7 points artists must take note to growing their NFT portfolio!

by Groove Team
Concept of converting a work of art into a unique token. ART to NFT, non-fungible token. Painting is converted into a digital file. Innovation technology. Vector 3d

A NFT is a digital asset that represents a real-world item, such as art, music, in-game items, or videos. Online, they are purchased and sold with cryptocurrencies, and are generally encoded with the same underlying technology as many cryptocurrencies.

To succeed in NFTs, an artist must have two things: acumen and audience. In addition to practicing their craft, successful crypto artists spend time developing their fan base and educating themselves about cryptocurrency and blockchain protocols, including how to avoid scammers. Beeple’s success was not an overnight phenomenon; he had been honing his digital art skills for over a decade before his first NFT sale. His $69.3 million collage, Everydays-The First 5,000 Days, is in fact a collection of daily digital drawing exercises he has been creating and sharing since 2007.

Nifty Gateway co-founder Griffin Cock Foster has been a crypto art collector for years and believes that it all boils down to talent. As an artist, he says, “I think you have to develop a whole set of skills.”. To stand out from the crowd, you have to think outside of the box and make a difference in a way that catches people’s attention. Successful technical artists are successful people.”

There is always a degree of subjective judgment involved in judging artistic merit. Beeple relies on Christie’s for support when it comes to commanding millions. According to Mike Steib, CEO of the arts marketplace Artsy, the NFT market isn’t exactly the free-for-all platform many believe it to be. “Who sold Beelple?” he asked. He argues that the election was not democratic. Among the biggest gatekeepers in the whole art world was Christie’s. “

Here are seven points artists must take note of while growing their NFT portfolio:

1. Art Forgery Reduction and Authentication:

A collector receives a valid certification of ownership, as well as proof that each piece of art is the work of its creator. You can view the entire transaction history of your purchase on websites such as etherscan.io

2. Digital Editions:

Digital editions can be traced back to the creative, and limited editions can be made available to the public. A YouTube star sold $5 million worth of NFTs (his own version of Pokemon cards) recently, Say What!!!!

3. Future sales compensation:

The documentation accompanying NFTs is extremely trustworthy, and it is possible to attach code to make the files do almost anything engineers can dream up (for example, the ability to make sure royalty payments go to the original creator).

Incentives for creating new artworks are provided to the original artists, who get a percentage of the resale of the artwork. However, there are some caveats. For creator shares, few platforms use a method that can be replicated on secondary markets. The creator share percentage is only paid if the secondary sale also takes place on the platform the original sale took place on.

4. Shared Ownership:

“With NFTs, you could collect a valuable piece and fractionalize it, put it on a bonding curve, and sell fractional pieces of work to a variety of people.” Imagine there was a well-known artist like Pak, who was really popular. An index fund could be created based on a bunch of Paks bundled together. The same way you can have exposure to commodities without owning an individual pak, you can have tokens in an index fund as part of that investment.”

Founder of talent management firm One-Day Entertainment, Zack Honarvar, admitted that he and Airrack, a creator he represents, have been thinking about printing NFTs to give fans the option to “share” videos before they are uploaded.

“When a person purchases that NFT, they will receive a tenth share of video ads. You would own that video in advance if you purchased it in advance.”

Zack Honarvar

5. Better economics for creators:

Firstly, rent-seeking intermediaries can be eliminated. Blockchains operate on the same logic as in real world transactions, where once you buy an NFT, you have full control over it, just like when you buy a book or a pair of sneakers. As long as there are NFT platforms and marketplaces, their fees will be restricted because blockchain-based ownership empowers creators and users – you are free to shop around. (Cutting the intermediary fees can increase creator income several fold. For example, if you make $100k in revenue and have $80K in costs, lowering the 30% can boost your revenue to $200k and your disposable income to $120k from $20k.)

A percentage of every sale is yours when your work is purchased and sold on Nifty Gateway. This percentage is up to you as an artist – you can choose between 5% and 50%. The 5% plus 30 cents charged by Nifty Gateway is used to pay credit card processing fees as well as to keep the platform running.

6. Price titling by granularity

NFTs enable granular price tiering, which changes creator economics. The revenue generated by ad-based models is largely constant, no matter how enthusiastic the fans are. In the same way as Substack, NFTs allow a creator to offer members special items at a higher price to create a “cream skim.

NFTs are different from non-crypto products because they are easily sliced and diced into a series of descending price tiers. Depending on the issuer, NBA Top Shot cards can fetch as much as $100K or less. Are you a fan of Bitcoin? Depending on your level of enthusiasm, you can buy as much or as little as you want. With crypto, creators can capture much more of the demand curve in a finer-grained manner.

7. Ownership conversion:

By making users owners of their content, NFTs change creator economics, reducing the costs of customer acquisition to almost nothing. Any Tech S-1 filing shows massive advertising and sales expenses for acquiring customers. As a contrast, Crypto has built a market capitalization of over a trillion dollars despite spending little on marketing. Tens of millions of people use, own, and love Bitcoin and Ethereum, but they don’t have marketing budgets or organizations behind them.

In just the past month, NBA Top Shot, the highest-grossing NFT project to date, generated $200M in gross sales for very little marketing spend. Having a stake in the company has helped it grow so quickly. Community, excitement, and ownership drive peer-to-peer marketing.


Capital gains taxes apply to NFTs, just like when you sell stocks for a profit. Because they are considered collectibles, however, they may not be eligible for the preferential long-term capital gains rates stocks receive and may even be taxed at a higher collectibles tax rate, though the IRS has not yet ruled what NFTs are considered in taxation. When considering adding NFTs to your portfolio, it may be a good idea to check in with a tax professional if the cryptocurrencies used to purchase the NFT increased in value since you purchased them.

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