What is the TRUPPA formula?

T - Tangibility

Tangibility in the virtual world, seems unreasonable, but this is one of the important factors for valuing an NFT project. NFTs connected to real-world objects offer tangible value, especially when they are backed by the immutability of ownership. To value an NFT, the first question to ask is Tangibility: How does the NFT relate to the real world and add value to the real world? In essence, anything can be supported by NFT to enhance ownership, but this is not what makes the object unique. The fundamental value of an NFT project will be assessed by its practicality, tangibles, and satisfying individual user needs. For example, owning an NFT ticket to an exclusive music event by a famous artist will certainly be worth more than owning an NFT with a bottle cap. RAC's real name is Andrรฉ Anjos, a Portuguese-American musician and music producer who has won the prestigious Grammy Award. One RAC fan paid $2,250 for a copy of the newly released YOU album and there will be only 100 copies of that. Although the buyer can make and sell copies, they will not be identified and therefore will not be of much value.

R - Rarity

NFT's scarcity can be understood as "limited quantity" and "difficult to own". For example, when the NFT is created with the image of a famous A-class artist, accompanied by a personal inspirational story, this story is the only one in the world โ€“ this will create a difference, thereby creating uniqueness. In addition, video games are also one of the factors that create scarcity for an NFT.

U - Utility

A valuable NFT is a highly applicable NFT that satisfies many user needs. The utility of NFT comes from its practical application, either real or digital. For example, some NFTs are not only collectibles but can also be used in games: like buying land, and using items, and characters. This property of NFTs provides immediate value, the more they accumulate over time, the higher their value will be. As the gaming community of Decentralized gaming grows stronger, many of them will be willing to pay a large amount of money to own an NFT. Example: A pair of luxury high-end shoes is created in a factory in Italy. It is assigned an NFT that you can quickly scan on the packaging. Once the shoes reach their final destination, the store can scan them and mark them as received. A detailed history can be viewed and confirms the authenticity and shipping of the shoes.

P - Popularity

According to Dap Radar, an analytics platform, NFT trading volume skyrocketed to $10 billion in the third quarter of 2021, a sevenfold increase from the previous quarter's figure. Currently, popularity has a big impact on how users value an NFT project. Many artists, actors, and even supermodels are deploying and auctioning โ€œdigitalโ€ assets and electronic goods on blockchain platforms. Through NFT, influencers (public figures) can connect with fans in each field. NFT of a famous artist or a well-known creator (content creator) will attract and have wider coverage than other NFT products. Currently, there are many big brands such as Coca-Cola, UFC, Dolce Gabbana, ... and famous artists like Lionel Messi, Lindsay Lohan, Mark Cuban, Gary Vaynerchuk, Shawn Mendez, ... participating in the NFT market.

P - Profitability

The purpose of the user wanting to own an NFT is that the NFT will be profitable in the future. A successful NFT project is a profitable NFT for its owners. Currently, there are many virtual games created to help players earn money by selling in-game items, creating land to exchange with other players. For example: The Sandbox, Decentraland virtual amusement park. For example, CoinDesk gave the example of a gamer who sold a series of land lots in Decentraland for $80,000, or an investor who bought the racetrack in the F1 Delta Time game as NFT. This person will receive a 5% dividend from races taking place on this stretch, including entrance tickets.

A - Ability of Development

Back to the end user's need is to make a profit when owning NFT. Just like investing in Crypto, before pouring money into a project we need to research the product, service, and that the business owns. Asking the question of whether this project has potential for future development is the most important question that every investor needs to answer before participating in, buying, and selling any NFT product. For example in Decentraland, you will build a virtual world by using tokens to buy a piece of land and be creative, build all you want (e.g. mall, casino, ...). With this platform, users take full control of the assets they own and benefit from the money earned through transactions on the system. In addition, users can refer to the questions below before valuing any NFT.

  • Is this NFT capable of developing the surrounding product system?

  • Does NFT have the ability to connect with other metaverses?

  • Which blockchain is that NFT minted on? Reputable or not?

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