Understanding NFT Rarity
Why do some NFTs sell for exponentially more money than others in the same collection? Similar to trading cards, this is because of differing rarities. Generally, rarer NFTs are valued higher but usually less liquid. For example, one of the rarest Bored Ape Yacht Club apes sold at a Sotheby’s auction for over $3 million. Understanding NFT rarity can be incredibly valuable for NFT investors and collectors.
What is NFT Rarity?
Most NFTs include a set of properties or traits that describe the NFT and help determine its rarity. Using the Bored Ape mentioned previously, you can see in the screenshot below that marketplaces display a set of properties in the description of the NFT. Each property shows up a certain number of times in the collection and the given marketplace shows this as a percentage. Taking into account each property of an NFT along with the corresponding rarities, you can determine the rarity ranking of each NFT in the collection. As shown below, this ape has multiple extremely rare properties, which explains how it sold for such a high price.
How to Calculate Rarity?
Although it’s possible to calculate rarity yourself, it’s very time-consuming and there are multiple NFT rarity ranking websites available that do the job for you. However, if the rankings aren’t available anywhere, you can use this formula to calculate the rarity score for each property:
Rarity Score of a Property = 1 / ([Number of NFTs with Property] / [Total NFTs in Collection])
Although it’s very easy to rank an NFT by rarity, determining the value of an NFT by rarity can be a tricky task. This is because each collection varies in how rarity is valued and people value certain properties differently. In some collections, only certain properties are valued significantly higher and the rest trade around the same price. Rarity can be factored into price not at all, a ton, or anywhere in between.
Another problem with valuing rarity comes from the fact that rarer NFTs are usually much less liquid since they are listed for higher prices. NFTs already suffer from illiquid markets, so it can take a long time to find a seller willing to pay a premium for rarity.
Regardless, people are willing to pay massive premiums for rare properties in certain collections, and this has led to some insanely large sales. People love to show off their wealth online, and rare NFTs have become a way to do that. Many of the best and most profitable NFT traders are great at valuing rarity and can take advantage of that. From an ROI perspective, many of the best NFT trades in history have been people getting lucky by minting a rare NFT on a hot project.
How RugZombie Offers Rare NFTs
RugZombie is the first protocol that allows users to get a better chance at minting a rare NFT by yield farming. The Tombs offer ZMBE-wBNB pools on 2 different DEXs, PancakeSwap, and ApeSwap. Users can stake ZMBE-wBNB LP tokens to earn ZMBE tokens and NFTs. Each pool has a collection of NFTs with different rarities and an “NFT Timer” that specifies how long you’d have to stake to earn an NFT (currently this timer is 14 days for each pool. Depending on your staked percentage of the Tombs total LP, you are placed in a bracket and higher brackets have a greater chance of minting a rare NFT.
What is an NFT?
NFT stands for Non Fungible Token. NFTs are assets on the blockchain that have unique metadata that does not allow it to be replicated.
What makes an NFT rare?
Each NFT has a “rarity score” that determines its rarity rank in the collection. This is calculated by taking into account the rarity of each property of the NFT.
What are the benefits of a rare NFT?
A rare NFT is generally valued higher.