Beginner Series

How To Identify Good NFT Projects

Many early NFT investors have become millionaires almost overnight. Back in April 2021, you could mint a Bored Ape Yacht Club (BAYC) NFT for just 0.08 ETH. Less than a year later, the floor price hit a massive 118 ETH, worth over AU$400,000 at the time of writing. 

What actually are NFTs? NFTs are digital records stored on a blockchain like Ethereum. They prove ownership of different pieces of digital media, such as art, videos, music, gaming items, and even memes. Anyone can create them, trade them and own them. Read more on NFTs and 13 infamous projects

Naturally, not every project has seen the same success, which is why it pays to be a discerning NFT investor. In this beginner’s guide to identifying a good NFT project, we cover everything you need to know, from understanding the reason you want to buy an NFT to where you can discover the hottest projects.

1. Why are you buying NFTs?

NFT projects mean different things for different people. The first step in identifying what a good NFT project is, is understanding why you’re buying them. Only then can you find the NFT project that’s right for you. Below we explain a few common reasons for why people buy NFTs. 

Make money flipping NFTs

It’s no secret that many people simply want to get rich buying and selling NFTs. In fact, many people have already made millions of dollars flipping NFTs. So if that’s why you’re buying NFTs, make sure you do your own research and find some undervalued projects with excellent growth perspectives. 

Artistic merit

Tyler Hobbs and Mike Winkelmann (Beeple) are well-respected artists in their own right. They’ve sold NFTs for tens of millions of dollars and are pioneers in the space. Many investors want to own pieces that have proven artistic merit. 

Of course, others are looking to invest in a piece by the ‘next Beeple’. Along with wanting to own a piece of digital art that becomes incredibly valuable one day, they love supporting up and coming digital artists. Notably, there’s a vibrant NFT art scene on the Tezos blockchain. 

Learn about NFTs

The best way to learn about NFTs is to dive into the space and buy some for yourself. That way, you’ll be able to practice using crypto wallets, making transactions on the blockchain, and securely storing your NFT. 

If you’re just starting out, you don’t want to spend too much money on gas fees. That’s why it’s best for beginners to start on blockchains that have cheaper fees compared to Ethereum, such as Polygon and Solana

2. Where to find exciting new NFT projects?

So many people are promoting NFT projects at the moment, however, they’re not all created equal. While some will be the next big thing, others will fizzle into oblivion. That means you have to look for trusted sources and hidden gems. It’s not easy, but if you pay attention, you can find an exciting new NFT project that is about to explode. 

Which projects have increased their sales volume the most in the past 24 hours? What are the top projects of the past week? Looking at the stats on the biggest NFT marketplace, OpenSea, you can find the top projects of the past 24 hours (or week) to see what’s gaining popularity right now. You can evaluate even more NFT projects on the NFT aggregator website called CryptoSlam

NFT influencers

There are experts in every industry. For the NFT space, you can find most of them on Crypto Twitter. There are successful entrepreneurs turned NFT investors, leading digital artists, and even pseudonymous NFT personalities with huge followings. By following and engaging with the top people in the space, you can start building your knowledge of the space and you may even come across an exciting new project. 

Here are some of the top NFT influencers:

  • Artchick is a pseudonymous NFT collector that has been instrumental in the success of the World of Women NFT project. 
  • Elliot takes NFTs as seriously as anyone. Known by some as the NFT whisperer, he specialises in NFTs for play-to-earn games and has built sophisticated NFT trading strategies. 
  • Alexis Ohanian is a co-founder of Reddit and was an early investor in the NFT play-to-earn game Axie Infinity. He also focuses on the Polygon NFT ecosystem, which can be a great place for beginners to start thanks to their low fees. 
  • Punk6529 is known for his epic deep-dives and Twitter threads that explore the future of the NFT space. Given that he owns a Crypto Punk, he clearly can spot a trend early. 
  • Kevin Rose founded the successful website Digg and has been a part of the internet start-up scene for a long time. Notably, he sold one of his Fidenza generative art NFTs by Tyler Hobbs for millions of dollars. 
  • Snoop Dogg is infamous in the NFT space, having promoted projects in the metaverse and owning many valuable NFTs himself. 

3. How to evaluate NFT projects?

There are many factors that impact the value of NFT projects. Depending on the NFT project, different factors can be more important than others. For example, utility is more important for a sports team’s NFT, while rarity is more important for generative art. 


Utility is the real-world benefits that are added onto an NFT, such as commercial rights to the image, access to exclusive content, and even airdrops. Dynamic NFTs are also popular on blockchain-based games like Axie Infinity, such as giving gamers a power-up or spell. 


In-demand NFTs with a limited supply earn much higher prices than projects without that scarcity. While all NFTs are one of a kind, they’re often part of a collection of themed NFTs, such as the 10,000 Bored Ape Yacht Club NFTs. This scarcity helps make a project more desirable.


The bigger the community of an NFT project, the easier the project will spread by word of mouth. Celebrities can also be a big boost to the project as they can share the project with their millions of followers. 

Floor price

The floor price is the lowest price that any NFTs in a collection are selling for. It’s a positive indicator when the floor price is rising and can be a concern if it’s falling quickly. 


The volume of NFTs traded in a collection is a good indicator of the demand for the project. You can check the volume of a particular project compared to other projects, and also see whether the volume has been trending up or down over time. 

Estimated market cap

The estimated market cap is a key metric that many NFT investors use to identify whether a project is overvalued or undervalued. You can find the estimated market cap of hundreds of projects on the Rarity website.


Do the founder and team have a proven track record? It’s a positive sign that they are well known in the industry as builders who create valuable projects. While some investors like the real names and faces of the people behind the project, others are comfortable with a completely pseudonymous team. 


Are there any upcoming partnerships, business opportunities, or project developments? While some NFT projects like Crypto Punks and Ether Rocks are simply collectibles, others are building metaverse worlds where the NFTs can be used or are adding real-world utility in other ways. 

Learn more about NFTs and explore the top projects

Now that you know how to identify good projects, you can start looking for trending projects from NFT influencers and on NFT marketplaces. To learn more about the space, check out some of the top NFT projects that we cover in our introductory NFT article. You’ll find insights on Crypto Punks, World of Women, CryptoKitties and more. As always, at Cointree, we’re here to help you grow.

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