NFT and Crypto Investment – Should We Be Investing or Observing?

Whether you’re a proponent and an advocate for digital currencies or are simply observing the market as an interesting phenomenon, its appeal cannot be ignored. NFT and crypto investment opportunities are appearing seemingly out of nowhere, with over 10,000 cryptocurrencies according to Statista, and just as many if not more NFT collections out there.

The question remains, however – should we indulge in NFT and/or crypto investment or continue to observe the market and simply leave things at that? The answer to that question is more complex than a “yes” or “no”, which is what we’ll aim to expand on in the following segments.

Riding the Hype Train

There’s no denying the hype surrounding non-fungible tokens and cryptocurrencies in the online discourse. Whether we discuss Bitcoin (BTC), Ethereum (ETH), or any of the thousands of coins, or, turn our attention to NFTs, we’ll come across both promoters and detractors in every online thread or forum.

What most people use in their argument’s defense is the fact that both of these digital goods are highly volatile in their market value. According to CNBC findings from May of 2022, both BTC and ETH fell by 6% and 7% respectively, seemingly overnight, dropping the coins’ value for their owners but making them more affordable for new investors to hop on board.

If you’re an investor – great! This means that you can buy new coins from someone else and keep them in your digital wallet until the next time the coin fluctuates. If you’re an owner – too bad! Your coin just lost a percentage of its value due to any number of socio-economic factors outside of your personal control. The volatile nature of both NFT and crypto investment is something that its supporters are actually citing as a great reason to own them in the first place.

NFT and Crypto Investment Fact Check

There are undeniable pros and cons to engaging in NFT and crypto investment, at least from an academic and theoretical standpoint. As we’ve mentioned previously, investment decisions should not only be made based on factual, real-time market information, but also with the help of a financial advisor who is intimately familiar with the market. What are the pros and cons of digital currency trade and can they sway you one way or another in terms of investing or observing?

Pros

• Both NFT and crypto rely on blockchain technology to keep trade transparent and safe
• There are potential payout rewards related to the initial risk of investing
• You can trade one crypto coin for another easily thanks to the digital wallet technology
• You can engage in the crypto investment and NFT trade around the clock, worldwide
• Both digital goods are under no governmental or financial institution overwatch

Cons

• There is a high skill and knowledge barrier for entry for informed investments
• NFT and crypto are both highly volatile and often unpredictable
• Both technologies are plagued by scam artists who are looking for newbie investors
• Losing your digital wallet’s key means losing all of your funds permanently, irreversibly
• Despite their pros, NFTs and crypto are still problematic as long-term investment solutions

As with any trend or a piece of technology, discussing these two is difficult without raising concerns or mentioning the obvious praises they truly deserve. There are both upsides and downsides to engaging in NFT and crypto investment, so it’s up to each of us to decide for ourselves whether we want to have a stake in the market or not.

Most importantly – these decisions should come from our own self-reflection and decision-making, without letting malicious third parties or “too good to be true” deals come in the way of logic and informed decisions. Only by acting in this way will we be able to manage our Financial Wellness adequately and take full advantage of the funds and savings available to us.

Through the Proverbial Looking Glass

Mark Mobius, who is a prominent global investor, spoke on the topic of crypto in a live interview, stating that “It is a religion, not an investment”. Meaning, that both NFT and crypto investment is something of a lifestyle choice for its proponents who are indulging in spending real-world money on new purchases and/or mining because of the “high” they get from doing it.

If you’re not in a position where you have disposable income available for these kinds of purchases, however, more objective and informed investment decisions should be made to maintain your Financial Wellness in the green. Letting hype determine whether you’ll place your hard-earned money into a volatile digital currency in hopes of turning a profit isn’t something you want to bet your life savings on.

Contemplating NFT and Crypto Investment

Are you on the fence on whether or not you should engage in NFT or crypto investment? The best way to know whether you’re ready for an investment or if you’re content with simply observing the market is by visiting a popular cryptocurrency exchange market such as Binance or an NFT market such as Open Sea.

If what you see there sparks your curiosity and you’d like to find out more, do some academic research on the topic and see if you can find value in investing. Meanwhile, here’s what we’ve learned about investing and observing in regards to these digital goods:

• NFTs and crypto are powered by the same safe and transparent blockchain technology
• Both digital goods have objective pros and cons attached to them
• Many global investors and public figures have strong opinions on NFTs and crypto
• Investing in either without consulting a financial advisor and thinking long-term is a bad move

As someone who may be a newbie in the NFT and crypto investment market, you should tread carefully to avoid causing irreversible damage to your Financial Wellness. Assume the role of a curious onlooker and see what you can find out about either of these investment opportunities. If anything, you’ll learn more about trending digital market topics which can help you spark new conversations with your friends or colleagues.

This is Part 4 of our Mini-Series on NFT/Crypto. Stay tuned for the following parts in our journey through the blockchain as we explore trending topics and answer the most pressing questions regarding NFTs and Cryptocurrency.