fortune then you can sell it for a profit.

2. Do your research on every NFT you buy.

Ensuring you do proper research on every NFT project you are considering purchasing is extremely important when trying to make money. Doing extensive research increases your odds of buying a token where you may receive a return on investment (ROI). There are many aspects of an NFT project that require an adequate amount of research before making a final decision.

Here are some of the top things you should look into before splurging on a digital token:

Creator’s social status.
Brand name/intellectual property.
Community.
Smart contract terms (perks, term dates, and restrictions).
Past projects, failures, and accomplishments.

Famous entrepreneur, and now perhaps cryptopreneur—Gary Vaynerchuck, recommends a minimum of 50 hours worth of research before deciding to go all-in on a new project. This ensures that you will be able to make the most educated decision and intuitively come to a conclusion on your potential purchase.

Additionally, there is a lot that goes into finding a good NFT that will also make you money. You should really know what to look for in a good non-fungible token before buying one of your own, that’s why I break it all down for you in “Finding Good NFTs: A Collector’s Buying Guide.”

3. Buy at floor price.

Assuming you are buying into a new project drop (release), it’s always a good rule of thumb to try and buy your way in at floor price. Whether it’s a dutch auction (price decreases over a specific period of time), or a set minting price, always try to purchase at the floor price.

The reason you want to purchase at floor price is that more than likely, the floor price is set to be the minimum selling price. If you did your research and got in on a good NFT, you have a better chance of making a profit assuming the floor price will steadily rise eventually. But remember, nothing is guaranteed.

I have experienced NFT drops that were at a set minting price and then resold on the secondary marketplace for under-floor price. It really depends on how quickly the creators behind the project are bringing additional utilities on board while continuing to build an active community.

Buying at floor price is usually your best option when it comes to purchasing price for a non-fungible token.

4. Sell your NFT for a profit.

Obviously, if you buy an NFT with the intent to resell it then you need to be selling them for a profit. Selling your tokens for a profit will allow you to reap more funds, hence more NFTs. This is known as flipping up. Flipping up is a good way to earn enough money to afford your next big find.

Here are some things to keep in mind when selling your NFT for a profit.

Aside from the purchase price, there are also transaction fees you will need to pay to transact on the blockchain. These fees can range anywhere from 0.50 up to $50 or more for a single transaction This means the fees may eat into your overall profit. Stay aware of any additional fees when buying your token.
Trying to resell your NFT at the right time can prove to be difficult, but at the end of the day the choice is yours. Just remember, if you choose to sell on a value increase, you will always win. At the same time, you could sell too soon and miss out on even greater profit.
If you want to start flipping NFTs, I suggest you start with an inexpensive NFT and flip up at a rate of 2x from your purchase price. This allows you to get the hang of buying and selling—resulting in a positive ROI.

In my humble opinion, the most important thing about selling your NFT for a profit is that you learn to enjoy the process. The process of doing the research, buying at the floor price, selling for a profit, and even taking a loss sometimes. The more you practice your trade, the greater your intuition will be.

5. Re-invest your profit (flipping).

One of the best things you can do for yourself and your community is make sure to re-invest in your brand. The money you earn from selling your non-fungibles for a profit should be reinvested into buying more NFTs and building your own brand. Flipping is one of the quickest ways to earn money in the NFT space. Buy low, sell high.

Keep in mind, when you’re flipping your tokens you don’t always need to sell them for a huge profit, that’s simply not doable. Some NFTs hold value better than others and vice versa, so if you end up with a small profit you still come out a winner.

6. Collect NFTs with the intention of holding long-term.

You can’t call yourself a true NFT collector if you don’t have at least a couple of these non-fungible assets in safe storage for the long term.

The type of non-fungible tokens I find with the intention of holding for a long period of time are usually the ones I do the most research on. If the NFT you buy is attached to a strong brand, then you may want to consider it as a collectible which could have value to someone in the future.

A good brand, growing community, and ambition are clear signs of a potential collectible digital asset. In addition, NFTs and people in general, who tend to do something significant or unique first can have an everlasting spot in the elite collectibility category.

Some examples of these O.G. projects on the Ethereum blockchain are Curio Cards, Cryptokitties, and of course CryptoPunks. These projects have essentially been grandfathered into a spot of rarity and desirability, causing a supply and demand spike which ultimately can spike the value.

Buying a superb non-fungible token and then holding onto it for years when you have offers can be challenging, I understand. But if you’re patient, your collectible NFT could make you some big money in the future.

7. Get involved with the NFT community. Ask questions and share your thoughts.

Engaging yourself in the community is absolutely necessary if you want to make any money with NFTs. If you don’t understand the market, it could be difficult to make the right decision. That’s the best part about being an active member of your community.

Your community is your support group. If you have a question that needs to be answered, bring them to the community. Likewise, if you are knowledgeable in a specific area that may benefit the community, share it. You’ll find that interacting with the community more often will spark new ideas and new friendships.

Getting your hands dirty is part of the game, get used to it.

8. Create NFTs with value and utility.

As an NFT creator, it’s important to ask yourself why you are creating the tokens you make. What is that you are offering to your audience and how do they react to your work? If you can create a product that offers both value and utility, you just may be able to make an income creating and selling digital assets.

Through my exploration of NFT hunting, I have uncovered many tokens with amazing value and utility such as:

VIP access
Conferences
Monthly calls and interviews
Merch
Collaboration Deals
Moble apps
Liquidity pool
Metaverse lots and housing
Metaverse accessories
Courses/classes

This list is only a small compilation of examples that can add value to your non-fungible token. The more creative you can get, the better in my opinion.

9. Take your wallet security serious.

Wallet security should be a high priority for you, especially if you are building up a portfolio of digital assets. There are a lot of different ways you can store your NFTs and cryptocurrency. The best place to store your precious tokens is in an offline hardware wallet. These cold storage wallets implement increased security measures via a PIN code in addition to a secret 24-word phrase only you will know. When you’re not using your wallet, it remains offline ensuring all your valuables are locked away.

I’ve provided a more in-depth look at how to store your NFTs safely here: Securely Storing Your NFTs: A Complete Guide.

Making Money With NFTs Don’ts.

1. Don’t buy just because of hype.

Buying into an NFT just because of the hype surrounding it is not the best idea. You should always do your own research. If there is the hype surrounding an NFT, make sure you understand where that excitement is stemming from. It may be stemming from a good utility and community growth, or perhaps the source is something not as true.

Be on high alert when you notice a project’s value is rising. This could be a sign that whales, aka high rollers—are buying up these non-fungible tokens in the masses, and them reselling for a quick profit. I like to call this technique the “pump and dump”.

I can’t reiterate this enough, do your own research before buying any digital assets such as NFTs.

2. Don’t purchase things you don’t support.

If you don’t want to support an NFT and the associated brand, don’t buy it. Support is massive when it comes to building a brand, especially in the digital community. Really, this all leads back to only purchasing what you truly enjoy. It can be art, games, avatars, clothing, literally anything! It’s up to you to be self-aware and only buy what you find valuable.

3. Don’t buy if you believe prices are at their peak.

Purchasing anything at ceiling price is not the best use of your money. You’d rather buy something on sale over something that is the original price, right? The same goes for when you’re shopping for NFTs. Buying a digital asset when it is at its peak price is okay if you really admire the brand and the product being offered. Otherwise, wait until you can get it for a cheaper price.

Also, some NFTs that hit a climax can still rise even higher if the brand is doing well. Ultimately, the market decides the value.

4. Don’t sell below your purchase price.

Trying to sell your NFT? Avoid selling it at or below the purchase price. If you sell your asset for less than you purchased it for you are taking a loss. Depending on how much you have invested, this could be detrimental to your savings account. In addition, take into consideration any transaction fees you may have paid when originally receiving your NFT.

Always do your best to sell your NFT for more than what you paid to get it. This will allow you to save up enough currency to invest in your next digital asset.

This potential scenario is very real, but it is avoidable. The best way to avoid losing value on an NFT and potentially your money is to ensure you only invest in things you truly love and have done your own research on. If you are fond of the brand, then you won’t mind if it’s not as valuable in the future.

5. Don’t spend your profit on things that don’t generate more income.

Spending your profit on stuff you don’t need will not generate more cash in your stash. In fact, it will do the exact opposite of that.

If you have gotten to the point where you are earning a profit on your non-fungible token, you should always reinvest that money if your goal is to acquire more income. Investing your money into new digital assets may be a good gig if you feel comfortable enough with your current experience.

If you don’t want to reinvest your earnings right away, save your money until you find a project you are really passionate about and have done your research on.

6. Don’t sell your NFT too early.

Letting go of your non-fungible token can be quite tempting when you have a fair offer on it, however, that doesn’t mean it’s time to sell. It’s not uncommon for an NFT to go through various stages on monetary value, especially if the brand is in its early stages of development. Make sure you feel comfortable selling for the price being offered.

If you personally find that the value of your NFT is worth more than what’s being advertised, don’t sell it. Only sell your token if you are sure that the offer is at least equal to or more than what you have determined is the value for yourself.

A good idea when selling your NFT is to decide on a ‘set price’ you are willing to sell it for. That way, you know regardless of whether you sell or not, you’ll be happy.

7. Don’t be greedy.

Alright, so maybe you have found out how to make money with NFTs. But that doesn’t mean you should have all the money.

Being greedy with your intentions and NFT purchasing habits can put you in a bad spot. Spammers love to target greedy collectors who will bite at a deal that’s always too good to be true. Greed can lead to making unjust decisions and feeling upset when you lose out on all your hard-earned currency due to a deal gone wrong.

A good way to avoid being greedy is to do your research and ALWAYS invest your money back into supporting the community and helping others. They will appreciate it and you’ll feel good too.

8. Don’t create NFTs with the sole intention of making a quick dollar.

If you are an ambitious NFT creator, the biggest mistake you can make is creating non-fungible tokens for the wrong reason. Making NFTs only to gain a quick profit is the fastest way to end your chance at a career as a creator. People are smart and will always sniff out a cash grab.

Instead, produce a non-fungible token that you want to, don’t worry about what others are doing. As well, make sure to provide value and utility for your consumers and always give more than you take. This ensures the end consumer is satisfied and loyal to your brand.

Once you have gathered a community that loves and respects the brand you are building, you are destined to grow the community thanks to word-of-mouth in addition to a solid reputation.

9. Don’t give out your wallet password or secret phrase. EVER.

When giving out any of your personal information—especially when it comes to your crypto-wallet—you need to be extremely cautious. Never give out your secret phrase or password regardless of the situation. If anyone ever reaches out to you and requests your secret info in trade for currency or assets, avoid them at all costs—this screams SCAM.

Handing over any of your wallet info (with the exception of your wallet’s public address) puts you and your assets at extreme risk. This is comparable to giving out your social security number or your bank account info, it’s something you should never do.

It’s important to take your wallet security seriously. Otherwise, kiss all your digital collectibles goodbye.

Making money with NFTs is an extremely risky business. You should only invest in non-fungible tokens you fully comprehend and thoroughly enjoy. Choosing NFTs based on how much money you think you can make is a sure way to set yourself up for disappointment and even failure.

Performing due diligence for every NFT project you are considering buying into is a very crucial step in making money with NFTs. Remember, buy what you like, do your research, and don’t be greedy.