The Unexpected Way People Are Getting Into The NFT Craze

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Contributor, Benzinga
February 14, 2022

Want to jump straight to the answer? Solana. See more alternative investment ideas.

With NFTs like Bored Ape Yacht Club for $1.41 million, a Nyan Cat NFT selling for $600,000 and an Alien CryptoPunk recently selling for over $23 million… some investors are wondering how to get into the rapidly growing $41 billion NFT market without actually buying NFTs themselves.

Instead of investing in NFT art or buying Ethereum at $3,100 per coin (at the time of this writing), there’s an alternative: Solana (SOL)

In addition to being used for NFT art transactions on Solanart, there’s a reason why metaverse developments like Star Atlas and Portal are using Solana. It has breakneck transaction speeds. It’s so fast that Bank of America said it could become the “Visa of the digital asset ecosystem." This is a key differentiating factor from Solana's main competitor, Ethereum, which can only process around 15 transactions per second.

Perhaps that’s why Solana has outpaced most other cryptocurrencies in gains. In one year, it became the 7th largest market cap in crypto. Going from $1.61 in 2020 to its high of $260 in 2021, Solana has generated more than 16,049% return for some investors. A small $1,000 investment could’ve turned into $160,490. 

Early investors of Solana, such as Multicoin Capital, 500 Startups, and a founder of Race Capital, have in some cases generated $1 billion in returns. But it appears this is just the beginning and investors are rushing in. Recently, Solana raised $314,159,265.359 during its private token sale, with billion-dollar venture capital firms Andreessen Horowitz and Polychain Capital leading the investments. 

What makes Solana so unique? While Ethereum can handle 15 transactions per second, and Bitcoin 4.6 transactions per second, Solana has the capability to process 65,000 transactions a second. And its capacity could increase further. As a comparison, that’s the same transaction speed that Visa Inc. currently handles. 

But that’s not all; because Solana’s based on a whole new technology compared to many other cryptocurrencies, it has the potential to scale and be faster. With Solana’s transaction speed already faster than competitors, Paypal is looking into Solana for themselves, pushing it closer to a breakout. 

Solana’s lightning-fast speed has to do with its “Proof of History” technology. Unlike Ethereum, which relies on external programs to assign timestamps to transactions, Solana has a timestamping capability built into the blockchain itself. This unique process of reducing time to timestamp data allows the verification of information quicker, and it dramatically increases the speed of Solana transactions. And we're still early on in Solana's development. Here are a few reasons why.

A few days ago, Solana Labs launched an everyday payment product called Solana Pay. It allows merchants to accept crypto payments directly from consumers. Solana is good for micropayments, as the fee is only $.000025 per transaction (as opposed to the 1.5%-3.5% credit card companies charge businesses). If successful, Solana could become the new decentralized credit card for different markets.

Solana already has a bright future in the online market, particularly in the NFT space. Not only is it working with Shopify and used in Solanart (NFT market), but many Metaverse companies such as Solice and Synergy Land also use Solana. 

Moreover, Metaplex, a company allowing users to build their own Solana NFT based marketplaces, just raised $46 million a few weeks ago. Tesla, Facebook, and Google stocks have also began trading on the Solana Blockchain. 

Solana is a “backdoor” way to get into the NFT craze without buying traditional NFT artworks themselves. By getting into Solana, you're exposed to a network token used for NFTs, decentralized finance, and much more. Its widespread adoption into different marketplaces as the blockcchain of choice for high throughput makes me believe Solana has the potential to become the market leading smart-contract blockchain platform. 

Another Unexpected Investment?

According to The Economic Times, contemporary art auctions reached a record high thanks to NFTs. That could be because lately, some ultra-wealthy individuals are getting into art. The Rothschilds sold one for $197 million. Oprah Winfrey grossed $62 million with this asset, and Jeff Bezos sold Amazon stocks and purchased $70 million of them. 

Contemporary artworks have outpaced the S&P 500 by 164% from 1995 to 2021. And thanks to new legislation, investors can now invest in this overlooked alternate asset alongside celebrity art collectors such as Leonardo DiCaprio, Jay Z, and Brad Pitt with Masterworks. There are more than 320,000 members on the Masterworks art investment platform; signup here.