NFTs Are A Cash Grab That Feeds On People's Greed
I'm not greedy, so I should sit out of it, right?
Just like how some people argue that NFTs are a ponzi scheme, the same people are likely to think of NFTs as a quick cash grab scheme engineered to prey on people's greed. *Note I argue that there's more to the Ponzi-appearance in that article.
Having said that, this article shifts the discussion away from what NFTs actually are, and rather, delve into the psychology of greed. Are most speculators bound to lose out? And should you sit out of it just because you don't associate yourself as greedy?
Why NFTs Bring Out The Inner Greed
One of the seventh deadliest sins, greed is when we want more of something. Greed knows no bound, and yet, is greed necessary bad?
The reason NFTs can invoke such high levels of greed is because of its rapid development – advancing in not just use cases and adoption, but also price. 2X and 3X are a daily sight, and at least a handful of projects will 10X in any given month. The allure to grow your wealth, to "create generational wealth" as many people would like to call it, is as real as it is possible.
The challenge with greed is that people ALWAYS hope for higher. If you know how to take profit, congratulations, you've some ability to control your greed. NFTs are a speculation, it is a bubble, we all know it, yet the idea of a moonshot always lies in everyone's minds. So is there a right formula to "controlling" greed?
Managing Your Risk When Buying NFTs
There's ONLY ONE RULE you need to remember to contain your greed:
Catching the lows and the highs are PURE luck. You can never time it perfectly.
Once you can acknowledge that fact, it's time to move into some ways of managing your risks:
Only invest what you can afford to lose. Classic, but essential that you don't take out a loan for NFTs.
In the long run, you want to be HODLing projects that you have absolute faith in (after you did your research).
Always stay liquid. Have that liquidity in ETH/SOL/crypto to average in when the market dips.
Buy multiple pieces so that you can take partial profit. A simple way could be to buy 2 to 3 NFTs at mint, while the richer and more seasoned pros usually cop a bunch of Floors and 2 to 3 Rares.
De-risk and sell when you are up. The gacha mechanism is rarely in your favour, if you're running short of liquidity, sell that extra NFT to recoup your cost or get some ETH.
Be fking patient. Don't FOMO because other projects mooned and yours stagnated. The problem 95% of people face is comparison and the idea that projects should moon within three months.
Despite emphasizing on the importance of HODLing, it may not be a bad thing to paper hands, if you need that liquidity to get into the next mint. It may also be wise to HODL crypto when you expect the coins to surge rather than leave it in NFTs (because many others will sell for profit and floor prices and demand of NFTs will go down).
Are NFTs Only For The Greedy, The Degens, And The Autists?
No, they are not! If you get the bigger implication of NFTs, on how they'll become the next social media, then treat this as a five to 10-year play and you'll be find HODLing NFTs. As long as you pick the winners that will be around in the long run of course.
Yet, if you plan to make short-term trades of a few weeks to a few months, yes, you're likely to be classified amongst the greedy, the degens, and the autists. Yes, these terms are derogatory, and rightfully so, because it's a gamble to be buying in during a very hot market.
Personally, I'll recommend you to get in for whatever reason. Whether you're there for the short-term gains or you plan to HODL projects forever, getting in and getting involved will open your mind to more possibilities than just monetary gains. As many NFT advocates will swear by it, you're not buying the JPG, you're getting a community.
That's also where the friendly greetings come in. GM, GN, and WAGMI (: