Our NFT art appraisals are based on fundamental valuation principles as well as subjective input, i.e. a highly developed sense of style resulting from extensive exposure to the global art world.

While we would all agree that aesthetic preferences are subjective, we pair these opinions with objective valuation analysis, so that those in the NFT Club have the tools to make their own informed decisions on whether to Take it or Leave it. We seek to examine the factors that contribute to NFT value to better inform our readers.

Why NFTs Valuation Models Are Different than Crypto

Non-Fungible Tokens (NFT)s share a nascent appraisal model that is ever evolving. In fact, a main reason why NFTs are interesting is because they are NOT fungible i.e. one NFT is NOT identical to the next one and should NOT be evaluated like crypto, as there are many additional valuation factors that come into play with NFTs.

Crypto prices fluctuate in part as a result of supply and demand, and FOMO (Fear of Missing Out). While these factors also impact NFT valuation, the similarities generally stop there. Here are a handful of the multiple additional factors that impact NFT valuation:

NFT Valuation Factors for Anticipated Future Value

Total Collection: Number of Assets in Existence. Is this art piece 1/1 or one out of 10,000 pieces

Rarity: Does this specific NFT have rare or “hard-to-get” traits

Recent Start: Are you able to get in before the official 'mint' and/or right after the launch of the project? This positions you for better upside potential

*Smart Money: Does this collection have a high # of smart money holders in comparison to the general public? This is a strong signal that you are still early and have potential upside

Sales: Most Recent Comparable Sales and Average Price points

Community: How many true and engaged followers are on Discord, Twitter, Instagram, Twitch? What % of the current collection are unique owners (High diversity of owners show strong support and less risk)

Culture: Has this artist also had commercial success doing collabs with other zetigeist-y artists or brands that create trends

Collection Volume/ Churn: 24 hours, 7, 14 day listings, bids, transfer activity

Demand: If top collectors are regularly buying pieces from an artist, that is a strong signal that that artist's pieces will continue to appreciate in the long term

Momentum: Do they have a formula for gaining momentum and getting people to talk about the art project

Utility: Do they have a current characteristic that gives them immediate value, which accrues over time depending on the popularity of the underlying project

Vision: Do they have a long-term roadmap for what they plan to do with their art to add value and/or career as an artist

Historical Significance: Does this NFT represent a significant moment in history or a turning point in how we use AI

Tangibility: Do these NFTs have expiry dates, like tickets; NFTs with tangible value are best suitable for short-term trading on the marketplace.

Maintenance: To maintain the security of a piece, proper storage is required. Is it On Chain, IPFS, AWS, Hard Wallet

Want to learn more or have your NFT project appraised?

Have some suggestions that should be included here?

Contact Cecily Robyn Lough via the contact form in the lower right corner.

*Smart Money is a collection of entities that have a proven track record of success. Take It or Leave It NFT sources this information as well as other factors from a few on chain data analytics platforms that monitor and label 100 million wallet addresses.

Please note that although best efforts are made to ensure that all information is accurate and up to date, occasional unintended errors may occur. In addition, the dynamics of the ecosystem change quickly. Nothing in these newsletters should ever be considered financial advice. These newsletters and posts contain opinions, news, and observations only.