7 Ways to Stay NFT Rich
The summer of 2021 was a magical time. People were becoming NFT Rich with ease. But the real question is, what did they do to preserve their riches? Are they now poor commoners again? Are they only rich in Twitter followers?
In this article I will discuss 7 ways people could have protected themselves from massive losses. I guess I must preface this by saying “this is not financial advice”. But in my many years of crypto/NFT, I have yet to see someone get in trouble for this offense. Just be smart when listening to people. Nobody knows what they’re doing and if they say they do, they absolutely don’t.
See the Euphoria? Start to Sell
We all know that feeling. Your heart is pumping, you’re imagining ways that you’ll be spending your future wealth. That’s a good indicator that we are somewhere near the top. It’s time to sell some, if not all your NFT assets. I know it’s difficult, but you are your own worst enemy during these times. Fight against yourself and you’ll be rewarded.
Convert Some Profits Back into Fiat
Congratulations, you’ve sold your NFT for a massive ETH profit. The next move that most people don’t do is convert some of that crypto back to fiat or at the very least a stable coin like USDC. Make sure you have a way of converting your crypto back to your native currency. Also, make sure you have a bank account linked to that source. There is no better feeling then seeing magical internet money make its way into your account. Especially, if you happen to share that account with your significant other. Major flex.
Invest in Traditional Markets
If you have taken profit, you’re ahead of the game. The trick here is not to buy frivolous things IRL. Take that “hard earned” profit and place it in traditional investment markets. It’s not difficult, hop on your LinkedIn and find a friend of a friend that works as a financial advisor. Reach out to them and explain your situation, they will be fascinated and excited to assist you.
When You Start Bragging to Friends and Family, Time to Sell
It will happen. That cringy moment when you start to swing conversations to NFTs, just so you can bring up your portfolio value. It’s ok, you’re not used to being virtually rich. But this is a great indictor that it’s time to take something off the table. We give ourselves warning signs during these brief periods of wealth accumulation and we don’t take advantage of them. If not, it’ll be really embarrassing when you see those people a few months down the road.
Don’t Be Exit Liquidity
It happened to me when I first jumped into NFTs. I was a “crypto guy” for many years and was dragged into NFTs by my best friend. He kept telling me “You’re a huge basketball fan! How are you not into NBA Top Shot? It’s right up your alley.” This was late January of 2021. I jumped in in February and had roughly 6 days of portfolio growth before we topped out and crashed spectacularly. I was exit liquidity; I bought a Talen Horton-Tucker moment for $150+. I think about that one to this day.
Don’t Become a Community Member
Communities are great if you’re looking to pump your Twitter follower numbers but that’s about it. Communities are echo chambers for bag holders. They will convince you to “diamond hand” the project or buy more when price dips. But believe me, without fail this is one of the best ways to lose profit. I won’t list you all the projects with “good communities” that have had 80% pullbacks or more. There are far too many to name. If you’re looking to be profitable and keep as much fake internet money as possible, stay far away from the title, community member.
Stay Away from Derivative Projects
This one sounds like a no-brainer, but the little greed monster that lives in all of us makes it so difficult to avoid the infamous derivative project. If you’re not familiar, the derivative project is an NFT based on a project that had great success. Think BAYC, Moonbirds, Azukis, MFers, etc. These NFTs magically appear overnight and can do a serious amount of volume. But realistically, by the time you are aware of it, it’s too late. Stay away from the knockoffs.
That is all the advice I have on the subject. I hope it helps you during the next market cycle. It probably won’t because we never listen to good advice when money is on the line. But I’ve done my part and hopefully you’re the exception that proves the rule.
If you like this article and would like to hear more from me, I am the co-host of The Mint Condition along side Bunchu and Dez. Check us out on YouTube or podcast here: