The internet has opened up whole new methods of investing that could never have been imagined beforehand. This includes the ability to invest in various digital assets. Below are four different types of digital assets that could be worth familiarising yourself with.
Domain names are the oldest form of digital asset. They are the internet equivalent of real estate – and can fetch equally high prices. The most expensive domain name ever sold was Voice.com for $30 million in 2019. Other domain names like Business.com have been valued at over $345 million.
Of course, most domain names aren’t anywhere near this valuable, however they can still be bought and sold at a decent profit. You can buy domain names as cheap as $1 from domain registrars. If you’re lucky, a cheap domain name could increase dramatically in value over time. This could be a domain name containing a buzzword that becomes popular in the future or a domain name containing initials that a business one day wants to buy up. This guide explains more about investing in domain names.
Cryptocurrency has moved into the mainstream as an investment asset class. If you’re looking to add some to your portfolio, you can find more information here.
Cryptocurrencies are digital currencies. They include the likes of Bitcoin, Ethereum and Dogecoin. Just like real-world currencies, cryptocurrencies are constantly fluctuating in value. Some cryptocurrencies have seen huge rises in value such as Bitcoin, which quadrupled in value in the space of six months between October 2020 and March 2021.
You can buy and sell cryptocurrencies by using cryptocurrency exchanges. Once bought, cryptocurrencies should be kept somewhere secure such as a digital wallet. Make sure to look at cryptocurrencies beyond Bitcoin. You can learn more about investing in cryptocurrencies here.
An initial coin offering (ICO) is sometimes sold before the launch of a potential new cryptocurrency. Before a cryptocurrency is made official, a few ICO tokens may be sold to speculative investors. These have the potential to be very valuable if a cryptocurrency becomes successful. To give an example of an equivalent in the physical world, it’s a bit like owning one of the earliest copies of a new banknote.
There are websites dedicated to news of current and upcoming ICOs. These sites can help to tell where to invest in ICOs.
Non Fungible Tokens (NFTs) are certificates to claim that you are the owner of an original image, video or song. While there may be many other copies on the internet, a NFT grants you ownership of the source file. This could be the original file of a hit viral video uploaded to YouTube or the original JPEG of a famous meme image. It’s a bit like owning an original painting, the first ever pressing of a vinyl record or the first ever printed copy of a book. In some cases, such NFTs can become very valuable.
NFTs have to be sold by the original creator or someone who has since bought that NFT. There are guides online that talk about buying and authenticating NFTs.