Previously, we delved into the art of cherry-picking the perfect platform token to invest in by considering four crucial viewpoints: utility, tokenomics, competitive advantage, and user experience. As a practical illustration, we drew your attention to the Blur case study, which brilliantly demonstrated how these perspectives could be leveraged to dissect real-world scenarios.
As the trend of NFTs gains ever more traction, it can be overwhelming to choose the best platform token to invest in among the plethora of options available. That said, in this article, we’re about to unveil five more critical viewpoints that will help you steer clear of the confusion and make a well-informed choice. We’ll explore the technology used, partnerships, roadmap, ecosystem, and security of each platform token to provide you with the necessary insights for a sound investment.
When it comes to blockchain, NFTs, and cryptocurrency, technology reigns supreme as the most critical aspect to consider. This is equally true for NFT platforms. The key is to look out for platforms that are constantly innovating and pushing the boundaries of what is possible with NFT technology. Those that are developing groundbreaking use cases for NFTs, such as gaming or virtual worlds, or that specialize in user trading and discovery experiences, are more likely to succeed in the long run.
Apart from innovation, it’s crucial to take into account the overall quality and security of a platform’s technology. Keep in mind that most potential users are new to the world of cryptocurrency, where they are solely responsible for safeguarding their own assets, and the approach to security is entirely different from that of Web2. Even in a bear market, such as the present one, significant losses can still occur due to scams, phishing, and fraud. In fact, as recently as February 2023, these attacks resulted in a staggering $57 million loss in the Web3 industry.
Therefore, it’s vital to seek out platforms with a proven track record of protecting user assets and employing robust security measures such as multi-factor authentication, cold storage, and regular security audits. A well-designed and secure platform is essential for instilling investor confidence and trust, given the high stakes involved in crypto investments.
Partnerships can be a valuable indicator of an NFT platform’s potential for success. Look for platforms that have formed strategic partnerships with other established players in the industry, such as well-known brands or prominent investors. Partnerships can help increase the platform’s visibility and credibility, which may ultimately lead to increased demand for its NFTs and services.
So, where can you find information on a platform’s partnerships? In addition to checking their partnership lists on their website, social media platforms such as Twitter and LinkedIn are excellent resources. Look out for collaboration posts, retweets, and reposts to determine the legitimacy and activity level of a platform’s partnerships. Moreover, listening to podcasts is also a great way to gauge a platform’s network and partnership strength. You can also gain a sense of the founding members’ or employees’ passion and understanding of the project, their business goals, and how well they comprehend their industry. Ultimately, a platform’s partnerships can serve as a significant indicator of its potential for success in the NFT space.
A clear and detailed roadmap can serve as a valuable tool for assessing an NFT platform’s potential for long-term success. Platforms that take the time to craft a well-thought-out roadmap outlining their plans for the future may be more likely to execute on their goals and deliver on their promises, leading to increased investor confidence and demand for their tokens.
When evaluating a platform’s roadmap, pay attention to its plans for new features, partnerships, and other significant milestones that could potentially drive user demand and market value. Look for realistic and achievable goals that the team can deliver upon, and ideally, the platform should provide parameters or a means of tracking its development progress.
However, a roadmap is only as effective as the team behind it. Consider the team’s background and track record when assessing their ability to execute on their plan. We should aim to avoid investing in projects with fascinating roadmaps but no execution power, as was the case with many NFT projects during the summer of 2021. Ultimately, a realistic and achievable roadmap, combined with a capable and experienced team, can increase the likelihood of a platform’s long-term success.
The ecosystem surrounding an NFT platform plays a vital role in determining its potential success. It encompasses the various features, use cases, and applications that the platform can offer and how its token can extend beyond the platform itself. A thriving ecosystem consists of developers, artists, and other key stakeholders who help to build a strong community around the platform. A platform with a large and engaged community has a higher chance of increasing in value over time.
For example, some NFT platforms focus on NFT minting, while others are geared towards secondary market trading or custody and management. By providing users with diverse utilities, such as cross-platform or cross-application functionality, platforms can expand their ecosystems and allow for the free flow of NFT assets for different purposes and services. The same can be said for platform tokens, which can serve various purposes beyond governance, such as paying gas fees, purchasing NFT assets, acting as cross-chain cryptocurrencies, and staking for rewards. By offering these utilities, platforms can attract more users and increase demand for their tokens.
When evaluating NFT platforms, security should be a top priority. Look for platforms that have implemented advanced security measures like multi-signature wallets, biometric authentication, or encryptions to safeguard user assets and prevent hacks or breaches. These platforms can be considered more trustworthy and secure for investors.
Additionally, it’s important to consider the platform’s security track record. A platform with no history of security incidents can instill more confidence and trust in investors. On the other hand, platforms that have experienced major security breaches or hacks may be considered more risky.
However, it’s also important to consider the user experience when it comes to security measures. If a platform’s security measures are overly complicated and hinder user experience, it may not be seen as an advantage. It’s crucial to strike a balance between strong security and user-friendliness to create a platform that is both secure and easy to use.
Final Thoughts
Evaluating and researching NFT projects can be an exhaustive and tedious process, especially when trying to account for various perspectives and factors. Finding a project that meets all of the criteria may be challenging or even impossible. However, sometimes, you can discover a hidden gem in projects that do not tick all the boxes.
It’s crucial to weigh the positive aspects and how they can convince you of the project’s legitimacy and potential. Moreover, don’t be afraid of failures or setbacks, as they can be valuable lessons that help refine your investment strategies. Remember that with persistence and perseverance, we can achieve success in the long run. So, keep at it, and WAGMI!
