Should You Invest Time into NFTs? — NO. Here’s why
First off, I’m not the usual NFT hater from the online-“art” community, nor am I a blockchain and NFT fanboy. I am a skeptic who does try not to judge prematurely before investigating things more and tipping my toes into the water.
My Own Experiences with NFTs
I did my plunge into NFTs in the second half of 2021. It was peak buzz around the whole topic. Good old times. In my experience, this is usually already too late to have a first-mover advantage financially. Especially for things that grow so explosively. What comes up exponentially, has to come down eventually to a sane level before it can sustainably develop. That’s just the nature of bubbles and hypes. But even a bubble does not mean that something is useless, just look back at the internet in 2000.
I tried to enter the NFT market and do it as ethically as possible and find ways to justify it to myself. After running two experiments, and collaborating with some people in that space I am more convinced than ever that it is a waste of time for 99% of people who are serious about art.
I observed two main effects that it had on me:
What is my experience
- A decline in creative output
- A decline in mental well-being
Let me dive deeper.
Publishing a Collection on OpenSea
My first attempt was to release a collection of 21 hand-made SVG landscape illustrations — Serene Scenes. Each scene represented a world with a distinctive peaceful, serene or nostalgic mood.
Publishing on OpenSea was like trying to make yourself be noticed by big ships on a tiny deserted island.
I was releasing each illustration one by one, to build a sense of progress over time and to have a continued stream of updates.
Pretty soon I found out the hard way: Nobody cares about my NFT collection. It’s just one of millions. It is not valuable to people, because there is no speculative value to them. I’m essentially a nobody with no devoted following. I had around 2,000 followers on Twitter at that time, most of them not very active. I guess there are maybe 20–50 genuine followers interested in my work or me as a person. The overlap of these people with NFT as interest was in single digits.
When I saw that nobody cared about my NFT art itself, I decided to not only have the landscape illustration, but also write a small and unique story for every place. That way, I thought, people are not only buying an illustration, but also a world, a potential story.
But still nothing more than crickets. I honestly think, nobody noticed with all the noise, except for my friend who was supporting it in the first place.
Essentially, this is when the secret to successful NFT collections dawned on me.
The two main factors of NFT success
What makes an NFT successful? It is not all that surprising when you think about it. The two factors are:
- Being already famous
- A large community
Being already famous is the easy step. Just be already famous and your NFTs are more likely to sell well. It also means that you probably have a lot of artwork lying around that can be uploaded as NFT. If you are not at the stage of being already famous, don’t worry, there is still option 2.
Let’s follow down this rabbit hole a little, and then see why this is a problem.
Building a community
What kind of community do you have to build? A devoted community that believes in your NFT project, your goals, your visions for it, and first and foremost, the potential to become the next Crypto Punks or Bored Apes and make them a ton of money from their initial investment.
For that, you need to build a discord, have lofty unachievable dream goals, a fancy website, and essentially build a cult around your project.
Let me dial down the cynicism a little. It might not look much different from other crowdfunding. Kickstarter in its early days had a lot of bad apples. Projects that have never seen the light of day. Startups also very often iterate a lot on hype and goals that might seem very unrealistic.
At least people who invest in startups are already rich and know the risks. Additionally, there are large Venture Capitalist companies (VCs) to analyze those startups and mitigate the risks. It’s not random folks from the street who put their life savings into it. Let’s not talk about ICOs here; another Blockchain topic that was supposed to democratize startup funding.
Building a community is its own skill. It takes a lot of marketing knowledge. And if you have been on social media you have seen: NFT marketing was noisy, obnoxious, and everywhere all at once (great movie)!
If you find posting daily on Instagram tiring, then this is not for you.
I approached the entire NFT project from an artistic perspective. I thought, maybe this is how I can fund bigger and better things as time progresses. Instead, the marketing aspect took over and I was just thinking about, how can I get visibility for this project in this over-saturated market. All this took so much of my mind space, that I very much dialed down most of my creative output.
This led to creative burnout in a way. I felt demotivated and almost unable to create anything of value for myself.
Building a community is just not something I wanted to do. A million destructive questions were circulating in my head.
Why does my art need a community behind it on a discord channel, where followers can discuss how rich they will become once it blows up, to have any value? Why would anyone interested in creating something people can enjoy, be interested in building such a community? Since when is a measure of how much money you can make with something a measure of how good it is? Why does everything I create need to be a commodity to be traded?
I want to create art. I want to earn money with it. But I don’t want money to be the only value my art has.
A more positive experience
Parallel to the OpenSea collection I also tried publishing a couple of NFTs on a smaller, lesser-known platform — Hic Et Nunc. The platform was discontinued, but it lives on at Hic.af and objkt.com. It was less lucrative, but the way I approached it was different. I just wanted to share the work I did and allow some of my followers to collect it. Kind of like a trading card of my achievements.
Simply selling personal work without the intention to make big bucks felt more rewarding overall.
I felt more like people were buying it because they liked the art and wanted to support me. And less as an investment scheme. It felt like they were giving me a “LIKE” with a couple of bucks attached to it.
Trying to market my art and make it seem like it would be worth 10 times more soon felt inherently shady from the start. I thought to myself: “Why else would someone want to invest $200 into my art if it didn’t have the potential to bring them back the returns?”
It felt more genuine from the smaller community when people could acquire a token of my art for $1-$5. Mostly other artists bought my tokens. Artists I knew from Twitter already. It was nice to get to know this part of the community.
It had some appeal to it. It was like collecting trading cards of your favorite art from the people you like. I think there is potential. Social media can learn from it.
Was it ever a significant amount of money? Not really.
It just felt like artists are moving the money between each other as a zero-sum game.
Conclusions
Ultimately, NFTs are still clunky, hidden behind very un-accessible interfaces and currencies, riddled with scams and shady figures trying to steal your wallets.
The good platforms are not in any way better than other more secure crowdfunding systems like Patreon, Ko-Fi, or buy-me-a-coffee.
A lot of NFT hype boils down to FOMO (fear of missing out). It was a reason why I was intrigued to explore it.
FOMO is rarely a good advisor in what you should do. In general, fear is usually not good advice in any financial or career decisions. FOMO is a side effect caused by the fast lives we are living, full of information overload through social media.
If you truly want to grow as an artist, NFTs are a distraction at the least, and huge energy and time drain at the worst, even without considering the controversies around it.
If you are already a big fish with a large following, well go ahead and make some quick bucks, but please inform yourself at least and try doing it on a blockchain that does not burn up a bunch of energy.
If you are interested in the different ways you can make money as an artist, follow me as I explore this topic further in the future!
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