Can You Lose Money on NFTs? Here are Ways
For digital asset creators, non-fungible tokens (NFTs) have opened up a lot of opportunities, especially as a way of authenticating and selling their art. What they just need to do is to purchase some cryptocurrency, find a platform, pay a fee to tokenize the work, and put their work up for sale for a starting amount, then wait for buyers to bid.
On the part of buyers and collectors, such platforms have become a sort of gallery where they can browse available works and decide which ones are worth bidding on. You can think of it as a digital version of art collecting, because it is essentially is.
So, NFTs offer a way for digital creators to earn money but the question is, can you lose money on NFTs? The answer is yes. Keep in mind that NFTs are virtual assets and a lot of criminals exist in the digital world. Moreover, you should also remember that values can decline depending on the current situation.
How You Can Lose Money on NFTs
Some People Steal Art Works
As a creator, your art is your asset, which you can convert to real money when sold. This is true in both the real and digital worlds. When you lose your art for some reason, you also lose the opportunity to earn money.
While stealing art is much rarer in the real world, it is more common in the world of NFTs. There are numerous accounts of digital art being stolen by malicious individuals who take these works, mint them into tokens, and put them up for sale on NFT platforms. An example of this is RJ Palmer, who discovered that some of his pieces were tokenized and posted for sale on Marble Cards in 2018. Fortunately, the works were not sold.
Losing Value
The hype surrounding NFTs definitely caused the surge that the world saw earlier this year. Some marketplaces were selling thousands every day, with the market reaching 49,000 sales per day back in March. As the hype died down, the number of sales and spending on NFTs declined, which means that some of the works may not sell as high as they used to be, unless the artist is renowned or the work is just that iconic.
Now, imagine buying a token for a high price at the start of the hype, then trying to sell it at the same value when the hype dissipated. You might need to lower the price in order to sell. A similar
thing is happening with Mark Cuban, who purchased Nuevo Galaxy for 0.4 ether in April and is now selling it for a higher price. It still hasn’t been sold.
Hackers Steal NFTs
Back in March, Nifty Gateway users reported that their tokens were being stolen. The malicious parties even used saved credit card information to purchase new NFTs.
Preventing Losses with NFCs
If you are a creator or an owner, you want to make sure that your tokens are safe and protected. Artizyou offers a more secure way to mint tokens with the help of the Blockchain Intellectual Property (bPI), which tracks, authenticates, certifies your asset. The result is not an NFT, but a non-fungible certificate (NFC), which is a more protected version of the tokens.
The Bottom Line
Creators and owners invest money in minting and acquiring these tokens, so it is only right to protect their money by going on a secure platform. Artizyou is a great option for protecting your digital assets.
https://www.vice.com/en/article/n7vxe7/people-are-stealing-art-and-turning-it-into-nfts
https://www.theverge.com/2021/3/15/22331818/nifty-gateway-hack-steal-nfts-credit-card
