What are Blue Chip NFTs (and how to create your own blue chip NFT collection)
As the interest in NFTs grows, so too do the profits.
And as those profits grow, so too does the number of people launching their own NFT projects.
Here’s the thing.
There’s a huge divide between the collections that do well and the collections that fail in the NFT world.
I’m going to break down the very best of NFT collections - blue-chip NFTs - and explain what makes them so profitable and desirable for members.
Bear in mind this is just our opinions, and should not be taken as financial advice.
What is a blue-chip NFT?
Blue-chip is a term in the financial world that highlights stock or assets outperforming other assets in the same area.
These blue-chip assets are often more profitable and more stable, thus less likely to suffer in erratic market swings.
Blue-chip NFTs have the same characteristics. They have a higher value than other NFTs in the space, and that value is more stable and not as affected by market swings.
Let’s do a little comparison to show how they work.
Blue-chip stocks are stocks from well-known brands that are generally safer investments for you.
We’re talking the kind of companies that have…
- Very high revenue
- A multinational presence
- Have existed for a long time
- A diversified product offering
- Are the market leader, or one of the top brands in their industry
Blue-chip stocks are basically huge, well-established companies.
The kind of brands that it would take something absolutely catastrophic to ruin or significantly impact their stock price.
A few examples of blue-chip stocks include…
- Coca Cola
Big brands that are well established in their space as the leader.
What are blue-chip cryptocurrencies?
Much like with stock, there are also blue-chip cryptocurrencies out there.
These are cryptocurrencies that are more established, have a higher value, and have survived severe downturns and drops in value over the years.
The list of blue-chip cryptocurrencies isn’t anywhere near as long as the list of blue-chip stocks. However, it’s a list that’s actively growing and could provide incredible investment opportunities for smart investors.
Below are a few examples of the cryptocurrencies that have already hit a similar level to blue-chip stocks in terms of outperforming the rest of the market.
What are blue-chip NFTs?
At their core, the differentiator for a blue-chip NFT is the same as any of the above 2 explanations.
It’s an NFT that outperforms others in the space in terms of value, and isn’t as susceptible to market swings.
Here’s the thing.
There are various methods and approaches an NFT or NFT collection can take to hit blue-chip status.
While many NFTs take the form of visual artwork today, it’s only one of the facets that make a collection a ptentially good investment.
I want to quickly run through some of the common threads between popular, high-value NFT collections (both blue-chip NFTs and those that will likely one day become blue-chip) before showing a few examples.
What makes a blue-chip NFT?
This is the question. Bith for those looking to invest and for those minting their own NFT collection.
Here’s the thing. There is no one solid answer to what makes a blue-chip NFT collection.
Below are a few of the key considerations and value-adds that seem to make a difference with blue-chip NFT creation.
Blue-chip NFTs have desirable artwork
This is a weird one for many.
A lot of people look at the generative NFT artwork and think this is all NFTs are.
For some, that generative artwork is fine and kinda cool (I’m partial to Deadfellaz artwork). But there’s a lot of people who don’t get it.
Don’t think this lowers the value of the collection.
In another piece on the potential of Web3 being a scam, I spoke about how all artwork is subjective, and I personally don’t get modern art.
That doesn’t take away from the fact that modern art is very popular.
Take CryptoPunks, one of the largest and most profitable NFT creations.
It’s simple pixel art. Some might love it, but a lot of people comment on how they don’t get or like the artwork.
What seems to work with these generative pieces is a lot of unique and rare features.
On marketplaces like OpenSea, you can actually drill down to see how rare different elements of each NFT are.
I’d argue that people aren’t looking for the artwork here, but are taking pride in the rarity of an element.
You often see people building small sub-communities of people who share rare traits. More on this later.
But the point is, the artwork here is more about bragging rights than the art.
And on the other hand, you have the piece “5000 days of Beeple”.
Beeple’s a celebrated digital artist, and the above-mentioned piece is a collage of 5000 days of his work.
The likelihood someone wants this specifically for the art is far higher than a generative pixel art piece.
Buying for either reason is fine. And thankfully, there are different NFT marketplaces that focus on different needs so everyone can find what they want.
But the point is, the artwork is important.
Whether it’s a generative approach that allows people to search out rare elements for bragging rights, or traditional artwork people want to own to hang on a wall.
Blue-chip NFTs have great communities
This is personally where I think the real value of the majority of NFT collections lie. And what I believe makes certain NFTs and collections blue-chip.
A lot of NFT collections include access to a community. Most often through Discord.
This, in itself, isn’t inherently valuable.
In fact, if an NFT collection has thousands of members in the community BEFORE anything has been minted, it’s often a worrying sign.
However, if the private communities held exclusively for holders are managed well, it can be incredibly valuable.
Because being a part of the same community is a soft intro to others.
And if there are others in the community who could help your business or personal abilities grow, then you’re one step closer to your success.
This is doubly true if the community is filled with high performing or high visibility individuals.
Getting a soft intro to a big founder or celeb could be a game-changer for your goals. These people would otherwise be unreachable.
This is where I believe the real value of NFTs are right now.
It's a community of people who can help you achieve your goals, and in that sense, it’s a little different to a high-level mastermind group.
Blue-chip NFTs have real-world utility
This is, again, one of the top ways to differentiate your NFT collection.
If you look at a lot of the collections that grow a solid base and get high floor prices, they often have real-world utility.
Take Leveling Up Heroes as an example. Their Epic tier includes a number of real-world actions and events from business growth courses to dinners and conference tickets.
Crypto Packaged Goods also have a lot of real-world benefits to joining from investment opportunities to community meetups and collaborations.
This is, to me, what takes an NFT from being little more than a collectable image to something that people will benefit from.
And that benefit is what’s going to help the collection hold its floor price and continue to trend upwards in value and desire.
The real-world utility of collections really shouldn’t be overlooked for long term benefits.
NFT collection team and founders, and community contribute to blue-chip status
The major issue with Web3 is that it’s something of a wild west right now.
And unfortunately, there are a lot of scams and rug pulls causing people to lose a lot of money.
It’s important to verify the validity of any new collection being released.
Let’s head back to Crypto Packaged Goods and Leveling Up Heroes.
You can quite easily see who the founders and team are direct from their main website.
They both offer links to their full team with links to social so you can more easily do your due diligence.
Crypto Packaged Goods also releases a list of the Mentors who helped them. You’ll find some big names which again can be easily checked out.
If the founders and team are willing to release information on who they are, the likelihood this is a scam is reduced (but never zero).
A quick caveat
One of the major caveats here is the team behind Bored Ape Yacht Club.
For a long time, they were completely anonymous. It’s only a post and investigation from Buzzfeed which revealed their identities.
And despite that, BAYC is one of the premier blue-chip NFT collections.
However, this is the exception.
Generally, it’s ill-advised to invest in anything where the founders and ultimate holders of your investment are unknown.
As shown when the co-founder of the Cryptocurrency Wonderland was revealed to be a serial scammer.
Due to the almost anonymous nature of blockchain technology, it can be a lot easier to obscure a shady past and so trusting the founders is key.
So make sure you know whose project you're investing in.
NFT Marketing is key to hitting blue-chip status
This one’s simple.
Some NFT projects have grade A marketers who can help to build and push the hype of the collection.
If there’s great marketing behind the project, there’s a good chance it will grow to become one of the best options.
There are no hard and fast rules here, however, I’ve listed a few of the things I look for below.
Great projects will partner with established influencers.
Now, you have to be careful when looking at this. There are a lot of influencers who will join a project simply to make some cash.
When I’m looking through who they’re partners with and who is helping them promote the project, I’ll ask…
- Is this person representative of the community I want to be a member of?
- Is this person bought into this project (or are they just promoting lots of different projects)?
- Is this person someone who has a track record and respectable public image?
If the answer to any of these is a no, then I’ll be very wary.
Take this example of early backers for Leveling Up Heroes.
We have established YouTubers, trustable influencers in the space, top marketers and founders.
- Do I want to connect with people like this? Yes.
- Are they bought into this specific project? Yes.
- Track record and respectable? Yes
Is the community getting involved and helping further the cause of the project?
A lot of projects use really terrible growth hacks like “tag two friends to get on the white list”.
These can be OK projects to invest in, but there’s a lot more NFT projects could be doing.
If a project has a chance of hitting blue-chip NFT status, they need to do more.
And they need to get their audience involved to maintain momentum. After all, if the community dies off and never talks about their NFT collection, there will be a natural decline in desire for it.
And if it’s light on utility, this could see the price plummet.
A few things I look for from the community include:
- Community members using the artwork as profile pics
Are people using the NFT as their profile pic?
- Public, unprompted, posts about their NFT
Are the holders taking it upon themselves to share new content and connect with other holders without prompting?
- Spin-off offers from third parties based on the NFT project
Are people taking their NFTs and using them to launch new offers, businesses, and ideas?
If the answer to any of the above is yes, there’s a good chance the NFT collection will grow - perhaps not to blue-chip status, but it should grow from sheer hype.
With that out of the way, let’s look at some blue-chip NFT examples.
Examples of blue-chip NFTs
As we write this there are currently only a handful of NFT collections that could truly be described as blue-chip.
Below, I’ve listed out the potential blue-chip titleholders and explained what it is that helped contribute to their success.
What’s interesting to note is these examples are already at the very top of the OpenSea all-time rankings.
Let’s look at why.
Blue-chip NFT #1 - CryptoPunks
An OG NFT collection
CryptoPunks from LarvaLabs are one of the first huge NFT collections.
They kicked off a lot of the hype in this world and have been a mark of pride for many as they show you’ve been in it from the b beginning (or you have the cash to pay a few hundred thousand for a Punk).
Since their creation in 2017, they’ve grown to be incredibly valuable.
To date, CryptoPunks have traded with a value of over $2B, with some sales costing mid to high 7 figures.
Reason CryptoPunks are blue-chip NFTs?
- Being THE OG means these will always be collectable
- There’s huge bragging rights and social cred for owning one of these
- Has spawned other Web3 projects which rely on the continued existence of CryptoPunks (Punk Comics as an example)
That’s it really. CryptoPunks are blue-chip because people see them as valuable, and likely always will as they launched the space.
Blue-chip NFT #2 - Bored Ape Yacht Club
Another OG NFT collection
The Bored Ape Yacht Club (BAYC) is also one of the early-stage collections, which of course carries some weight in this industry.
While the trading volume isn’t as high as CryptoPunks, it’s still very respectable and they currently have a floor price of 92 ETH.
Reason Bored Ape Yacht Club is a blue-chip NFT?
- Stood the test of time
- Have a strong community to engage within the yacht club
- Has spawned multiple other NFT collections within the Yacht Club NFT-verse
Blue-chip NFT #3 - Decentraland
A world-building NFT
Decentraland is the first of its kind. An NFT collection that allows people act within the digital world they’re actively creating.
It's also had a huge amount of trading volume over its lifetime.
Why is Decentraland a blue-chip NFT?
- Utility beyond the NFT
- Network effect - each new buy-in increases value for existing holders as it adds new players who add new things of the world
Look out for or launch your own blue-chip NFT collection
It’s actually not that hard to spot what could become a blue-chip NFT collection.
All it really comes down to are the following points.
- Look for interesting and/or rarity within the artwork
- Assess whether the NFT has some form of long term bragging rights associated with ownership
- Look for the community and if it’s genuinely helpful and useful for holders
- Examine the real-world utility, and how that utility will develop or degrade over time
- Look into the founders and team, are they trustworthy and proven in their space?
- Do they have a strong marketing presence and plan?
If you follow these steps, you should be able to spot the fakes and guaranteed failures a mile away.
In the meantime, have some fun.
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