NFTs, Investing, Analysis

2022: Year of the High-$$$ NFT Mints— Looking at the Math on a Few High-Profile Upcoming Drops

There’s going to be a LOT of ETH floating around in 2022, and for good reason.

In mid-2021, I was discussing pricing for a planned NFT drop with a potential generative art and smart contract client. We got to talking about all sorts of pricing strategies, and about market dynamics in general. At the time, we’d all seen a number of projects that minted out around 0.05 ETH to maybe 0.1 ETH, but soon after minting (usually before the reveal) ballooned up to like 0.5 or even 1 ETH+ floor prices.

The idea proposed was something like: If the price is going to hit 1 ETH on the floor of a 10k generative set, then why mint it out for like 0.06? Where is the difference — that 0.94 ETH each lying between those two figures — going?

Well, clearly, it’s going to the investors and flippers. The math looks like this:

Looking at a Typical Mint Scenario

Let’s assume ETH at $3,000 for this:

• Set size: 10,000, of which 9,500 mint out and 500 are reserved.
• Revenue: 9,500 times 0.05 ETH equals 475 ETH or $1.425 million USD.