If you have been involved in the NFT space then you have probably heard of NFT collections. It’s a relatively simple concept but it’s important to understand as it’s a core feature of the ecosystem.
But don’t worry. In this article, I will be covering all aspects of NFT collections so you can navigate the space with ease. So without further ado, let’s jump right in.
As the name suggests, NFT collections are a group of NFTs. Each asset in this assortment contains unique characteristics. The characteristics and supply of the collection are determined by the artist.
What are NFT collections?
NFT collections are a variety of NFTs grouped. The total supply of the collection is set by the artist. For instance, for Bored Ape Yacht Club and CryptoPunks, the creators set a hard limit of 10,000. This is immutable and cannot be changed.
Moreover, each NFT in the collection is stored on the blockchain. The blockchain is essentially a database that is transparent and open source, while NFTs are assets with unique metadata.
This metadata includes the token ID, address, and transaction history. Additionally, it includes the collection that each NFT belongs to. This is all verifiable which guarantees authenticity.
What makes an NFT collection valuable?
Utility – simply put utility provides value that extends beyond just the basic form of NFTs. Creators provide rewards to loyal community members. For instance, NFTs can be used as receipts to redeem exclusive music or merchandise. The more utility the NFT collection has the better.
Original artwork – at the end of the day, if the artwork of an NFT collection is bad then it will ultimately fail. Look for artists with new innovative art and it will likely fair better than another Bored Ape Yacht Club clone. Like most artwork this is subjective, therefore an eye for good designs will likely come with time.
Strong Reputation – for an NFT collection to be valuable it needs to have a strong reputation. Teams that have consistently delivered on their promises and have institutional backing are good signs. On the other hand, if the team is relatively new and anonymous this would be a red flag.
Rarity – this is simple supply and demand. If the supply of an NFT is lower then the collection will likely be more valuable. You can check the supply of a collection on a blockchain explorer or an NFT marketplace such as OpenSea.
Community – lastly, the community is key. If the project is without a group of loyal fans it will fail. Healthy NFT collections should have hype around them. This will only happen if there are discussions whether that be through Twitter or Discord.
Examples of NFT collections
Bored Ape Yacht Club (BAYC)- this is the most popular NFT collection and rightfully so. It has garnered international attention with the likes of Jimmy Fallon and Eminem sporting them. With over $1 billion in total trading volume, it has become quite the phenomenon.
Featuring a set of 10,000 digital apes with a combination of 172 different characteristics they are certainly unique. Each NFT also provides utility in the form of a membership. They act as a ticket that grants access to exclusive events. One of which is ApeFest in New York City.
CryptoPunks – created in 2017 by Larva Labs founders Matt Hall and John Watkinson this project has developed quite the reputation. It has strong demand with millions of dollars in trading volume.
The artwork features a collection of 10,000 pixelated avatars inspired by the 1970s punk movement. Each member of this band of outcasts has a set of unique traits. This ranges from humans to aliens or gold chains to purple lipstick.
Where to buy NFT collections?
NFT collections can be bought on any of the major marketplaces. This includes:
OpenSea – founded in 2017 by Devin and Alex it is the largest NFT marketplace with 1.5 million active users and over $20 billion in trading volume. This is a behemoth in the space, to say the least.
Overall, it features an intuitive interface that allows users to filter their favorite collections. Not to mention, it supports several crypto wallets including Coinbase wallet and Glow.
Magic Eden – this is another fantastic alternative that primarily utilizes the Solana blockchain. Thanks to this technology, transactions are cheap and fast. With marketplace fees at just 2%, it is considerably cheaper when compared to OpenSea.
Like OpenSea it features a user friendly design and the ability to filter by your favorite NFT collections. Not only that, but it has a launchpad that help creators launch their collections. So if you are looking to launch your own NFTs then this might be the place for you.
As you can see the concept of NFT collections is relatively simple. That being said, finding the right marketplace and collection to buy can be challenging. But rest assured if you follow the tips in this article than you can navigate the NFT space with ease. I hope you found this article useful and thanks for reading.
Curious about whether you can screenshot NFTs? Click here to read my previous article.