The emergence of non-fungible tokens as an investment opportunity; the utility for holders; and the connection with communities are among the reasons more people are searching for NFT in investments.
While more public companies are getting into NFTs, offering investors an opportunity to profit with the growth of the sector, there is a lack of pure play investment opportunities.
A new NFT Fund is set to launch, offering investors an opportunity a way to invest in blue-chip NFTs in the emerging sector.
What Happened: Accelerate Financial Technologies announced it will launch Accelerate NFT Fund LP, which is the first Web3 investment vehicle in Canada.
The fund seeks to offer an investment opportunity for a $40-billion market that is deriving value from “aesthetics, social proof, membership, network effects, brand building and culture.”
The fund plans on owning a portfolio of “blue chip” NFTs. The press release for the fund launch listed CryptoPunks and Bored Ape Yacht Club as two NFT collections that will be featured in the portfolio.
“There are a number of blue-chips on our radar, of which we will announce once we acquire the assets for the fund,” Accelerate CEO Julian Klymochko told Benzinga.
The fund will be offered to accredited investors with a minimum investment of $50,000. The NFT Fund will be capped at $42.069 million. Investors can purchase units in the NFT fund through a private placement subscription agreement.
Klymochko said the $50,000 minimum investment is necessary to justify the cost of onboarding each new client for the fund.
The fund does not have a launch date set, but expects its first closing to occur in March.
Accelerate will make purchases of NFTs from OpenSea and other NFT marketplaces. The fund will focus on acquiring NFTs from existing collections.
“Core positions will be in existing projects, but may capitalize on preferential access to minting opportunities.”
Why A NFT Fund? Accelerate offers several investment products across product categories that include Bitcoin (CRYPTO: BTC), SPACs and merger arbitrage.
Klymochko said it is risky to own only one or two asset types in a portfolio such as stocks and bonds.
While some brush off NFTs as a fad and worthless investment opportunity, Klymochko highlights the long history of investing in art.
“Art is one of the oldest, most mature and established asset classes in the capital markets. It has been around for many hundreds of years longer than equities. NFTs present the transition of art and collectibles from the physical realm to digital realm, and collectors are telling you which they prefer.”
The goal for Accelerate is the have the largest NFT fund in the world, he said.
Related Link: How To Buy NFTs
Growth Of NFTs: Klymocko recently shared a thread on Twitter highlighting how NFTs could be a 10x investment opportunity.
“There are numerous benefits to owning an NFT, including IP rights, income-generating opportunities, airdrops, preferential access, real-world events, social proof, DAO ownership, in addition to getting to capitalize on value growth of the NFT collection,” Klymochko told Benzinga.
Klymochko calls Web3 the next era of the internet and an area that will be a more prevalent aspect of our lives.
“NFTs, or non-fungible tokens, allow users to not just participate in, but to own Web3. We believe that the most popular NFT collections may become the Googles, Amazons and Facebooks of Web3.”
Klymochko told Benzinga that large organizations in the Web3 space could be DAOs with tokens and NFTs in the future, and not large corporations.
“The NFT market came to fruition last year and its lifespan is measured in months not years. A decade from now, I believe the asset class will be materially larger.”
The number of holders of NFTs is still in its infancy, in Klymochko's view. There are less than 100,000 holders of blue-chip NFTs, he said.
“NFTs as social proof and credibility in the era of Web3 will only continue to grow.”
Another item for growth could be the continued launch of new NFT marketplaces like a highly anticipated launch from Coinbase Global Inc (NASDAQ:COIN).
“NFTs are still technically complex to acquire and hold safely. Large corporations making this process easier will only further facilitate participation in the asset class.”
