How to Price Your NFT: Key Things to Know When Setting Price for Fresh NFTs
The question ‘How to price your NFT?’ is a burning one for many, and there is no exact and universal answer. Establishing the right floor price is vital, and, in some ways, it is based on the blockchain the NFT is created on, as well as the planned supply.
In addition, it will always depend on what kind of an NFT project you are creating and what your primary goals are.
But it’s not only about types of collections – one must compare themselves to the same-level peers to set an adequate price and have the right reference point. In this short guide, we are overviewing a few main price-forming factors that decide how to price an NFT in the most optimal way. They include:
- Real scarcity
- Demand (desirability)
- Hype and marketing
Next, we will break these points down for you to understand more about how to price an NFT in the current market conditions and answer the question ‘How to price my NFT?’.
How Much Should I Sell my NFT for: How Price Depends on Token’s Scarcity
On the one hand, it is all subjective when pricing unique tokens and collections, but the actual scarcity is also considered. On the other hand, when an NFT has rare traits and represents a relevant idea being short in supply, it influences the value so that the price grows.
This is seen in the contrast when a token with common traits sells for less than a rare one. So, from the point of view of a creator asking ‘How much should I sell my NFT for?’, it is logical to sell a rare token for a higher price or put it in an auction.
How to Price an NFT With Superb Utility and Real Word Use Cases
Another point that makes sense to look at when asking how to price your NFT is the contained utility.
First of all, make sure to research the concept of utility along with other price-forming agents for an NFT. The term utility is thrown every time when a token is on the pricier side. But what exactly does it mean, and how to price your NFT art then?
In short, the utility can be anything from generating returns to giving access to exclusive events and materials for token buyers. In some cases, utility is more obvious than in others (access to conferences or meetings, etc. ), while in others, it is more of a subjective use.
Anyway, the perceived utility is currently one of the predominating factors that play a role in price formation. For example, if your token offers some kind of unique experience or an opportunity for a holder to grow and develop in the sphere of technology and art, then you can call it a utility and see how other similar projects are priced. Then, you are more likely to set an adequate price for the NFT and the whole collection.
How to Price Your NFT Art If It Holds a Promise of Return
Yes, there is also this type of non-fungible token. It usually is not supposed to increase in price over time but generate a particular income instead, such as profit from being used inside a metaverse game or ecosystem, etc.
Some projects, such as Genesis Kongz, contain a limited number of NFTs with special value in the network. As a result, they are of limited supply and this demand, in turn, helps the tokens acquire a competitive market price.
Besides, it is a point that plays for the benefit of project developers because the higher the price of a single NFT like this, the more valuable the project gets.
How Much Should I Price my NFT: How Token’s Attractiveness, Hype, and Speculation Influence the Price
Okay, now, there are 3 more points to have a look at: the token’s attractiveness, price speculation, and the marketing work that makes it sell better. All of them are quite interconnected.
Since NFTs are both a financial and cultural phenomenon, their value directly depends on how their authors are perceived, what themes and associations are attached to them, etc. In other words, it is about individual perception and the desire to own luxury and unique item. It also gives an NFT holder a special status and makes them a community member, which has strong psychology behind it. This is the major part of the answer to ‘How much should I sell my NFT art for? ’
Still, not everything rare will be popular in our society, so it depends on which motives and topics are booming now, as well as what eternal value the token carries.
Next, the price is set depending on the hype, especially when a collection on a new topic is to be priced. Now, even though it is challenging to give an answer to ‘How much should I price my NFT collection?’ if nobody has made a similar one before, authors can be bold enough to set a high standard and convince investors of the worthiness of their projects. To be honest, here, the ‘herd effect’ and FOMO can come into play too.
Lastly, there is speculation that drives short waves of price movement. We can’t miss short-term price fluctuations when thinking, ‘How much should I sell my NFT for?’ for a few reasons. For example, there are day traders who don’t care about your NFT’s real world uses and just want to buy and sell it while the hype is sky-high.
So, if your fresh made NFT has anything to do with the factors we described above, and you are thinking, ‘How much should I sell my NFT for?’, take them into account to make up an adequate price, not too high and not the one that would depreciate your efforts and talent.