Today I want to discuss whether the NFT Avatar collections are in a bubble, and I'll also take a look at the top performing NFT avatars until now and what that tells us.

For those that are newer to this weirder side of the crypto space, basically I’m referring to collections like Cryptopunks, Bored Ape Yacht Club, Meebits, Cool Cats and Bulls on the Block, and these collections typically come in packs of around 10,000 similar NFTs and have pre-generated traits that make some more rare than others. They’re often used as avatars or profile pics on social media and if you follow this channel you know I’m super bullish on these NFTs in general, but it's easy to envision a bumpy path on the way to the finish line.

With NFTs it's a lot harder to determine whether a bubble exists compared to something like stocks where you can compare price to a company's underlying financials. So I don't want to give the impression that I'm bringing an ultra scientific approach to the table. But if you've been around crypto long enough you start to get a feel for the subjective markers of a bubble (the ICO boom in 2017 for example).

As you'll see in the video, there have been some hugely successful NFT collections but also some big underperformers. And what we're now seeing is that, yes - there may be exuberance when it comes to the actual minting of these NFTs because it's more like gambling in the case that you get a rare piece, but after that investors are not necessarily buying up everything that they can get their hands on. It does seem like people are doing a better job of weeding out the bad from the good, and standards are slowly being raised. Obviously this doesn't mean that some collections aren't overpriced - that's totally possible, but the NFT Avatar market as a whole is not far beyond what one could expect given that it's still ~20% of what games like Fortnite were able to make in a year from cosmetics like skins.

I also discuss how the current phase for NFT Avatars can be seen as the "DIY" or "homemade" stage, and this could mean that the majority of the current collections won't be good long term investments because they likely won't be able to compete with the more professionally branded NFT collections coming in the next phase. As a result, I'm tightening my own checklist and am becoming way more choosy in the NFT Avatars that I buy into, and am focusing a bit more on play-to-earn games (Axie Infinity, Zed Run, Blankos Block Party etc.) due to the more immediate cash flow opportunities.

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0:00 Intro
1:28 what is a bubble anyways?
2:10 how can we know if NFTs are in a bubble?
2:38 the current state of NFT Avatars
3:03 the top performing NFTs
5:32 the middle class NFTs
5:56 the curious case of Meebits
6:59 the worst performing NFTs
7:24 BONUS: what if you bought everything?
8:34 so is there a bubble or not?
9:29 how big is NFT avatar market?
9:56 are some collections overpriced tho?
10:43 my concern about the current phase
13:00 my own approach right now