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Dear Bankless Nation,

I’ve previously written about how to assess the quality of individual NFTs in Mint Condition.

But what about NFT collections as a whole, which truly stack up above the rest?

Toward that end, I’ve been working on a ranking system that, while subjective depending on the analyst, does attempt to score and compare NFT projects holistically. 

I’m expanding it into a full curated Bankless resource soon, but for now I wanted to generally walk you through the criteria so you can start analyzing and comparing NFT projects more deeply too!

-WMP

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How to Rank NFTs 🤔

Why rank NFTs?

Discovery and context remain problem spots in the NFT space. 

For example, let’s say you’re new to NFTs and want to explore the best projects that are really making an impact in more ways than one. What to do?

You could go to a marketplace like OpenSea and use its “Stats” section to find the biggest projects, but then again you’d only be able to sort by trade volume, floor price, etc. This would skew the search in an overly quantitative direction. 

Don’t get me wrong, numbers and stats and activity certainly matter. But if that’s all you focus on, then you overlook things like technical quality, aesthetic value, and other things that really do matter and likely will matter even moreso over time. 

So why try to rank NFTs in a holistic sense? To try to get the whole picture of a project and how it compares to others in the space across a range of criteria, not just trading volume or hype!

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10 criteria for ranking NFTs

This is a subjective system. Everyone can use the following criteria to come up with different results. But with that said, I do think these criteria make up a great foundation for how any NFT project should be analyzed in a holistic sense. They are:

• 👤 Creator reputation — Is the creator or creators seen as a beacon of excellence and inspiration? Or do they have a complicated past with some big question markets? Is it somewhere in between these two poles? Gauging the quality of the makers and their vision is key. 

• 🎨 Aesthetic value — Beauty is one of the most subjective things. And even “ugly” work can have charming or redeeming aesthetic value. And again, there’s a wide spectrum between these poles. Digging into the how and why the visuals of a project are meaningful is really important.

• 💾 Technical quality — There are NFT projects whose smart contract setups are marvels, both in the creative and engineering senses. And there are also very uninspired and very mutable approaches to NFT smart contracts. There are pros and cons to any design approach, to be sure, but you should be granting high marks to projects with excellent technical structures. 

• 🗿 Cultural impact — Has the collection influenced the wider NFT space, and to what extent? And has it had any breakout success in mainstream circles? CryptoPunks is a prime example here with its inspiration of the 10,000 collection supply meta. That model has had major cultural impact in NFTs ever since, and this kind of influence needs to be factored in. 

• 🤝 Community — Is the project’s community and its main hubs teeming with activity? That’s basically always a plus. The more teeming a community is, the more opportunities there are for people to get involved. Online events, IRL events, what have you, more opps for community members is a good sign. 

• 🔑 Usefulness — What are the project’s use cases? Does your NFT unlock any specific utilities or token-gated resources, etc.? And mind you, some utilities are native and built by the project’s team, while some are external and come because of the popularity of the main project. In that latter regard, big projects like Bored Apes and ‘Punks are useful because basically every 3rd-party NFT lending project supports these NFTs as collateral for borrowing against!

• 🫡 Project management — Not all NFT teams are still stewarded by the original creators. Luca Netz and the current Pudgy Penguins team are examples of how new leadership can sing compared to the original founders. So this criteria is distinct from “Creator Reputation” in that it’s all about how a project’s run in the here and now. 

• 📈 Market activity — Does the collection have lots of liquidity, listings, and volume? These are definitely signs of health and might. My main thing is that I think people in the NFT space tend to overemphasize the importance of this particular criteria, but regardless it’s still a major point to take into consideration. 

• 📢 Hype — Does the project have any intriguing upcoming happenings, releases, etc.? I don’t think NFT teams should feel the constant pressure to release new things, but this criteria does help take into account interesting newsy things and trending narratives that haven’t necessarily fully come to fruition yet. 

• 🔮 Future prospects — Will this collection be around in 5 years, 10 years, 50 years? Why? Here I give good marks to onchain projects who will be indefinitely available on Ethereum, etc., but onchainness isn’t necessary for a high score here. Relevance ties in here, long-term vision ties in here, persistent execution ties in here, and so forth. 

Example: Nouns vs. Cool Cats

Nouns DAO is an NFT-based collective that’s actualizing a decentralized CC0 brand, and Cool Cats is a charming PFP collection with various gaming elements. I like both for different reasons, but how do they stack up compared to each other using the above criteria? Let’s see! These are just my subjective scorings, but here goes:

Nouns

• Creator reputation – 9/10

• Aesthetic value – 10/10

• Technical quality – 10/10

• Cultural impact – 8/10

• Community – 8/10

• Usefulness – 8/10

• Project management – 9/10

• Market activity – 4/10

• Hype – 6/10

• Future prospects – 10/10

Overall score: 82/100

Cool Cats

• Creator reputation – 6/10

• Aesthetic value – 8/10

• Technical quality – 5/10

• Cultural impact – 5/10

• Community – 7/10

• Usefulness – 7/10

• Project management – 6/10

• Market activity – 7/10

• Hype – 7/10

• Future prospects – 5/10

Overall score: 57/100

Again, I’m personally a big fan of both these projects, and these scorings are subjective and just about how things stand right now according to my view. I could dig into all my reasonings above, and I will at a later date, but for now you get the idea. And you’d likely arrive at different figures via your POV, and that’s totally fine! 

The really important thing here is the general thrust of the criteria, I think. If you pick out a collection and go down the line researching and answering these 10 points, then you’ll have a good handle on, and a good argument for or against, any project you scrutinize. 

Try for yourself!

The cool thing about this ranking system is you can easily try it for yourself. For a little bit of fun homework, pick out two disparate projects like I did with Nouns vs. Cool Cats above and score them according to the 10 outlined criteria from this post. 

See what the results are like. Did they surprise you or not? Do you rank a certain project way higher than you think other people in the space would, and why? 

There aren’t necessarily any simple or straightforward answers here. And a good bit of research is required to get these scores close to the mark. But if you do dig into this sort of NFT ranking process, it absolutely will make you a better analyst because it’ll hone you in on focusing on all the key details!

Action steps

• Rank NFTs: pick two of your fav NFT collections and compare them per the 10 criteria above 🔍

• Catch up on my previous post: learn about fully onchain gaming in Autonomous Worlds 👾

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Not financial or tax advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This newsletter is not tax advice. Talk to your accountant. Do your own research.

Disclosure. From time-to-time I may add links in this newsletter to products I use. I may receive commission if you make a purchase through one of these links. Additionally, the Bankless writers hold crypto assets. See our investment disclosures here.