In recent years, non-fungible tokens (NFTs) have soared in popularity — and it doesn’t look like the momentum will be dying down anytime soon. NFT artists potentially can make some cash (or cryptocurrency). But how much?
New research from Crypto.news found that the average price of NFT art is $232.24, with the top 20% of NFT art collections pulling in over $8,000 in sales over a 30-day period between mid-June and mid-July. One in four NFT collections rakes in at least $3,773.63 per month, or $21.77 per hour, touting an average price of $862.52 per piece.
Are these numbers accurate, and furthermore, how can interested artists break into the NFT space to rake in a profit?
Wealth Awaits — But Only for Some
Before you go diving into making NFTs solely to land a windfall, bear in mind that not every artist will prosper in this increasingly competitive and saturated field — far from it. In fact, the numbers in this new research are more than a bit misleading.
“It is possible to make this much money; however, these figures are skewed enormously by the bloated returns earned by the very top collections, which can sell for hundreds of thousands of dollars per NFT,” said Dan Ashmore, cryptocurrency data analyst at CoinJournal. “All through the crypto rally, there was a growing centralization of wealth among the top NFT collectors.”
It’s Pretty Easy to Break Into the NFT World
The length and rigor behind creating art wholly depends on the artist; but, once her NFT work is complete, she can very easily push it out into the world.
“One can upload a collection of photos to the blockchain in minutes,” Ashmore said.
The barrier to entry may be lore, but it does take work to make it catch interest and ultimately sell an NFT.
“The challenge is really in the marketing rather than the art — the blockchain makes the idea of NFTs accessible to all,” Ashmore said. “The most successful collections have built up a type of exclusive, members-only club where to gain access you need to own an NFT. This involves things such as merchandise for owners, private online chat rooms, events such as members-only parties and other ideas.”
Stand Out From the Crowd
NFTs are hot, hot, hot — which means artists must stand out from the crowd with a remarkably distinct piece/collection.
“To get started with NFT art, one must have unique artwork,” said Sudhir Khatwani, founder at The Money Mongers. “If it’s not unique, it will not get much attention as thousands of people are selling NFTs online these days.”
Making Money Off NFTs
There are a few ways to make money off rendering NFTs beyond just selling them. Jonathan Merry, director at Bankless Times, walked us through some possibilities:
- Leasing Out. “The procedure of renting isn’t in the least bit complicated; it operates similarly to leasing out a piece of real estate and collecting rent,” Merry said. “An NFT can be rented by giving it on loan to someone for a predetermined period of time in exchange for cash. An efficient technique to earn profit from NFTs without giving up ownership is to rent out the property.”
- Earning Royalties. “The developer of a digital asset might still get passive lifetime royalties even after selling it to a third party,” Merry said. “However, the creator must impose these conditions; and, if someone purchases the asset you made, you will receive royalties for the rest of your life. Royalties are a great source of passive income for artists. When it comes to making money from NFTs, royalties are important to take into account, despite the initial confusion they may cause.
- Trading NFTs. “Some business owners and investors buy and sell NFTs like stocks in order to make money,” Merry said. “You can easily sell your collection of NFTs if you no longer need them, in the same manner you would if you had produced them yourself. The only step you’ll skip is the minting procedure. Understanding when to sell is essential when trading NFTs though. Making money from NFTs via trading may appear dangerous to some, but the rewards can be substantial.”
Steps To Take To Get Started
To kick off a career in NFTs, here’s what you need to do:
- Have an Ethereum wallet. “This is actually inevitable,” said Igor Zakharov, CEO of the DBX Digital Ecosystem. “Most NFTs are solved via the Ethereum blockchain; and, as such, Ether is the standard medium of exchange used to both buy and sell NFTs.”
- Build an audience/community. “NFTs are highly community-driven and this is a vital step in launching a successful NFT career,” Zakharov said. “Besides the obvious social media platform used to build communities, other websites such as Telegram and Bitcoin Talk can be helpful.”
- List your NFT. “Conduct some research and determine where to list your NFTs for sale,” Zakharov said. “There are a number of NFT marketplaces, including Open Sea and Super Rare. It could be necessary to list on multiple platforms to widen your chances of making sales.”
- Build an audience. Market your art and build a community on online platforms including Discord, Reddit and Twitter.
What You Actually Stand To Make
Realistically, a talented and aggressive NFT artist can expect to draw in decent dough in the first year — at least enough to count as a decent side hustle.
“The space varies immensely, but serious artists breaking into the NFT space should expect to make at least $10K in their first year,” said Rylee Armond, a cryptocurrency/NFT media consultant, NFT artist and the founder of Omnicake Web3 Media Consulting. “Have there been projects or artists that make more than this? Of course, especially if a larger project mints out (sells every NFT), this can be much more than $10K in total.”
More From GOBankingRates
- Living Frugally: Adopting Lessons From the Great Depression
- The Average Retirement Age in 2023 in the US vs Canada
- 3 Things You Must Do When Your Savings Reach $50,000
- 7 Ways To Squeeze the Absolute Most Out of an Average Salary