1/6: What is the money flow chart in the NFT market?

In the non-fungible token (NFT) market, tokens can be classified into three main categories: collectibles, generative art, and 1/1 individual art. The flow of funds typically starts from categories with easy due diligence and then gradually moves to categories that require deeper study and analysis.

2/6: First category - Collectibles

🌐 Collectibles are the most popular and easy to understand type of NFTs.

Examples include: CryptoPunks, Bored Ape Yacht Club (BAYC), Degenz, Craniums.

These projects have a huge fan base and are often the first entry point for new NFT investors. Thanks to their widespread reach, due diligence can be easily done by following the community and past sales.

3/6: Second category - Generative art

🖼 Generative art relies on the use of software algorithms to create unique works of art.

Examples include: Autoglyphs, Fidenzas, Solvency.

Investing in these projects requires a greater understanding of digital art and the algorithms used to create these works. Although this category is less well known than collectibles, it is gaining popularity among a niche audience interested in innovative digital art.

4/6: Third category - Individual art 1/1

🎨 Individual Art 1/1 means that each artwork in this category is unique.

Examples include: SuperRare (SR), Foundation (FND), Async.

These artworks are usually very rare and require a deeper analysis and understanding of the artist and the art market in general. Because they are unique, their value is difficult to estimate objectively, making investing in them risky.

5/6: How money moves between categories

💰 The flow of money into the NFT market usually starts from the most popular and easy-to-understand categories, such as collectibles, where new investors can easily enter.

As time passes and understanding of the market increases, investors are moving into more complex categories such as generative art, looking for unique and distinctive projects.

Ultimately, the money is invested in 1/1 individual art, which is the rarest and most difficult to value.

6/6: Conclusion - Ease of Due Diligence

🧠 Collectibles are easy to due diligence thanks to popularity and transparency.

🔍 Generative art requires a greater understanding of technology and artistic creativity.

🎯 1/1 individual art is the most complex and needs in-depth analysis before making any investment decision.

As money moves from one category to another, it becomes more difficult to conduct financial analysis and make investment decisions. Therefore, understanding the market and specializing in a particular category can be the key to success.

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