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https://medium.com/@mikeyd/nfts-arent-as-stupid-as-you-think...
>[...] Net of all that, here are a few things I think a crypto-curious person should think about:
>You must truly understand that these are valueless, greater-fool assets. Their “fundamental” valuation is zero. Trading them is gambling.
>Are you sure gambling is what you want? Prove it. Go to the nearest casino, which I’m pretty sure can be done over lunch anywhere in the US, take a thousand dollars (or any amount similar to a bet you would make on the NFTs you’re looking at) and put it on the roulette table. If you lose and hate it, or if that sounds like something you would never do, then you’re going to hate crypto gambling, too.
>Don’t believe anything you read in the press. Those “hundreds of thousands of dollars for a tweet” stories are almost all fake. Crypto shills are selling these items to themselves for massive price tags to manufacture those stories. This is called a “wash sale”, and it’s also done, illegally, to manipulate stock prices. Even stupider are stories with eye-popping numbers for “transaction volume” or “market cap” for crypto assets. These are manipulated so easily that they are meaningless concepts in this world.
>With anything else you read, look for conflicts of interest. Nearly everyone hyping crypto has already bought in, and they can’t get their money back out unless more people come along and buy in. Or else they aim to make money on the gold rush itself, in the picks-and-shovels way. That’s what’s up with all the TV ads.
>Consider whether you might as well gamble with penny stocks (aka pink sheets, aka OTC issues). Your brokerage account probably has them, the transaction costs will be orders of magnitude lower (increasing your win probability), and you eliminate the chance of getting ripped off by any of the dozens of scams rampant in crypto wildcat banking. The number of people and dollars participating in the crypto market is much smaller than it appears. About 97% of bitcoin transactions are transfers between exchanges, or “tumblers,” which are pointless shuffles among wallets meant to make money untraceable. About 67% of NFTs never have a “secondary sale” after they are created. (This data is old, and it would be interesting to see an update.)
>Are you an artist being pitched NFTs? If your would-be crypto partner is putting up all the fees for opening accounts, funding wallets, and minting costs, then go for it! I can’t see why not; you have literally nothing to lose. As presently implemented, you are transferring none of the rights to your work by selling an NFT. You can sell the same one again tomorrow, or sell the original work in any other forum you might have. On the other hand, if your would-be crypto partner is proposing that you pay all the up-front costs, then be aware that few artists ever make that money back. It’s no different from the vanity-gallery type of scam that you already know.
>So, at last, that’s my advice for Arthur and Danny in Arizona, and everyone else in my Facebook feed that is accustomed to working for money and wondering if they’re a sucker for it. There’s no reason or justice in our high-finance casino economy, so that’s not what this post is about. Crypto just isn’t a high-expected-value bet.
>Most people gambling on crypto are going to lose money. Not all of them. With a boring old index fund, most people are going to win. Not all of them. I’m not touching crypto stuff myself, not even to short it, since that’s just another gamble. If you know all this and want to play, then have at. There’s nothing else to know.