Every single day the NFT market mints a brand new set of millionaires. The challenge for many people is they think if they ape into the hottest new derivative on the Opensea top 15 that’ll be their ticket to wealth. Unfortunately like most things in life, making money takes a lot of work and research. With a well developed system you can make this work a lot easier and start making more educated buying decisions when it comes to your NFT investments. In this post I’m going to give you a quick rundown of my research process. With the right research process you’ll be able to quickly identify target NFT projects and determine if they have a shot at making you tons of fat stacks.
Some pretense here, this is the process I use to identify already minted projects. Everyone has their own investment styles and for me I’d rather get in during the short period after mint where projects are cheap but have had time to establish a community. I find this has the best risk/benefit ratio. Getting in pre mint puts you at tons of risk including a rug pull. Everyone has their own style but this is the one I’ve found suited me best.
- Identify newly launched projects
The first thing you’re going to want to do is gather a list of newly launched projects that are starting to garner attention. For this I use icy.tools. Icy Tools is a great free tool that shows you which projects are gaining volume on a very short time window, down to the hour. This will help you find projects getting attention before they hit the Open Sea rankings. Once one Icy Tools go to the 2 hour window (you can use the 1 hour window I just prefer the 2 hour)
This will give you a list of the most popular projects from the last 2 hours. From here we can start picking and choosing projects to do deeper research on. I start from the top of the list and when a project catches my eye I move on to step 2. For the rest of this blog I’ll use the current project at the top of the list which is Monster Ape Club.
- Check out the website
Once we have selected a project to research we are going to start to want to learn details around the project. This includes utility, style, founding team, and future roadmap. For this example I’m using Monster Ape Club. Upon clicking on their website the first thing I’m going to check out is the high level description of the project as well as the style of the art.
First thing I notice is the style. Another one of many ape derivatives. Everyone has their own investing principles but for me I don’t typically invest in derivatives of other projects. This is clearly a derivative of Bored Ape Yacht Club. Minus one point for me here. Next I look at the high level description. This is going to be their pitch to me on the project. Each NFT is unique artwork with many different traits. It’s about building a community around NFT’s. Honestly, this might be the same description as 99% of NFT projects out there. Nothing really stands out here as unique. They are not doing anything to push the technology forward. Another point subtracted here.
- Check out the roadmap
Next, I’m going to head to the roadmap and see if they have anything unique or interesting planned.
Scrolling through the roadmap it once again hits on all the current landmarks of derivative NFT projects: merch, exclusive social club, and the metaverse. Every NFT project has these 3 things on the roadmap. One other thing that turns me off here is no hard dates at all. The reality of the situation is most projects will have a roadmap and never execute. This is even more likely when the roadmap has no hard dates in the near future. This project has no dates at all, period. Odds are this project will not execute on anything in its roadmap. Another big minus for me.
- Check out their socials
Next, I’m going to check out their Twitter and see follower count and general activity. First thing I notice is the 45k follower count. Something odd I’ve noticed in my time researching is that almost all newly minted projects have somewhere between 30k and 50k followers. I don’t understand this at all. How does a project that just launched that has almost nothing unique about it and only 26 tweets get 50 thousand people to follow it? And almost every single project I look up has this range of followers. I have to assume they’re all paying for followers. This is the only explanation I can come up with. I have hundreds of incredibly clever tweets and I don’t have nearly that many followers (PS follow the twitter). I automatically subtract a point when I go to a twitter and see that ratio of tweets to followers. There is absolutely no way a project this young got a follower count that large organically. I’d rather invest in a project with organic growth. When I invested in Creepz (which has so far been by far my most successful investment, over 30x returns) they had 8k followers and organically grew to over 25k at time of writing. Ironically enough I’d rather invest in a project with 8k followers rather than 35k only because I know they are trying to grow organically.
- Check out their Discord
The last thing I do when I’m making NFT investment decisions is check out the project’s Discord. This will be a big indicator on the strength of the community. Typically you can find the Discord link on their website. Checking out the Discord will tell you just how strong the core of the community supporting the project is. If the Discord is active at all hours of the day with people talking about the project rather than the floor price you know they will be strong holders and not just there to make a quick buck. This also means the community will do a good job evangelizing the project and spread the message organically as well.
After going through these 5 steps I’m typically comfortable making an investment decision. Typically I won’t even get to step 5 and move onto another project. Honestly for Monster Ape Club I probably would have stopped after checking out their website. Derivative profile picture projects just have a very low chance of being successful. I hope you were able to find 1 or 2 nuggets of information in this post that will improve your researching process. If you found anything of use here please sign up for my NFT alpha newsletter. It’s completely free and I regularly send out research reports on new projects and other exclusive insights. Also give your boy a follow on Twitter.