buying an NFT

NFTs are the new trend of fashionable collections. Buying an NFT is within everyone’s reach. However, the specific characteristics of these non-fungible tokens make them both a profitable and risky investment sector. Transactions are generally carried out via a foreign intermediary platform which requires compliance with a consumer code. These conditions concern both professional NFT sellers and collector buyers (investor, trader or simple digital art enthusiast). To avoid losing (hard-earned) money, here are some typical mistakes (technical or behavioral) to avoid when buying an NFT.

1. Connect your crypto wallet to unknown sites​

Having a crypto wallet facilitates transactions made on NFT sale/purchase platforms. For your security, it is recommended to use several  crypto wallets  on each blockchain. Always for the sake of security, it is advisable to only connect your wallet to a trusted site, whether to take advantage of an Airdrop, participate in a mint or use the “collect an NFT” function. The trick is to keep all your assets on a third-party address (preferably a cold wallet) that will never be used on an unknown site.

2. Leave your passwords on your PC​

Storing all of your passwords on your computer poses significant risks. Whether on a desktop computer or a laptop, the risks remain high. A malicious person can search your computer and steal your passwords. The worst case scenario would also be to have your laptop stolen and lose all your important data, including passwords. Moreover, computers, no matter how modern, are never completely safe from all kinds of hacking. Even virtual backup tools are unreliable. The ideal is to remember your wallet pass by heart, if you don’t have a particularly secure place to store them.

3. Rely only on the rarity of an NFT

In the world of non-fungible tokens, the rarer a token is, the more valuable it is. Buying a rare and priceless NFT collectible allows the collector to make a significant profit on resale. However, this theory is reversible. An NFT can be as rare and genuine as it may become of no interest to other collectors over time. In this case, you will have bought a rare coin at a high price without being able to resell it afterwards and profit from it. Relying only on the scarcity of an NFT presents the risk of losing liquidity. To find a new buyer, it will be necessary to considerably lower the selling price and generate a loss.

4. Skip the crypto and NFT training stage​

Cryptocurrencies and NFTs are new and risky investment sectors. It is about investing a large sum of money, perhaps the savings of a lifetime, hoping to make substantial profits. Also, before jumping into the water, it is essential to train with an experienced professional. Several free NFT and cryptocurrency training offers are available on the Internet. All the tools of modern technology are deployed to quickly learn the world of NFTs and crypto currencies. The sooner you decide to train, the sooner you will make a profit.

5. Invest money you don't have

Whatever type of investment you want to make and especially in the case of NFTs and cryptocurrencies, a promising project deserves dedicated funding. The beginner’s mistake is to take on immeasurable debt in hope of making a huge profit on the first investment. However, in this field, everything is possible. You can win or lose at any time, due to the volatility of digital assets. A professional investor is one who prepares to invest an amount that he is ready to lose. This kind of mindset you’ve got to have tto proceed in NFT sector. Otherwise, you risk chaining losses and debts over several years.

August 3, 2022

Buying an NFT: 5 beginner mistakes to avoid

NFTs are the new trend of fashionable collections. Buying an NFT is within everyone’s reach. However, the specific characteristics of these non-fungible tokens make them both […]