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    How To Use NFT Profit Calculator

    What’s an NFT Profit Calculator? Well, first you should know that NFT trading is one of the hottest financial activities in the world today. In 2021, total NFT sales reached $25 billion. Although NFTs belong to the precarious asset class, many people are dying to get in on the act of profitable trading. That’s where the profit calculator kicks in.

    What most don’t know is that not everyone makes money from NFTs. Yes, they are big winners, but they are also big losers. This doesn’t mean that NFT trading is not profitable. It means a person has to take all the necessary steps to increase their chance of making a profit. The best way to do that is using a profit calculator for NFTs. Before we explain how an NFT profit calculator works, let’s quickly understand what NFTs are all about.

    What are NFTs?

    Non-fungible tokens are digital versions of real-world items. The most common NFTs are digital art, videos, pictures, game items, and trading cards. NFTs have a unique address that indicates ownership. They are called non-fungible because each NFT is unique and can’t be replaced by any other, even if they look alike. Some NFTs are also used for fractionalized ownership of assets like rare wines, cars, and other valuables.

    Uses of a Profit Calculator

    Making money from trading NFTs is quite complicated. Many users expect to buy an NFT and sell it a little higher than they bought it. Unfortunately, the nature of minting and trading NFTs comes with financial costs that affect the overall profit made from the NFT. A profit calculator helps people check how much they would gain or lose when they sell. It helps users set a good price that considers all the fees incurred on each sale.
    That’s a good PROFIT NFT CALCULATOR. 

    How Does An NFT Profit Calculator Work?

    An NFT profit calculator uses four key metrics to calculate potential losses or gains on any NFT sale. These four factors include:

    Marketplace Service Fee

    The marketplace where NFT trading takes place will charge a fee on all transactions. Some marketplaces like OpenSea give users some flexibility over how they pay service fees. For instance, a seller can also choose to pay the buyer’s service fee.

    List Fee

    First-time NFT sellers have to pay a listing fee which varies depending on the network. Subsequent listings on most marketplaces will be free. Some marketplaces also offer a free listing on the first NFT.

    Mint Gas

    Mint gas is charged for minting NFTs. Since mint gas depends on the network, it fluctuates – sometimes reaching hundreds of dollars. High gas fees for minting discourage many creators, so networks have started adopting a method known as Lazy minting. Lazy minting allows creators to design NFTs off-chain. Thus creators only pay gas fees for minting when an NFT is purchased. 

    Royalty

    Royalty fees are charged each time the NFT is sold. They are automatically deducted and sent to the creator. Creators are free to set royalties. However, standard NFT royalties are around 5 – 10%. However, some NFTs have higher royalties while many others don’t.

    Buy Gas

    Purchase gas fees are used to execute NFT sales on the blockchain. Most marketplaces will charge gas fees for completing the NFT purchase. Again, gas fees depend on the size of your transaction and sometimes the network availability i.e., when the network becomes congested, gas fees tend to rise.

    How To Use Chainwitcher’s NFT Profit Calculator

    Below is a step-by-step guide for using ChainWitcher’s NFT profit calculator.

    Step 1: Find the Collection You Want

    There’s a search bar available to look for the collection you intend to buy or resell. Once you find the NFT collection, the royalty bar will show you how much royalty is on the NFT.

    Nft-profit-calculator-gif

    Step 2: Enter Purchase Price

    Fill in the amount you’re willing to pay or have paid for the NFT. Usually, this is around the floor price. Once you fill in the buy price, you will see the service fee.
    enter NFT price

    Step 3: Put the Sell price

    Put the amount you are willing to sell the NFT. The profit calculator will then show you how much profit or loss you get on that deal.

    The profit or loss depends on how much you spend to own and sell the NFT versus how much you make from the NFT sale.

    NFTs with higher royalties will yield less profit or a loss when sold at floor prices, while royalty-free NFTs can deliver returns when their price is close to the floor price.
    nft profit calculator sell price

     

    Step 4: Profit or Loss Summary.

    NFTs with higher royalties will yield less profit or a loss when sold at floor prices, while royalty-free NFTs can deliver returns when their price is close to the floor price.
    NFT profit calculator profit summary

    Conclusion

    NFT profit calculators help traders calculate their expected profit at the end of each NFT sale. Trading NFTs is a very lucrative activity that also comes with high risk. For this reason, users have to optimize trades to make profits. They need to calculate pricing in a way that returns profit after deducting all their expenses.  Here is a detailed guide on how to use a comprehensive profit calculator for trading NFTs, 

     

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