- Research is critical: Check the team roadmap community.
- Verify technical data: Look at supply, volume, and distribution.
- Watch out for red flags like fake engagement or anonymous founders.
- NEVER send funds directly from an exchange to mint an NFT.
Checking facts is crucial when researching NFTs, just like any crypto investment. Each NFT has a purpose—art, gaming, utility—and your job is to figure out what's legit and what's not. Once you have picked a project you’re interested in, follow these three steps to vet it properly.
Step 1: General Information 🕵️♂️
Start with the basics. Does the project look professional and transparent?
- Project Website: Is it unique or a copycat? Does it clearly explain the project's purpose or utility?
- Roadmap & Whitepaper: A legit project will have a clear plan with milestones. Check their website or Discord for this.
- The Team: Who is behind it? Are they public (doxxed) or anonymous? Check their LinkedIn or social profiles.
- Note: If the founders are anonymous, be extra cautious. Look for reputable artists or advisors involved to build trust.
- Partnerships: Are they partnering with real brands? Verify these claims on the partner's official channels, not just the NFT project's word.
Step 2: Technical Data 📊
Numbers don't lie. You can find this data on marketplaces like OpenSea or analytics tools.
- Market Volume: Check the trading volume. High volume usually means high interest and liquidity.
- Supply: How many NFTs are there? (e.g., 10,000). If minting hasn't finished, check how many have been sold vs. total supply.
- Distribution: Red Flag Alert! Check the "Holders" tab. If the founders or a few wallets hold a huge percentage (e.g., >30%) of the supply, they could dump the price at any moment.
- Floor Price: The lowest price an NFT is listed for. This gives you the entry cost.
Pro Tip
Minting Fees: If you are minting a new project, ensure you have enough crypto (ETH/SOL) to cover both the mint price AND the gas fees. Being a few dollars short can cause the transaction to fail, losing you the gas fee!
Step 3: Markets & Community 🗣️
A strong community is the lifeblood of an NFT project.
- Active Community: Don't just look at follower counts (which can be bought). Look at engagement.
- Are people talking in Discord?
- Are the devs replying?
- Do posts get real comments or just bot spam?
- Verified Marketplaces: Always look for the Blue Tick verification on marketplaces like OpenSea to ensure you aren't buying a fake collection.
Don't get phished! Learn the signs →
The Golden Rule of Crypto
Critical Rule: DO NOT SEND FUNDS FROM AN EXCHANGE! Never send crypto directly from Coinbase/Binance to a minting address. It will likely fail, and you may lose your funds. Always transfer to your personal wallet (MetaMask/Phantom) first.
By following this guide, you can filter out the scams and find projects with genuine potential. Remember: if it sounds too good to be true, it probably is.