July 13, 2021
NFTs come in a variety of shapes and sizes. Currently, Nansen offers ERC721 based analytics geared towards NFT collections such as Bored Ape Yacht Club and The Wicked Craniums. Such collections often feature around 10,000 NFTs, with each NFT bearing individual traits making some more valuable than others.
Having traits in common with other NFTs enables collections to foster a sense of community and exclusiveness. Using such an NFT as a social media avatar gives holders added social capital and allows an instant connection with like-minded people. The premium attached to exclusive NFTs has led to a booming collectibles market. Early investors who can decipher genuine innovation from a quick money-grab often reap both the reputational and economic benefits.
From Minting to Secondary Market
NFT collections often begin in a minting stage where users create new NFTs directly from the contract through the project’s own website using a MetaMask extension. Once all NFTs are minted the activity moves to the secondary market. Most secondary sales happen on OpenSea, which is also a good place to check the traits of a new NFT.
NFT collections have developed their own breed of tokenomics with each project developing new quirks and innovations. Here are some key questions to ask when a project is just starting out:
NFT Paradise allows a comparison of NFT projects over the last 24 hours. Nansen’s automated data gives market insight for NFT collections from the moment a new contract is deployed.
What do all these columns mean?
NFT God Mode
Once a user is interested in a particular NFT collection they can click through from NFT Paradise to drill down further into data using NFT God mode.
Of particular importance here is the scatter graph called Individual Transactions. This graph reveals the floor price and confidence level. Floor price is a term used to denote the minimum price any NFT can likely be sold for. Whilst an NFT with rare traits might attract a large premium, the more common NFTs are usually traded at the floor price. As NFTs are not fungible the floor price is an important indicator of how liquid an NFT collection is and the best price for a quick sale. The scatter graph also allows inspection of the most valuable NFTs and again allows a price estimation for potential sales. If you’re curious about why a specific NFT trades at a higher price, click on the scatter graph dot to follow it through to the item profile dashboard.
Top tip: The golden dots in the scatter graph highlight notable users buying and are an indication of the overall reputation and influence of an NFT collection.
In breakdown, you can see who the top buyers are and what they are doing. This is where Nansen’s labels contribute to a deeper level of insight into how the market is shaped. In Top Balances we can see who owns the most NFTs and if they are buying or selling. Clicking a name links through to the NFT wallet profile which includes a further breakdown of all NFTs owned by that wallet. NFT God Mode also offers additional graphs and tables showing historical balances for top holders, smart money and different types of collectors.
At the time of minting Pranksy owned over 1,200 Bored Ape NFTs (over 10% of the market) and has slowly sold many as the collection gains popularity. What happens when that sell pressure ends? We can gauge sentiment in this question by investigating the trades tab and seeing if smart money or legendary wallets are buying or selling.
Nansen specialises in tracking smart money wallets who have previously made savvy investment decisions (denoted by the 🤓 emoji). Recently we have extended a new category of NFT labels based on the volume of NFT transactions by a wallet. More about our labels can be found here.
These are just a few of over 30 features from 4 NFT dashboards currently being developed by Nansen for NFT based analytics. The dashboards come with a hefty disclaimer and are still undergoing beta testing with new features and coverage being constantly developed. You can currently gain access by purchasing an Alpha or VIP subscription at https://www.nansen.ai/plans. Whilst it is certainly not a good idea to follow investors such as Pranksy and dingaling.eth blindly into trades, it may be helpful to understand what key players are doing and how these emerging markets are increasingly shaped by reputation and influence.
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