- Toby Hazlewood went from creator to investor when he minted two NFTs on the CryptoSaints project.
- He describes how he navigated which project to choose as numerous ones launched daily.
- He says he was mindful of the famous warning that 99% of NFTs won’t be good investments.
Big-name projects are where the headline-grabbing transactions happen in NFTs. Bored Ape Yacht Club has attracted six-figure investments from NBA stars, and many projects sell individual NFTs for millions of dollars.
The most expensive CryptoPunk fetched $7.58 million in March — it was first sold after minting in June 2017, for $$2,127.
When I first experimented with NFTs, it was in marketing and selling my own, made from a photo I’d taken on my morning walk. The experience yielded valuable lessons about a surprisingly complicated process.
I decided to become an investor too. But without spare millions lying around, normal people like me need to pick a longer-term winner among the projects, of which so many new ones launch daily.
Drawn in by potentially life-changing profits, I was also mindful of the NFT luminary Gary Vaynerchuk’s famous warning that “99% of NFTs won’t be good investments.”
If you’re not minting your own image or buying an NFT on a marketplace, you can become an NFT owner by minting one within a project. In my view, this offers the best chance of making a profit. It’s akin to buying a unique work by an up-and-coming artist, painted on demand.
The challenge is identifying projects you think will endure and appreciate in value.
My experience of investing wasn’t entirely successful. But this is what I learned about how to do it — whether to do it is up to you.
For me, the most important thing was to pick projects whose artwork I liked. Even if the project stopped before I could sell, I’d still own an NFT I liked.
I discovered The CryptoSaints on Twitter and immediately liked the pseudo-religious iconography. The figures and their attributes depicted in the artwork derive from NFT and cryptocurrency memes. I began researching the project.
You should establish whether a project has a bigger purpose or is just about minting a series of unique images. Both are good, but you want to know what you’re investing in.
Rarity.tools, an online catalogue of the bigger NFT projects, is useful. It lets you examine projects as a whole, alongside the NFTs within them.
When I looked up The CryptoSaints before investing, I learned that:
- The project began with a target of issuing 7,777 NFTs, and 2,024 had been minted at that point (2,135 had been minted when the project stopped issuing new ones).
- It has a strong investor base, with 731 owners of the NFTs.
- Its traded volume of 53.91 ether equated to about $255,000 invested in the project at that point — not huge compared to, say, CryptoPunks, but still a sizeable sum.
The stats suggested the project had attracted a large base of investors. They demonstrated a market of collectors who owned more than one of the NFTs, suggesting they viewed them as collectible.
The site ranks NFTs in any series by how rare their attributes are. Certain trait combinations make some NFTs more valuable. The rarest CryptoSaints NFTs hold nothing (1.5%) and don’t have a halo (1%). An NFT with both these attributes is more valuable.
Rarity.tools details the traits of NFTs from The CryptoSaints including their face, their robe, the item they’re holding, and whether they have a halo. Mine were scored as the 389th- and 730th-rarest in the series.
Bear in mind that when you mint an NFT, you don’t get to choose which attributes yours will possess; these are generated programmatically and in accordance with the coded logic at the time of minting.
After scrutinizing the project on Rarity.tools, I took my research further. Rarity.tools usually includes links to the project’s website, Twitter account, and
channel, where collectors and creators interact. Dip into these, asking plenty of questions. Look for any high-profile investors — their mere presence can boost value down the road.
The project’s website might identify its founders (often using pseudonyms) and other projects they’ve launched, as well as the minting price for new NFTs. There may be a technology road map outlining things such as the development of a metaverse gallery or play-to-earn games for holders.
Glean whatever information you can from this, but remember that statements are not guarantees and that websites are sales pages that can disappear overnight.
The minting cost of a CryptoSaints NFT at the time was 0.055 ether, or about $260, which is typical for many projects. With ethereum gas fees incurred for each minting and transaction, the total cost of an NFT could be under $400.
Minting is done by connecting your MetaMask crypto wallet, paying a minting fee (plus gas fees on the ethereum network), and submitting your request to the blockchain. Once completed, the NFT appears in your wallet and on Rarity.tools and OpenSea, an NFT marketplace.
But a project can still fail. CryptoSaints folded on November 30, and no more NFTs will be minted.
Its intended metaverse display space, the Basilica, won’t happen. This was disappointing — but as the project’s founders pointed out, investors paid for NFTs, and that’s what they got. These remain valuable in their own right. I love mine.
I’ll be holding them and watching where the market goes next.
To sell them, I’d need to market them myself and seek out other collectors on Twitter. The project’s folding may even bring publicity and notoriety to the NFTs, adding value.
If you’re interested in investing, evaluate projects thoroughly to find one that appeals to your wallet and, more importantly, to your eye.