Perhaps you have stumbled upon NFT community posts on Twitter and Reddit, where people share how they have NFTs worth thousands of dollars with literally zero-dollar investments. This may seem like a scam because it is incredible to think that free items could eventually become a lot of money. Most NFT projects will require you to pay upfront fees to mint NFTs; however, free-to-mint NFTs exist, and some have the potential to become worthwhile in the near future. So, the question is, "how do you generate money from these free-to-mint NFTs?
In truth, paying to mint an NFT doesn't guarantee a successful NFT project; hence, NFT projects that involve upfront fees aren't inherently better than free mints. The factors that determine how far an NFT project will go, do not emphasize much on their initial cost as much as their roadmap, utility, and social media reach. Hence, this article will show you how to generate profits from free mint NFTs with almost zero initial capital.
What Are Free to Mint NFTs?
Free-to-mint NFTs are a sort of NFT drop in which projects provide NFTs, save for the gas fees required to mint the NFTs. Most such mint projects focus on secondary sale royalties rather than primary sales revenues. In other words, the team gets a predetermined proportion of royalties every time an NFT in the collection is sold on the secondary market.
Free-to-mint NFTs lower entry barriers to the NFT sector, particularly for newcomers; it is common knowledge that new NFT projects typically demand a hefty fee per NFT, which is not affordable for everyone. Furthermore, NFT sales have fallen, making free mints an appealing choice. As a result, many projects elect to produce non-fungible tokens through free mints, allowing users to participate in projects with no investment.
How to Get Free to Mint NFTs?
Many believe that free items have little or no value; they may have been right previously, but not anymore. With free mints, NFTs have transformed the game. However, NFT free mints differ from airdrops, in which tokens are instantly and automatically placed into your wallet.
One method to get access to free mints is by applying for whitelist spots. The NFT whitelist (or allowlist) is a list of people who have early and assured access to minting NFTs for a certain project for a specified period. Whitelisted users are usually allowed to mint NFTs for free or at a reduced price before the general public can gain minting access.
The nice thing about these mints is that they can help you make a lot of money. Of course, you still have to pay for gas, but it's generally little compared to the potential sums. However, it is important to note that free mints are fiercely contested by many people; hence, you must capture free mints on time, necessitating using the proper pathways to get whitelisted; this process is commonly called "grinding."
How to Make Money from Free to Mint NFTs?
Making money from a free mint NFT is less dependent on your individual efforts and more on the community and project team. If the overall NFT project fairs well, your item from the collection will soar in value.
If the NFT project has an attractive utility and roadmap, it becomes attractive to buyers; hence, with some excellent marketing, a free-to-mint NFT could become a blue chip, where demand would greatly outweigh supply. As a result, the NFTs' price will skyrocket. A perfect example of this is CryptoPunks, which was a free mint; shortly after the mint period in 2017, it could be purchased for prices between $1 and $34. However, with increased popularity and demand, the collection developed some clout, and Cryptopunks became wildly valuable. Currently, the most expensive CryptoPunks NFT was sold at 8000 ETH ($23.7m) back in February, all from a free mint.
Factors That Affect the Price of NFTs
The valuation of NFTs is a significant unknown; developing a credible approach will be vital as the industry grows. Their worth is determined by various components, including but not limited to: ownership history, community strength, utility, and tangibility. Hence, even if an NFT involves an upfront minting fee and fails to satisfy the most crucial market factors, it may become worthless.
For example, when promoting an NFT project, a star artist's wider marketability and notoriety will impact the value of their NFT above that of another, lesser-known artist. Certain NFT producers in the sports business have recognized this and have collaborated with well-known artists to create digital-first, one-of-a-kind material. These NFTs are appealing to customers since they are special and distinct from the sorts of actual goods available for purchase.
Also, the real-world use of an NFT, whether physical or digital, determines its utility. For example, some NFTs are collections that may be used in games as virtual terrains or avatars; this feature of NFTs provides them immediate value, which grows over time, based on the popularity of the underlying project. Hence, as the community of decentralized game players expands, more people will be willing to pay top dollar amounts for unique NFT gaming items.
Some NFTs are linked to tangible items, which give value in terms of physical tangibility, together with traceability and ownership immutability. You may use an NFT to consolidate ownership rights, but this does not make the object unique or in great demand. The underlying value of such an object will be determined by its practical use and the level of personal happiness it provides the owner.
Also, there are tangible-value NFTs better suited for short-term trading. Examples are items with an expiration date, such as an event ticket; however, other collectibles, such as a limited-edition piece of apparel NFT, might gain value over time. Again, this is because the quantity of products in circulation is decreasing.
Precautions Involved In Sourcing Free-To-Mint NFTs
You should approach every free-to-mint NFT project cautiously. Don't utilize your major wallet with all your principal DeFi and NFT positions to mint from these new projects, as these collections are often released with unconfirmed source codes.
Of course, free-to-mint NFT fraudsters exist, and they often employ malicious smart contracts. When you mint from these projects, you're trusting them not to be malevolent; hence, using a different wallet with restricted money, maybe gas fees alone, is preferable. Suppose you are involved in a malicious contract, you will be insulated as it will be from a wallet you've put up specifically to potentially be attacked, and it will minimize the harm accordingly.
Regardless, standard practices, including triple-checking smart contract sources, keeping important assets in cold wallets, and understanding how to recognize NFT red flags, should help collectors avoid free mint scams just as effectively as any other. Lastly, if you ever do mint free-to-mint projects and their floor rises, you don't want to keep your NFTs in your mint wallet for too long in case it is subsequently attacked. So, instead, return your winnings to safer pastures, such as your primary hardware wallets.
Yes! You can make money from NFTs without any capital save some meager amount of gas fees. As said earlier, paying for an NFT mint doesn't guarantee success, but many more factors, as listed above, determine the future of an NFT project.