Lessons and Tips for the Slow Solana NFT Market

Right off the bat: despite the phrase being tossed around a lot, to me it doesn’t really feel like we’re in a bear market. It feels more like we’re going sideways and consolidating for a while, which is fine.

The drops in the value of my NFT portfolio are negligible. Let’s have some perspective: this dip is nowhere near the destruction of the 50% crypto crash followed by 3–4 months of misery (and likely more months to come) we are currently experiencing on that side of the market.

The NFT market has more or less followed the same drop as the macro economy with inflation and the Ukraine/Russia conflict. But there are positives to be noted. Here’s an overall chart from CryptoSlam:

Yes, total volume is down in line with the macro economy. But the network effect is moving forward: unique buyers and total transactions are both still showing progressive month-to-month growth. And that spike in growth for all metrics is showing solid retention strength vs. the relatively flat time period between November and December (before you get too excited, it’s the same on Ethereum and not just the case for Solana).

This does not scream “Panic and everyone off the ship!” to me. It’s just a pause. In the meantime, here are specific actions and lessons we can absorb to get organized and stay positive as we move towards the excellent stuff on the horizon.

Sorry, I Wasn’t Paying Attention. What Happened?

Because my strategy is based on long-term holds for quality projects (in and out of gaming), this down phase of the market doesn’t affect me at all. The profit scaleout timeframes for most projects I hold are still in Q2, if not Q3.

In fact, I honestly hadn’t even recognized this was a bear market until the phrase and vibe started popping up everywhere. My funds are in projects for their long-term vision and work they’re putting in to reach it. So a small lull doesn’t matter: I’m nowhere near peeling off profits for any of my holds.

Except one.

Invest Today for Tomorrow’s Profits

DeGods is the buzz of Solana right now, still pumping in this environment and it seems as if every other Tweet in your timeline is going bonkers about the steady rise of the project.

It didn’t come out of nowhere. It was because they were building while everyone was sleeping on them. The big pump everyone wishes they had gotten in on was not exactly done in secret.

First, major props to SolanaKit for putting together elite level tools that I was able to use for this chart. Also dear reader, please forgive my 3/10 chart labeling skills — I’m sure a few things are off but you get the general point.

This DeGods pump wasn’t done in the shadows under cloak and dagger. The evidence and proof for what was happening was right there, and gave buyers plenty of time to get on board before the rocket ship took off. The team was building piece by piece.

Look at all the stuff that happened right after the Magic Eden launch! And even after $DUST staking went live, the price ranged between 7.5–9.5 SOL for about twelve days.

That’s when I bought my last and most expensive DeGod at 8.4 SOL. It was my second biggest secondary market purchase and a big risk for my budget, but I’m a member of the community. I knew what I was seeing and I knew where it was going more than the rest of the market that didn’t have the same first hand perspective. And I wanted one to flip when the market heated up so I could retain the rest of what I hold for more profits down the road.

Soon after, the Nuked Ape auction showed the first big use case for $DUST, bumping the floor up to around 15 SOL for a few days. Once Frank went on Mark Colcer’s podcast, the rocket was fueled and took off.

This kind of public information with the added benefit of insider knowledge context is something anyone can do with a project. If you have an ear to the ground, you’ll know when the rocket is fueling up before everyone else.

So If you’re having DeGods FOMO in Q1, tip your toe into the water with a small investment into the projects quietly building now that could have their DeGods moment in Q2 or Q3. Accumulate more as they move towards their vision and meet your expectations.

I always have a bunch of projects where I only hold 1–2 of their NFTs for a starting point. This gives me access to their Discord and all announcements/progress reports so I can act on pending developments. This provides me with valuable information to front-run accumulation before the overall market outside the community catches up and raises the price.

Finding great teams making awesome stuff is a lot easier than you think — the work is right in front of your eyes. When you do buy in, stop caring about the floor price. All you need to do is pass the marshmallow test and have patience. Dump when the project isn’t building, accumulate if it’s moving forward. Everything else is noise.

Let It Happen

Right now, other than the occasional check-in for a chance to scale in more, I’m just hanging out checking on the seeds I’ve already planted. If the people running the show are doing their part to water them and I see the growth, I know I’ll get my share of the fruit I can bring to the market. For sure, do your part as a good community member, but otherwise let the people on the project do the job you’ve trusted them to do when you gave them your money.

Yes, the speed of advancement in NFTs is remarkably fast, but the speed of price action is usually slow. For reference, see that twelve day gap above between $DUST going live and the first pump for DeGods. Absolutely keep up with trends, but know that more often than not, you’ll have plenty of time to buy into a project or scale out.

In crypto, a crash is a violent fall that can obliterate 50% of your capital in ten minutes. But a crashing market for an NFT project is like a boat slowly heading for an iceberg. You should be able to see the disaster coming and have plenty of time to jump off. Or at the very least, hedge your bets by scaling out a bit (you can always scale back in later as they move forward).

Chill! There’s no need to go crazy rearranging everything. This is the time where less is more. Wu Wei that shit.

Organize Your Discord Folders

Short and simple: spend 15 minutes to organize your projects in Discord. It’ll save you a lot of headaches.

For example, I use “Holdings”, “Minting Soon”, “Whitelist”, projects I don’t hold yet but want to check in on, and Applied for Whitelist through my core communities.

DO YOUR TAXES

Yes yes, I know. “Taxation is theft” and you’re in the small minority of enlightened people on earth who know that Bitcoin will bring true salvation to humanity or whatever.

I’m good. You don’t need to explain it to me, I’m familiar with the story.

It goes something like this: Satoshi came down from the heavens and in his mighty, generous benevolence gifted upon us the truest form of value known to mankind in the form of Magical Internet Money. It is written and shall be so that Bitcoin will decimate the oppressive powerful invisible forces in our society, free the shackles of humanity’s slavery and bring forth eternal redemption. After blessing us with his holy sacrament, The Almighty Satoshi returned to the invisible heavens from which he came.

Yet he still walks among us. Watching. Observing.

To show devotion, one must praise the gift of his Holy Whitepaper and read it daily to absorb the pure knowledge and enlightenment within. First thing in the morning and last thing before bed.

Yup. I know all about it. And no, sorry, I’m not interested in your religion. But sure, I’ll take the pamphlet. I can place it next to other ones I got today when the Jehovah’s Witnesses and Mormons came by. Nice people! But you know, not interested. I really shouldn’t open the door when I hear a knock, I just figure it’s my Amazon packages. You know how that goes.

Hmmm? Sorry, say that again?

. . . you want me to take out a second mortgage on my house to buy Bitcoin?! Are you serious?! Look, it’s one thing to pitch me your religion. But when you’re asking me to liquidate all my assets and put them into your church that’s . . . more like a cult.

Do people actually listen to you and do that? Wow. Yeah, please don’t ever come by here selling Kool-Aid or I’m gonna call the cops.

Michael Saylor? You mean the guy who was featured in the Washington Post as the best example of irresponsibility and mismanagement during the DotCom bubble crash?

Haven’t heard his name for twenty years. So now he buys lots of Bitcoin? And he wants me to sell everything I own to buy it too.

You know, you’re not exactly making good selling points here. In fact you’re doing the opposite. How many people are you actually able to recruit with this stuff?

Hey! Listen. Before you leave, seriously. Trying to help. I know you believe Bitcoin will bring the true Rapture of libertarian utopia where we can sell children to lint factories on the open free market to buy a private police force and purchase meat removed from the clutches of evil FDA gubberment safety inspections because “freedom” and all that fun stuff Max Keiser talks about on Russia Today.

But this is now and you still have to pay your taxes.

On subject, remember when Max Keiser tweeted that horrible video of Afghans desperately clinging to a plane and falling to their death in their attempt to escape the Taliban and used it to pump Bitcoin?

It’s . . . almost as if Bitcoin zealots are so smug and detached from reality within their bubble that they can’t help but do Bizarro World anti-marketing that will eventually be the downfall of their “Store of Value”.

I think that’s what they’re calling it now right? I don’t really understand what that means.

Nononono please! Don’t get into an explanation. Nice to chat with you, but I really need to get back to work here.

Whoops. Sorry! Got sidetracked.

Anyway! The IRS is putting a huge amount of funding into crypto tax analysis this year. Your “I lost the $BTC Ledger on a boat” thing is cute, but it’s going to go over about as well as you pressing license plates for $1 per hour in prison while telling everyone they have to put those funds into Bitcoin or they can “have fun staying poor”.

By the way! As I write this, Solana is at $81 and a 2x would go up to a perfectly reasonable $162 range given its history. Bitcoin at 38.5K would need to hit $77K for a 2x.

Just saying! Takes a lot to 2x a $800B marketcap vs. a $26B marketcap for something constantly building new use cases for blockchain innovation in the real world without the baggage of a tribal cult attached to it.

Also I’m getting excellent liquid staking from my Solana! And I use it on a daily basis for stuff because it you know . . . does things.

Okay for real. I’m done now. I promise! Let’s get back to taxes.

Even if you have an overall loss for 2021, DO YOUR TAXES. You can carry some of that loss over to 2022 and save on what you’ll owe at the end of this year. Beyond that, tax software automatically calculates all your transactions to put together the optimal capital gains to reduce what you owe. If/when you do sell your assets from 2021 in 2022, you’ll really want to know your cost basis so the software can minimize your tax burden. And you’ll also be able to track if you hold the asset for a year to lock in long term capital gains.

I’ve probably been through five tax software services trying to find something that works for Solana NFTs, and cryptotaxcalculator.io got there. No plug, not being paid, no affiliate link. I just want you to avoid the pain I experienced trying to find this one as the answer. Solana is so new that other services require a manual CSV import, or the API has tons of issues with pulling in the proper data. CryptoTaxCalculator is the only one that does it competently, plus provides images of your NFTs to better track your transactions.

Don’t get me wrong, you still need to dive in there to manually fill in the blanks where it can’t figure out your transactions. It will suck. But at my current rate it’ll take about 2–3 hours for the NFTs, which is honestly so much better than what I saw elsewhere. Not to worry, standard transactions like what you did on centralized exchanges are easily crunched and require zero extra work on your end.

I’m also planning on keeping my tax transactions updated on a regular basis for this year. This’ll save me a lot of headaches for filing, and has the huge bonus of providing tax harvesting opportunities before the year ends.

Project Alpha: Deep Discounts Below!

Now that you’ve eaten your vegetables with my tax advice and relentless Bitcoin bashing, let’s get to the fun stuff with some alpha calls!

Usual disclaimer: this is not financial advice and I am not listing the projects I’ve invested in with the intention of pumping my bags. The projects that I see doing great work are naturally the ones I’m going to invest in. I’ve also already talked about these a ton on Twitter and in my alpha Discord channels, so no surprises there. I don’t need to pump the bags of great projects. Over time, the best teams pump their own bags as they build towards their end product (again, see the success of DeGods).

Please read my ethical guidelines here. I have no intention of running a BitBoy pump-and-dump by mentioning them because I don’t plan on peeling off profits until their product is fully developed.

Be smart and scale out when it’s warranted. I will sell off any project (even at a loss) if I feel they are not living up to my expectations or if I feel overexposed relative to how they are progressing.

With that out of the way, let’s talk strategy and some of my picks.

Tons of influencers in this space are advocating to sell off the unestablished projects and consolidate into blue chips. Let’s be real: the vast majority of us aren’t going to be able to sell off our holdings and buy a bunch of DeGods (I’d love to get more but I’ve got to stay put at this price), SMBs and Degen Apes.

This is counter to my preferred strategy anyway: I find good projects, scale in over time to increase my position, and let the marshmallow sit there so I can get more later. And as I mentioned above, when you’ve established into the project, you’ll be able to get the alpha on what they’re building simply by being there.

Yes, I think the projects I’ll list below are highly undervalued given what they will accomplish in the future. But keep in mind:

• Patience and the ability to keep your liquidity there for 3–6 months is how to profit off these, or any other project building out a high quality concept. The DeGods pump didn’t come out of nowhere, $DUST took months to concept out and execute and is still not fully shipped with all its core features. If you can’t do that with your financial situation, you should not make these kinds of plays.
• The projects below are just examples of what to look for. There are others not mentioned here that I’ve started to scale into and will continue as they move forward.
• Take this lull to sharpen your skills for analyzing projects. I go into this with a lot more depth here.
• I’ve completed my accumulation of all the projects below. I’ve invested heavily into them and will be keeping my liquidity for the next opportunities that come around with cheap entries and excellent future potential.
• I’m not featuring the projects I’ve heavily invested into that increased in value from my lower accumulation price. Take note: I’m in profits with those bags after months of patience and I’m not mentioning them here because they’ve already pumped on their own and don’t need me to hype them. There are better options with cheap entries today that can provide similar returns in the future.
• Hopefully everything above adds some credence to my integrity! I’m always mindful given the pump-and-dump nature of this space. Trust and a good reputation are earned and not given, and I will always put in the work for it.
• It’s a delicate balance to find when you’re hyping up something you hold. For me, it’s a genuine motivation to inform and shine a spotlight on excellent teams that deserve more volume and attention for what they’re creating.

Sorry for that bit of rambling. I’m just self-conscious about not being like this guy.

Slowly accumulating projects at these lower prices is always my go-to strategy, and it’s even more relevant/valuable in today’s market. You get to limit your downside while stacking investments on your conviction plays/having the ability to scale out when warranted.

I’ll also add that when you’re investing for long term holds, especially in gaming, putting out offers instead of buys can be a great way to get some extra value for your money.

There are a number of projects I’ll casually check in on every week or so to see the cost of rares. If there’s one I like, and if the listing history shows the owner is looking to flip it to get their investment back, it’s a great opportunity to put in an offer below the asking price.

If they’re in profit from their last buy price, be mindful to put in an offer that isn’t insulting to that situation. On a psychological level they’re not going to accept it. And besides that, it’s a fairly insulting play with bad karma.

Enough of all this, let’s get to the good stuff! Undervalued projects you can accumulate on the cheap during this lull:

MetaBirds/Nest Arcade
Current Floor Price: 1.2 SOL

I’ve already covered this project in great detail here, so I won’t go over all of it again.

But! There are updates to share since that blog post went live:

• The team released a playable beta exclusive to holders that tracks your score and will provide you with the $NESTA tokens earned once the IDOs are completed. As far as I can tell, this makes it the first game on Solana providing a currently active Play-To-Earn game.
• Every $NESTA IDO so far has sold out, and the price for these tokens is currently trading around $0.012
• Holders will be airdropped 1,000 $NESTA for each MetaBird they hold.
• Mobile launch is in the works, along with development of three new games.

My current concerns:

• A Flappy Bird style game was probably not the best one to start with. I’ve tried playing it and want to throw my computer out the window after a few minutes. I mean, that’s the whole point of the game. It’s famous for giving you high levels of stress.
• That being said, one of my kids is good at it. I’ve done some math and with roughly 90 minutes of grinding he’d be able to earn $NESTA tokens equivalent to $10 every day. But again . . . Flappy Bird. He doesn’t have the patience for 90 minutes, nor would I let him play it for that long.
• But put that P2E profit rate on the iPad with three new games added? That could definitely do it for him, and earning that much money is huge for a kid his age.
• The community seems a bit disengaged, but that doesn’t concern me too much given the value of what they’re going to release.

Particles
Current Floor Price: 2.18

I’ll just link to my Twitter thread with all the details here.

I bought above the current floor. There were a few days there where it pumped and I could have sold all of it for a solid 7 SOL profit. But that didn’t matter. I do not have two neurons in my brain that flinched then or regret holding at a loss today. Timing pumps and sales for flip profits sounds like a miserable approach for my personal skillset. I have no problem holding projects like this that are just starting to taxi on the runway getting ready for liftoff.

Staking is in the works, which will provide distribution of their $OOO token. It’s not some gimmick trying to come up with value out of thin air, but fully backed by fractionalized ownership of the DAO made up of high-end 1/1 art pieces.

I know nothing about 1/1 art other than the fact that it’s a profitable part of this space with lots of room to grow on Solana. And because I know nothing about it, letting experts put in massive amounts of work while I sit back, kick up my feet and collect passive income is a fantastic proposition.

Knife Fork Spoon
Current Floor Price: 1.99 SOL

I never check the floor for Knife Fork Spoon because it’s irrelevant to consider peeling profits as they keep building like crazy towards a constantly improving product. Not to sound like a shill (because again, I’m not selling mine anytime soon), but this is easily the biggest disconnect I’ve seen in this space between floor price, current value and a team’s dedication towards delivering on their promises.

I’d encourage you to read this blog post for more details on KFS. If you’re lazy, TLDR; mini-games with excellent payouts, live Twitch streams of those games, weekly events with prizes like poker and video game nights partnering with other projects, a community filled with representatives from the top communities on Solana: DeGods, SMB, Degen Apes and the alpha that comes with it and so on. This easily the hardest working team in Solana. What they’re able to produce with a small team is amazing, and the attention to detail is bonkers.

Here, check out this example.

A few weeks back I was watching the Twitch stream for one of their Dinner Party events. While I was waiting for my utensils to step up and do battle, I noticed something.

The NFTs in the collection all face right. So they made additional copies of each flipped left for these Food Fight streams, which ensures they’re both facing each other during combat.

I couldn’t believe it! This wasn’t a detail they ever advertised. But to me, it’s a perfect example of how much effort and pride they put into their work.

To continue bringing value to holders they’ve released Spoonverse: a platform that allows any NFT community to use the games on the KFS platform. A cut of that goes back to the KFS team, and in turn will boost the prize pool available for the games KFS runs for its core community.

The second mini-game release currently in testing with more in the works for Q1.

I don’t mean to sound like a shill but I need a deep breath here to center myself after seeing how low the floor is compared to the value they’re creating.

Oh, one more note: when General Sol put together the initial handpicked team for The Sol Army that received free passes, the KFS team got more memberships and higher billing than any other project I’ve seen in that community. That speaks a lot to the reputation and integrity of the KFS crew.

Cubist Collective
Current Floor Price: 1 SOL

Cubist Collective is a project creating an advanced portfolio and market analysis platform for holders. You can check out full details in their whitepaper here. It’s being designed by Micael Ehn, AKA zBanks of the SMB community. He is fully doxxed and holds a PhD in game theory with 15 years of experience in AI machine learning. Taking that level of legitimate high end Big Brain talent and plugging it into a NFT tool has some amazing potential.

While that platform is in development, the project is providing immediate value through a payout of $5,000 to its community every week. This is guaranteed over a six month period (along with its native $CUBIST token) and distributed based on individual contributions in the Discord. You can earn USD/$CUBIST by providing quality writeups with insightful information, and hitting the correct market predictions for polls on market movements like floor prices after a mint.

The promises made are being kept.

I’m not even bummed that I minted at 2 SOL! Because I’m gonna make that back in the three weeks that followed.

So yes. The current 1 SOL floor is crazy considering I legit made more than that amount in one week of contributions, and I wasn’t anywhere near the top for payouts. At its current market price, Cubist Collective literally pays for itself. They also went live with staking this week for their $CUBIST token, which you can read about here.

This is a project where I don’t really care about the floor price at all. It’s just worth it to hold and enjoy what it provides both now and in the future when the core AI portfolio/market analysis tool gets released.

It does help that you know, it’s more or less free and will generate lots of future profit to thanks to six months of weekly $5,000 payouts. And with the nature of that payout structure, conversations are highly organized and productive.

Anybodies
Current Floor Price: 2.2 SOL

There’s a reason I put Anybodies front and center in my article responding to Dan Olson’s critique of NFTs. It is the best example available of the positive things a business can do thanks to NFT technology, especially the cheap, fast transactions provided on Solana. It’s also the example I use with family and friends to explain the future of NFTs and utility.

Again, prominently featured here for all the details as I don’t want to get too redundant. The short version: a brand vision with true mainstream potential offering high-end fashion items redeemable for the IRL version, then transforming into an awesome metaverse version. Confirmed projects integrating those exclusive metaverse accessories include Yaku Corp, Botborgs, Portals, Enviro and teasers for going crosschain onto Ethereum projects.

What I find most bullish about the current entry for Anybodies is that realistically, they’ve only released two clothing items to date: the Anybodies x AF1 Nikes, and Anybodies x DeGods hoodie. They’ve barely even started, and yet the floor hasn’t seen the same drop as other projects.

By the way, I seriously dropped the ball on the hoodie by passing on the 2 SOL mint. That was before this market drop, and it still has a 3.5 SOL floor for the real deal + 1.7 SOL floor it turns into for the metaverse version. At current market prices, you could have minted, redeemed the real hoodie, had it shipped to your doorstep, sold the metaverse version and walked away with an awesome DeGods hoodie to wear for a total expense of 0.3 SOL.

Not that I have regrets or anything as a dedicated early member of both communities.

While the floor drop is there like we see in every other project, it’s not as deep. This speaks to the market actually pricing in the value of its future growth. It’s rare to see that, as the other projects mentioned above are deeper into released features and have floors well below their true value. Anybodies is an outlier: the market has a better idea of what’s to come here and it’s priced in, even with most progress happening in the background.

Embrace Red Candles

Short of World War 3, I think we can all agree that odds are very high we’ll see Solana back in the $200 range this year, correct?

That being the case, it’s a much better idea to celebrate drops in price instead of lamenting them.

I’ve got buy limit orders set at key support levels for Solana. Sometimes they get hit. Awesome! I collect my Solana, tuck some of it away to generate yield, and then it’s . . .

Cheer up emo kids! Solana is on sale. The NFT market is on sale.

This isn’t the crypto market where there are countless variables out of your control and big players looking to liquidate billions of dollars in assets at the blink of an eye.

See quality team working on good project. Invest in that team. Keep tabs on them.

Simple!

DeGods isn’t pumping in a down market because of some magic pixie $DUST (see what I did there?!) It’s pumping thanks to the culmination of creative vision and execution to properly plan, market and release a high quality product for $DUST/DeadGods.

If that rocket can take off to those heights in these foggy conditions, it bodes very well for the rest of the Solana NFT market.

There’s an early narrative I’ve been hearing as the Ethereum NFT community peeks over to check out what we’ve got going on here: ETH is for art, SOL is for utility.

If that’s true, we’re in a great spot to get in early! It’s a hell of a lot easier to invest in utility because the concept, production and effort is right there for everyone to see.

It happened with DeGods, and it’ll happen again with future Solana projects. You’re investing in teams and their ability to deliver. This is all tangible, none of it is based on abstract concepts.

The arrow up there is the day DeGods finally went live on Magic Eden after spending its whole existence on Alpha Art. That’s where you buy into a project and take advantage of the opportunity to accumulate before everyone else figures out what’s up.

Markets are often irrational by nature. Here’s what The Ascent of DeGods has taught us: don’t pay attention to today’s price. What really matters is the team, the community, what the project is trying to do and how far along they are with getting there.

That’s a huge number of moving parts working in unison to make something awesome. It’s a beautiful thing! And that’s what we’re all here for: to chase the dopamine rush for when it all finally comes together to create a successful product, along with the financial rewards that come with it.

The rockets being built right now for liftoff in Q2 and Q3 are in their “You Are Here” phase. The market is being kind enough to give you a big discount on the price to get on board. Make the most of it.