Rarity is one of the most important things in NFTs because the rarer the piece, the more expensive it becomes. However, you shouldn’t take everyone at their word when they say an NFT “looks rare”. Sometimes the term “looks rare” is used ironically or sarcastically for pieces that are actually cheap. 

Read on to find out what the term means and how you can make money off actual rare NFTs!

What Does Looks Rare Mean In The Crypto Space? 

“Looks rare” is a sarcastic term usually used when someone shows off their NFTs. Some people tend to comment “looks rare” on crypto Twitter posts to indicate that the NFT doesn’t look rare. In fact, crypto traders who comment that an NFT looks rare usually think that the digital asset in question is cheap. 

However, commenting that a piece “looks rare” doesn’t just come from sarcasm or irony. Sometimes people comment “looks rare” because they couldn’t get the piece in question and are just expressing their jealousy. 

Why Is Rarity Important In NFTs? 

Rarity is one of the most important things in determining an NFT’s value. But how do digital files that can be copied and saved become rare? 

The answer is that it’s not the image itself that makes it rare, it’s the non-fungible token that it’s attached to. This token acts as a certificate of ownership recorded on a digital ledger called the blockchain. Since there is only one of these tokens in existence, you’re effectively the only owner of that one piece of digital art. 

With generative art NFTs like CryptoPunks, each piece is assigned a number of traits. Generally, NFTs with many rare traits are more sought-after in the market, causing their price to increase. 

What Makes NFTs Valuable? 

So, what makes NFTs so expensive and sought after, anyway? Here are some things that make some NFTs more valuable than others.

Rarity

Rarity is one of the first things that influence an NFT’s value. While NFTs are inherently unique because each is one-of-a-kind, some are rarer than others. Generally, rare NFTs have smaller supplies or rarer traits than other pieces – these can become digital gold that’s valued at millions of dollars. 

History And Origin

Another important factor is the NFT’s history of transactions and origin. Generally, NFTs from already established creators or celebrities will fetch a much higher price compared to ones made by newcomers. For instance, famed digital artist Beeple once sold an NFT of his art for $69 million. 

Utility

An NFT that has more use than simply being a digital collectible tends to be valued more than purely decorative NFTs. Some good examples of utilities found in NFTs include game items or power-ups, membership cards, and authentication for real-world luxury goods. 

Liquidity And Ease Of Sale

Last but not least, the most valuable NFTs in the crypto industry are highly liquid. This means that the NFTs are easy to sell in the secondary market because they are in demand. 

NFTs that aren’t liquid are harder to sell, possibly signifying low demand. Most NFT investors prefer liquid NFTs because that means there’s less risk of not being able to sell them.

Maximizing Profits On NFT Investments 

Most people collect NFTs to make a profit down the line. If you’re one of those people, here are some strategies to ensure you make the most out of your NFT investments:

Flip Your NFTs

Flipping an NFT means that you buy an NFT at the lowest price, then quickly turn around to sell it at a higher price. Generally, flipping NFTs are best done if you get a good deal on an NFT from a well-known creator or become an early buyer of a fast-rising NFT collection. 

Hold, Then Resell

Another viable investment strategy to maximize your NFT gains is by holding it for a short time, then reselling it. Generally, this strategy is best done with cheaper NFTs that have good underlying value. 

Be careful that you don’t accidentally spend thousands of dollars on one-hit-wonder NFTs because their price usually falls and never comes back up. 

Buy And Hold NFT Projects That You Believe In

If you’re planning to hold NFTs for the long run, buy into projects that you believe in. Pick an NFT project that you find promising and read up on its whitepaper to know everything you need about it. Even if the prices fall, you’ll have faith and won’t end up making a bad decision. 

Closing Thoughts 

“Looks rare” is often used derisively when looking at certain NFTs, whether because it’s really a cheap NFT or because of jealousy. If you want to profit from real rare NFTs, follow the tips we covered above!

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