Guide on Purchasing NFTs for Canadians – Forbes Advisor Canada
Like many things in this world, the value of an NFT is in the eye of the beholder.
This doesn’t mean that NFTs can’t fetch a hefty price. For example, in addition to “The Merge’s” $126.7 million CAD (91.8 million USD) price tag, Beeple’s “Everydays: The First 5000 Days” sold at auction for $95.9 million CAD ($69.5 million USD).
“The value extends from the authentication and the uniqueness,” Ozair says.
But not all NFTs come with a hefty price tag. Some are valued at less than a dollar. According to data from CryptoSlam, the average price among the $893 million CAD ($647 million USD) in NFT sales in July 2022 was $159.03 CAD ($115.15 USD).
Like with a painting, the market itself will decide the final value. Obviously, not every painting sells for $1 million, but some people believe some paintings might be worth that much. So, they’re willing to pay that price.
Of course, NFTs don’t have to be art. There are also sports NFTs, which include digital variations on trading cards and highlight reels. For example, a picture of LeBron James taken by Kimani Okearah sold for $29.8 million CAD ($21.6 million USD). MLB Champions blockchain-based baseball game sold for $29.4 million CAD ($21.3 million USD), while a signed card of World Boxing Council (WBC) middleweight champion, Jermall Charlo, went for $26.3 million CAD ($19.1 million USD).
Virtual land, which is space in the metaverse, can also be sold as an NFT. In the metaverse, however, NFTs can also include accessories for users’ virtual avatars like images and clothing, says Jerry Eitel, partner emeritus and chief metaverse officer at global accounting firm Prager Metis.
As the world becomes increasingly digitized, NFTs could even represent a deed to physical property, a user’s medical records, proof of ownership, or proof of attendance. These things may not be as easily transferable from one owner to another, but they could each occupy their own unique space on a blockchain.
Of course, buying an NFT isn’t like buying a stock or putting cash into an FDIC-protected account.
There isn’t a guarantee that the price of an NFT will go up. That means investors need to take time to understand what they’re buying when they buy an NFT and to consider what they believe the value of that NFT will be.
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