An NFT or Non-Fungible Token is a blockchain-based certificate that proves ownership. NFTs provide a fully transferable and universally regarded form of title ownership.
These unique cryptographic assets are transfiguring the globe and upsetting all industries beginning with art and finance but progressively pushing their way through fashion, sports, and beyond. Nansen gives an in-depth guide about NFTs here: Everything You Need to Know About NFTs.
A group’s release of NFTs with a limited supply constitutes an NFT project. NFT collections note stylistic resemblance with different traits.
Yuga Lab’s Bored Ape Yacht Club NFT project is a great example. One of the most recognizable collections in the digital asset space. NFTs are prized not only for their monetary value and social standing but also because their owners retain the ability to commercially exploit their NFTs in any way they see fit. This utility case was leveraged by Universal Music, which formed the band Kingship from Bored Ape NFTs, and Cordell Broadus (Snoop Dog’s Son) used his Bored Ape to market cannabis products.
The 10,000 unique NFT assets in the Bored Ape Yacht Club collection are all primates, but they differ in various ways. The more uncommon the attribute, the rarer the NFT and thus the more desirable. Investors can utilize Nansen’s NFT God mode to see a comprehensive project breakdown and even filter by certain traits: NFT God Mode: BAYC.
NFT’s rise has been aided partly by its simplicity compared to other blockchain-based applications like DeFi. Additionally, these non-exchangeable data units with ownership proof have given authors a different way to make money from their works.
NFTs have enabled the play-to-earn model in the gaming industry. The larger collections, however, are primarily social currencies; crypto investors use NFTs to signal their wealth and status. Investors are known colloquially as a “PFP” (Profile Picture) and use these NFTs as a status symbol on Twitter.
Nansen can be used by investors who want to stay ahead of the crowd. This blockchain analytics platform combines millions of wallets with on-chain data to deliver market alpha and condenses all of this information into investor-friendly dashboards. Nansen’s NFT Paradise Dashboard provides an overview of the top NFT projects, including their real-time floor price, volume, and which projects Smart Money (the most profitable NFT traders) is minting, selling, and holding.
Top 2022 NFT Projects
- Bored Ape Yacht Club.
- Axie Infinity
- World of Women
- Clone X
- Flyfish Club
- Ethereum Name Service (ENS)
Not technically an NFT collection, but a utility application of NFT technology and perhaps a glimpse into the future. The ENS protocol has seen a significant increase in volume, and it is a naming service that allows users to register human-friendly domain names to specific blockchain addresses. This process simplifies and digests the future decentralized web for average users, and this convenience will be critical in driving mass adoption.
The bear market has not spared the digital asset space, and large marketplaces like OpenSea have seen a significant drop in trading volume. Despite this, the price and volume metrics ignore NFTs’ growing utility application.
Nansen, a blockchain analytics firm, uses on-chain data and millions of wallet addresses to provide deeper insight into the crypto space. Tracking the activity of smart wallets can be helpful in these bearish times. These wallets are the best NFT traders on the chain, and seeing what these wallets are minting, selling, or buying provides a unique perspective. Smart money wallets coined many of the projects mentioned above, and for investors seeking market alpha to outpace the rest, Nansen provides dashboards to facilitate this information asymmetry.