How to invest in NFT projects, refer to seven indicators
The recent rise of NFT has driven the price of Ethereum to rebound from a low point, and both its popularity and activity have surpassed DeFi. How to choose the NFT project, refer to the following data analysis:
1. Estimate the market value
Calculation method: 7-day average price * total supply
Reasons for choosing this indicator: Compared with homogenized tokens, the liquidity of the NFT market is generally lower, and the transfer speed is much slower. This indicator is useful because it removes outdated input data (for example: early cryptopunk sales)
Recommended tools：@raritytools
2. Diamond hand balance
Note: Diamond Fingers are not afraid of market fluctuations and hold positions until the target person.
Balance calculation method: The total amount of NFT belonging to the address of any NFT that has never sold a given collection.
Purpose: A useful indicator for identifying projects with true long-term believers.
Recommended tools: @nansen_ai
3. The sole holder
Purpose: To help understand the size of the project community
Recommended tool: Use the @drakedanner dashboard on Dune Analytics
https://dune.xyz/danner_eth/NFT-Comparison
4. Transaction volume
Purpose: To understand the basic but important indicators of the overall market demand of the project
Important note: The indicator should not be used alone, because it can be used by whales. Use with unique address (above)
Recommended tools: @opensea
5. Rarity score
Reason: All things being equal, if you have no preference for aesthetics, NFTs with higher rarity scores are usually more valuable than NFTs with lower rarity scores.
Recommended tools: rarity.tools
6. Floor price
Reason: A useful indicator for monitoring the cost of users joining the NFT community
Note: Anyone can also use similar applications (such as @fractional_art) to join the high-level community
Recommended tools: @Zeneca_33’s Google Sheets
7. Qualification Assignment
Purpose: To show the distribution of NFT ownership over time
Why: Knowing which NFT projects have long-term community attention is a useful indicator.
Recommended tools: @nansen_ai
