Rugs, Pumps and Bears Oh My
We have to be honest and say we were not prepared when we first began our NFT journey. Our organization, founded before the advent of the NFT, was ill prepared for the reality of NFTs and the predation and practices common in this economy. If you’re new to NFTs you may be unfamiliar with some of these common practices and terms.
We’re writing this to help out new NFT community members. Here’s some common practices to avoid when looking at NFTs.
Pump and Dump
Whales may invest in an NFT to synthetically increase demand, driving the perceived value of the project up. Once new money comes in and hype has been built (usually through influencers or promotional specialist), they sell it all getting their initial investment back plus a hefty profit. This tanks the value of the NFT project and leaves everyone who missed the dump taking a loss.
A big tell for these kinds of projects are loud voices complaining about early resellers, and championing diamond hands. In reality they only want people to hold on long enough for them to dump it. They often use all kinds of gimmicks to assure people this is a long term project. This is often combined with rugging.
Rugged
Another practice common with NFT projects is promoting the project and building a community around a project with long term ambitions, but then abandoning the project after the initial sales of the NFTs. These projects often talk about future plans that include rare drops to community members, and future releases that will continue to increase the NFTs value but once the initial sales are done, they pull the rug out from the community, sometimes deleting all the projects communication methods (website, twitter, discord) and leaving the owners of the NFT with no way to contact the project starters. The prevalence of dumps and rugs has lead to a certain amount of fear, uncertainty and doubt about new NFT projects.
FUD
Fear. Uncertainty. Doubt. With new project sprouting up all over the place, many people have reasonable doubt about new teams and projects, and with the community being manipulated by scammers and shillers, it’s easy to understand the fear investors have about new NFTs. No one wants to get rugged or get dumped on. What can a new investor do to be safe? Some might advise you to only trust well-known projects with a long history of trades in or around the price you’re willing to pay. This might be fine for people looking for marginal returns, but to get a great return on your investment requires more risk. That risk is what scammers manipulate by preying on investors FOMO, to get them to buy into NFT scams.
FOMO
Fear of missing out. If you don’t get in now the project will be sold out, and you will have missed your chance to profit from this project! Get it now, don’t wait! This is the kind of language people use to prey upon the those with the fear of missing out. To some degree these fears are legitimate. Getting in early on a project can turn out very well for you. So each time you let that chance go by not getting involved you run the risk of missing out. But failure to gain is not the same as losing what you have.
If you’re new to NFT collecting, these are some terms you will come into contact with soon (if you haven’t already), so it pays to be aware. There are plenty of great projects that don’t use predatory marketing and practices designed to maximize the team and promoter’s profit at the expense of the communities.
If you’re looking for a completely different NFT project that is dedicated to staying far away from all these predatory practices take a look at the Crypto Artificers Guild various mystical collections. We have a unique model of building long-term value over time with no financial risk for early community members. We’ll publish more about our model later, but to get involved now, sign up (for free) to become a recipient of our beta NFTs. They are completely free and active community participation unlocks further NFTs in the future.
About the Crypto Artificers Guild
The Crypto Artificers Guild is a group of artists, mystics, and technologist established to answer one question. Does science and technology exclude the mystical or is it possible to create a fusion of the mystical with technology? Please consider participating in our project by becoming a beta tester.
