With all the hype around NFTs, it can be hard to know what is good or bad when it comes to purchasing or trading your hard-earned money (or crypto) for these Non-Fungible Tokens. Luckily, you don’t have to be in the dark when it comes to the best practices for how to vet and trade these commodities. Below you will be able to access a document to educate yourself on how to navigate this emerging market.
by besancia
2021-08-26
What are the questions to ask yourself before buying an NFT? How to recognize suspicious practices in the ecosystem?
Introduction
Whether you are a veteran or a newcomer to the world of NFTs, there are a few project launches or even some activities that must have seemed strange to you at times.
Assets exchanged many times at extraordinary prices between two portfolios, a feeling of buying pressure when the project has just appeared, rewards that seem to always be distributed to the same accounts…
Wash trading practices are truly present in the ecosystem and the very nature of decentralization prevents their prohibitions. Faced with these practices, we decided to publish a guide for educational purposes so that everyone can ask themselves the right questions before buying an NFT (Collectibles, Video Games, Art, etc.)
We hope that you will find its content useful and that it will contribute to the “due diligence” of everyone during their adventure in web 3.0!
Download the report here :
https://nonfungible.com/subscribe/nft-market-safe-practices-2021
Part one: What are the questions to ask?
This part deals with the main questions to ask yourself before buying an NFT. It is not always easy to have all the key indicators in mind, especially with sectors that you are not used to dealing with.
We covered the different segments:
- Games
- Art
- Collectibles
- Metaverse
- Utility
- Sports
Even if the questions to be asked may seem simple for some, we nevertheless hope that they will allow everyone to build a personal strategy to protect themselves from malicious practices.
Part Two: What is Wash Trading?
This practice is widely used to artificially inflate the volumes of a project. But although it is known primarily for transactions, there may be other motivations behind its use.
We analyzed two segments to understand which schemes were used from June 2020 to February 2021:
- Collectibles
- Art
We recall that the objective of this part of the report is not to incriminate platforms or projects but to give all the necessary information to users as well as developers.
In this way, we hope that the discoveries we have made will help actors seeking common solutions to these problematic practices.
Do not hesitate to come and chat with us in our Discord if you have any questions or exchange around this report!
Download the report here :
https://nonfungible.com/subscribe/nft-market-safe-practices-2021
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