With the world moving slowly towards digitisation, it’s safe to say that fashion has jumped on the bandwagon as well. While fashion NFTs might not be as widely used and bought as art NFTs are, there’s definitely an NFT boom we’re set to experience. So if you’re invested in the idea of crypto fashion, here are some things you should know before you do the deed!
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1. You’ll Need A Cryptocurrency Wallet
The first step in buying any NFT is to set up a cryptocurrency wallet, from where a crypto-based transaction can take place. One can only pay for an NFT with cryptocurrency, which makes it a must. “I always recommend a Metamask wallet because it is the one wallet that is accepted in all possible websites. Once you do that, you have to put money into your Metamask wallet in Ethereum. I recommend Ethereum, it’s pretty easy to convert Etheruem to Solana and vice versa,” says NFT and fine art consultant, Arushi Kapoor.
Image used for representational purposes only.
2. Do Thorough Research
Buying an NFT can prove to be quite an investment, exactly why it’s important to have all the right information about a particular NFT project before investing in it, just like you would do with any other piece of investment. “I usually ask my clients to go through sources that are not related to each other. What that would do is, open up your mind on how exactly the NFT world works. Once you have familiarised yourself, you can pinpoint a couple of projects that are already established and those that are upcoming, basically projects that haven’t been minted yet,” adds Kapoor.
Image used for representational purposes only.
3. Have A Plan In Mind
Besides the whole idea of an NFT purchase being new to you, something more important to consider is your long-term view of how you see the investment playing out for you. “If you’re putting in, say $1000 in NFTs, they should know when they will come out of it or they want to hold it long-term and see where it goes. You have to have a clear picture of how you’re planning to deal with your NFT portfolio, much like your stock portfolio,” says Kapoor.
4. Real Life Perks
It can get a little tricky to figure out the use of a fashion NFT outside of the metaverse world. With the advent of various designers like Dolce & Gabbana, Gucci, Soulland having already launched NFTs, and many more coming up with exciting projects, you might want to consider what you’ll get out of the project in the real world. While the fashion NFT is still yet to flourish and evolve completely, its aesthetic beauty is also something you’d like to consider buying it for. According to Kapoor, another thing to factor in is whether or not you identify with the community behind the NFT project.
Image Source: Instagram/shereenlovebug
“Anytime you’re buying an NFT you’re also promoting it. So you definitely have to make sure you’re identifying with the community you’re putting your money in or you’re buying an NFT of,” explains Kapoor. To put things into perspective, the recently announced collaborative NFT by Adidas Originals and Prada that is set to feature user-generated art, will also dedicate a majority of the proceeds from its auction to Slow Factory, a non-profit organization and institute that works towards human rights and environmental justice. This would be a great example of how one would be able to support a cause they believe in through NFTs.
5. Details to Look At
Reading the fine print, as important as it is for many financial investments, is also important for an NFT purchase. Some factors to look into before investing in an NFT project, as per Kapoor, would include the project roadmap, the volumes traded, the liquidity pool, the percentage of royalty the artists involved are being given as well as a three to five-year plan of the project. “Each NFT project now, in my opinion, works almost like a start-up. So you have to analyse the project like you would analyse a start-up,” adds Kapoor.
Image used for representational purposes only; Lead Image Source: Instagram/cryptofashionweek, sharannya_official, lucii__
Got any more questions about buying an NFT? Hit us up in the comments!