Fraud related to cryptocurrencies is constantly observed in the field of non-fungible tokens (NFTs), so it is important to always stay informed to avoid both new and existing NFT scams. In addition to fraud, intense competition for newly released NFTs can lead to price increases and transaction fees, making them inaccessible to early supporters. However, these issues have been addressed by NFT projects through the creation of whitelists or permission lists, which provide special privileges and access to newly released non-fungible tokens.
Contents:
- What is a whitelist NFT?
- How do whitelist NFTs work?
- Advantages of whitelist NFTs
- Disadvantages of whitelist NFTs
- How to get into a whitelist NFT?
- How to recognize fraud with whitelist NFTs?
- Is it worth trying to get into a whitelist NFT?
What is a whitelist NFT?
In the context of NFTs (Non-Fungible Tokens), a whitelist represents a list of wallets that have exclusive rights to obtain NFT tokens. This allows for minting one or several NFTs before their official launch to the wider public, often at a lower price.
A pre-release of tokens, often facilitated through a treasury mechanism or whitelist, offers the opportunity for community members and early supporters to access token issuance prior to their official public sale. However, the distinction between a treasury and a whitelist lies in the fact that a project's treasury enables the minting of a specific number of NFTs before the general release, with a fee involved, whereas a whitelist grants issuance rights without any additional fees.
How do white lists in NFTs work?
Below is a table describing how white lists work in NFTs:
Step Description 1 Creation of a list of cryptocurrency wallet addresses 2 Granting early access to newly released NFTs 3 Approval of addresses to be included in the white list 4 Verification of user accounts before adding them to the white list 5 Assigning a date and time of creation for the new NFTs to the selected addresses 6 Determining the duration of the time interval for access to NFT creation 7 Waiting for the specified date to gain access to minting the NFTs 8 Creating NFTs according to the accepted conditions
Many projects use a similar process to provide access to their NFTs and demonstrate priority to fans and early supporters.
Advantages of whitelist NFTs
Whitelists offer numerous advantages for investors, collectors, and project creators. For example, allowing dedicated fans to mint NFTs before the public release can avoid gas wars over pricing. Additionally, being on a whitelist usually results in a lower minting price compared to the public minting price.
This means that whitelist users will have a designated time slot to complete their purchase, and they can save on gas fees to spend more money on actual NFT purchases. Furthermore, collectors can be rewarded with additional NFTs if they manage to mint high-value NFT projects. For instance, Bored Ape Yacht Club holders received free Mutant Ape NFTs, allowing existing users to mint new apes for free.
Similarly, project creators save on marketing upfront and benefit from the promotion by early supporters who have a financial incentive to remain active in the project and attract new supporters. Additionally, project creators can deter spam from addresses not included in the whitelist by creating users from the whitelist, which is important as suspicious accounts can drive up gas prices and reduce network efficiency.
Disadvantages of whitelist NFTs
Getting on a whitelist takes a lot of time as it requires constant engagement on the project's Discord server and other social media pages. However, you may not make it onto a whitelist if the project doesn't gain traction.
In addition, unpopular NFTs can turn out to be illiquid assets that are difficult to sell on the secondary market. Therefore, always conduct your own research before minting non-fungible tokens and invest money only if you are satisfied with the project's future.
How to get into a whitelist NFT?
Every project has its own social media presence. You need to join them through platforms like Discord servers, Twitter, Telegram groups, etc. It's essential to be active to attract the attention of the project founders and get into the whitelist. Here are the main steps to get on the whitelist for an NFT project:
- Look for an NFT project before its launch.
- Join the NFT project's Discord server.
- Follow the instructions to get on the whitelist.
How to recognize fraud with whitelist NFTs?
The NFT industry is still evolving, and unfortunately, there are scammers operating within it, attempting to deceive innocent users and extract money from their wallets. To protect yourself, it's important to be aware of certain warning signs. If someone claiming to represent a project or a random user asks you for a bribe to be included in a "whitelist," it is a fraudulent activity, as genuine creators of non-fungible tokens (NFTs) do not engage in such practices.
You should also be cautious if you are asked to provide your private key to your crypto wallet or banking details for inclusion in a "whitelist." This is a red flag, and you should not disclose such information. Additionally, if you receive an email, text message, or call from an unverified source claiming that you have been selected for inclusion in a "whitelist," it is recommended to thoroughly verify the project before investing any funds. Trust only official links posted on the project's official Twitter, Telegram, or Discord account.
Is it worth trying to get into a whitelist NFT?
Getting into a whitelist requires a lot of effort, including researching pre-sales of NFTs, consistently investing time in NFT projects, and engaging with the project team members. However, it is still possible to not make it into a whitelist as each project or platform has specific selection criteria. For example, users must meet Binance's requirements regarding BNB and NFTs to participate in NFT token sales using the NFT subscription mechanism on Binance.
Nevertheless, the opportunity to gain early access to exciting initiatives is usually worth it, as you can purchase NFTs at a low price and avoid expensive gas wars and costly transactions on the secondary market. Additionally, users can use whitelists to strengthen their investment portfolios if they have the right plan and are willing to put in some effort.
