What Are Blue chip NFTs?

Non-Fungible Tokens have become quite a thriving and lucrative aspect of crypto investing. Chain Analysis analytics firm statistics indicate that in 2021 alone, the NFT marketplace hit $41 billion, an amount close to traditional art sales in 2020. Investors are willing to pay ridiculous sums just to own these tokens, and there are less expensive ones as well.

Consequently, thousands of NFT projects continue to flood the market regularly, many of which are rug pull scams. They explode into the market and fizzle out just as quickly, taking hapless investors’ money with them.

Nonetheless, there is a class of NFTs that are becoming the elite of this crypto sector. These projects are tagged blue-chip NFTs, which get their name from traditional finance. Blue-chip stocks are stocks from well-grounded companies with a record for dependability, quality, and stability in the face of financial volatility.

Likewise, NFTs that have gained a certain reputation based on given criteria receive the tag blue chip. The criteria differ but typically include NFTs that are: original, community-driven, valuable, have utility, historical significance, and are innovative. Some Non-fungible Tokens that fit this de_script_ion are BAYCs, MAYCs, Cryptopunks, CloneX, Azuki, World of women, and a few more. They are mostly popular and costly, although there is usually a way to access cheaper offers by the NFT project creators.

Furthermore, some NFTs are value investments with the potential of becoming blue chip NFTs in the future; these are cheaper to purchase and could yield profits long-term.

As we proceed, you will learn more about blue chip NFTs and how to know whether to invest in them.

Keywords; Blue chip NFTs, Blue chip Non-Fungible Tokens, NFTs, Non-fungible Tokens, BAYCs, Cryptos, NFT projects.

NFTs In A Few Words.

NFTs are non-fungible tokens built on blockchains like Ethereum or Solana. Each NFT has an exclusive serial number that confers ownership on whoever holds it. NFTs cannot be duplicated because they are tracked on public ledgers (blockchain). Unlike other cryptos, which are interchangeable, NFTs are unique, which confers value and tradeability on them.

“The Merge”, one of the most expensive NFTs on the market, sold for close to $92 million. However, there are much cheaper tokens available to the average investor, NFTs that sell for $20- $200, etc. It all depends on your capacity and why you are investing. Virtually anything can be an NFT, including fashion items, metaverse game characters, music albums, tweets, and, most often, artworks. Now, to the obvious question:

What Are Blue Chip NFTs?

Source: eGamers.io

Generally speaking, blue chip NFTs are Non-Fungible Tokens that are popular, well-established, experience low volatility, and have long-term value. A typical blue chip NFT will have the following characteristics:

1. Originality: A blue chip NFT is original and not a derivative of another popular one. As with every project that seems lucrative, NFT projects most times attract copycats. For instance, Lil Cool Cats, a rip-off of Cool Cats, and Lil Mutant Apes, a baby-themed version of the Mutant Ape Yacht Club project. Most of these projects rarely last beyond the short term. They typically rise meteorically and then crash just as spectacularly. Blue chip NFTs, in contrast, have track records of continued value and maintaining their worth.

2. Community-driven: one quality that tells you an NFT project is blue chip material is if it encourages community. Projects like Bored Ape Yacht Club NFTs, for instance, offer exclusive membership to BAYC holders. Members of the club have access to a private discord chat room and many other freebies.

3. Historical Significance: As always, any project that has proven itself over some time earns the investors' seal of authenticity. This behaviour is also true for Non-fungible tokens. Once an NFT project can maintain its value, resist market volatility and earn investors' trust, it qualifies as a blue chip NFT.

4: Utility: Blue chip NFTs have utility beyond being collectables. The utility could be club memberships like the aforementioned BAYC, exclusive airdrops, ownership of game characters in metaverse games, etc. Azuki, one such project, is about to launch a private shop for its NFT holders.

5. Long-term Value: investors who can hold NFTs long-term will enjoy great returns when they finally sell them. Although short-term trading in NFTs is profitable as well, Blue chip tokens are more profitable long term.

NFT Projects That Are Considered Blue Chip Projects With Statistics.

• Bored Ape Yacht Club and co: Yuga Labs, the creator of this project, also has a few others to its name, including Mutant Ape Yacht Club, Companion Dog, and Ape Currency. This project has consolidated its space in the crypto space. It boasts a membership that includes numerous celebrities such as Jimmy Fallon, Neymar Jr, Eminem, etc. At launch, the Bored Apes collection sold at 0.08ETH; now, the floor price is around 85 ETH. BAYC currently has a floor cap of 855,000 ETH ($1.5 billion), ranking #1 on NFT Price Floor.

• Cryptopunks: this PFP collection of 10,000 NFTs is the flagship Non-fungible tokens. It influenced nearly all other NFTs, proving its historical significance by becoming a sort of status symbol for its collectors.

• Azuki: Azuki NFTs bestows exclusive rights to fashion collabs, live events, and exclusive airdrops to its holders. It is a community-driven project that aims to provide a platform for artists and web3 supporters to build a future that is decentralized.

• Other examples include CloneX, World of women, etc.

Source: NFT Evening.

How to Determine If Investing in Blue Chip NFTs Is For You?

To figure out whether to invest in blue chip NFTs, you have to consider the following:

1. Prices: As stated earlier, blue chip NFTs can be on the high side. So, if you are looking for medium or low investment options, blue chip Non-fungible tokens are not for you.

1. Long Term versus short term: investors who are looking for quick returns on investment would do well to avoid blue chip NFTs, as they have a slow appreciation rate due to being established. However, to those who can hold them for long, blue chip NFTs bring great ROI.

1. Stability: Blue Chip NFTs are low in volatility, which makes them excellent for investors who have a low-risk threshold.

Finally, A low-cost alternative is to go for value investments that have the potential of becoming blue-chip based on the characteristics listed earlier.

In Summary

Blue-chip NFTs are well-established Non-fungible Tokens that have utility and can weather the inevitable ups and downs of the marketplace. They are well known, good for long-term investments, and deemed safer and more stable than most other NFTs.

Author: Gate.io Observer: M. Olatunji

Disclaimer:

* This article represents only the views of the observers and does not constitute any investment suggestions.

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