The following discussion will focus on the importance of NFTs and offer an outline of how one can buy and sell NFTs.
Non-fungible tokens are recently taking the collectible and digital art industries by storm. All of a sudden, any form of a digital artist is finding new opportunities to showcase their art and get a hefty price for it. Not only digital artists but even celebrities and other multinational industries are also joining in to secure their spot in the digital assets front. Recently, the record-breaking auction of a non-fungible token or NFT art for $69 million Ethereum is the reason behind the sudden surge in popularity of NFTs.
Digital artists like Beeple are now using NFTs for releasing their artwork, and blockchain can verify whether the price is authentic or not. But NFTs are not limited to digital art only. There are many ways to use NFTs, such as it can be ownership of any rare and unique items even if it’s another form of asset. It can also have a physical form, so NFTs are not all subjected to digital form only.
Investing in Non-fungible tokens is not similar to investing in cryptocurrencies. Every NFTs is different, and it will come with different valuations and pricing. So, to buy and sell NFTs, you need some form of media attached to them to increase their valuation. Judging from all the attention to NFTs, many are now confused about how they can buy and sell NFTs. So, this guide will focus on the process of using NFTs as a form of investment and help you realize how you can buy and sell NFTs to reap the benefits of this new opportunity.
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What Are NFTs?
First things first, let’s start with a proper definition of NFTs. If you don’t understand what an NFT is, then it’ll be even harder for you to comprehend the process to buy and sell NFTs.
Typically, non-fungible tokens are a form of blockchain-based tokens. More so, there are always various assets attached to them, which you can authenticate using blockchain. Non-fungible tokens help to ensure authenticity to any digital file/asset and help you to reduce the risk of counterfeit. Therefore, every single token is unique and one cannot be interchanges with another token.
You might think that you are paying a hefty amount of money for just a digital copy of an image. Well, let’s explore it using an example. Think of NFT as a piece of art. In reality, when the artist is making the art, you can buy it from him/her and own that piece. Even if you didn’t make it, now you can use that piece of art any way you want.
NFT is exactly similar to it, but it’s digital rather than physical. If you believe that NFT is just a PNG file, then you are saying that the traditional painting is just random colors on a canvas. In reality, any art’s value comes from the artist’s perspectives and the media attached to it. Other than art form, there are various NFT use cases in many industries. Therefore, in order to buy and sell NFTs, you have to understand the underlying value of non-fungible tokens and how they get value in the first place.
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How to Buy NFT
If you want to know how to buy NFT, then you need to follow certain steps. Before you can buy any NFT, you need to figure out where NFTs are being sold in the first place. As it’s a blockchain-based token, there are marketplaces where you can buy and sell NFTs. So, before going further, we’ll point out some of the popular marketplaces for you.
Where to Buy NFTs
Various marketplaces online can offer you a platform to buy and sell NFTs. But not all marketplaces offer the same type of collectible or arts. Therefore, based on the marketplace you choose, you can purchase a certain type of collectible. Most of these marketplaces have a wide range of NFTs that you can buy, but every platform works a bit differently.
If you are confused about where to buy NFTs, then here are some of the marketplaces that you can use to buy and sell NFTs:
OpenSea is a wonderful NFT marketplace that uses Ethereum. More so, users can use crypto to buy non-fungible tokens. It offers a lot of collectibles, starting from artwork to video games. However, to use this platform, you will have to get a blockchain wallet like Metamask. OpenSea supports a lot of blockchain wallets such as Metamask, Trust, Coinbase, Argent, and so on. This is one of the top platforms where you can buy NFTs.
SuperRare is another good platform for buying NFTs. Here, all of the pieces are unique, and people can sell and buy all the tokens from their platforms. More so, this platform uses the Ethereum network, so you need to buy Ether in order to purchase any piece of item from this site.
CryptoPunks is one of the rising stars at the moment. It’s a bit different than other NFT marketplaces. In reality, these are mainly 24×24 pixel images. All of the images are generated automatically, using algorithms. Most of these images are girls and guys that look like punks, but there are rarer items such as zombie punks or Alien punks. Anyhow, all of the punks have their very own portfolio where you can see their characteristics and ownership status and whether they are up for sale or not.
This is somewhat similar to CryptoKitties, where every single item is unique. Similarly, here every single punk is different. In this marketplace, you can buy punks, bid on them, and auction them at a higher price.
Rarible is quite similar to OpenSea and plays an active role in token-based blockchain digital transformation. In this marketplace, you can also create, buy, sell, bid on art pieces. All you have to do is take your digital content and create an NFT on this platform and auction it. People who want to buy these digital images can bid on them, and the highest bidder gets the ownership of that image. Also, you can create more than 1 NFT for a single image for selling purposes and sell it multiple times. More so, you can even receive a percentage for resales.
Sorare is specifically geared towards soccer cards. This platform offers buying and selling of limited-edition digital soccer cards. At present, there are 125 clubs enlisted in the marketplace, and they are adding more and more every week. If you are a soccer fan, then Sorare is the perfect NFT marketplace for you as you can buy your favorite players’ soccer cards.
Now that you know where to buy NFTs let’s move on to your account.
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Creating and Funding Your Account
You can choose any NFT marketplace and create an account. However, before you can buy or even sell anything, you need to connect to your blockchain wallet. As most of the NFTs are Ethereum-based, most of the marketplaces accept Ether as a viable payment. To buy Ether, you’ll need an account in crypto exchange and then send the crypto to your blockchain wallet.
Once you have enough funds, you can go ahead and connect your wallet to the NFT marketplace account. There, you are done! Now you can buy NFT anytime you want!
Well, as you already know, to buy and sell NFTs, you need to have a blockchain wallet that possibly supports ERC standards such as ERC-721 and ERC-1155 standards. Both of these are specially geared for NFTs. However, ERC-1155 is fairly new, so some of the popular wallets still may not support it.
Anyway, to help you out, we’ll list some of the blockchain wallets that you can use to store your NFTs and other cryptos in order to buy NFT. Most of the NFT marketplaces support these wallets.
MetaMask is one of the popular decentralized finance applications that use the Ethereum network. In reality, you can use this wallet as an extension to your browser, such as Firefox, Chrome, and so on. Using Metamask, you can access your funds and other Ethereum based tokens.
If you are a blockchain developer, you can also access the test network using MetaMask. Furthermore, MetaMask lowers entry barriers for people interested in Ethereum by offering an abstraction to the users. You can store your NFTs in this too. More so, all your private keys are fully encrypted and stored on the device. You can access the keys whenever you want and accept or reject your NFT sales.
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Coinbase wallet is another popular one among the NFT platforms. It supports multi-coins, any kind of digital collectibles and offers secured storage. There is one definitive change here. Instead of using only addresses, you can transact using your Coinbase wallet name. In reality, it comes in a standalone app format, which makes it even easier for you to use as you can install the app on your mobile devices as well.
Buy Your NFT
This is the last step you need to take in order to buy NFT. Once you are done with funding your wallet and account, the buying process is quite simple. Most of the NFT marketplaces have auction mode, where you can submit your bid and wait for a certain amount of time to see if you got the piece or not. Sometimes an auction can go on for days, and if you really want to buy a piece, you’ll have to outbid the highest bidder.
On the other hand, buying an NFT from the primary marketplace is a best practice as the resale value is quite high when you put it up for sale on another platform. Well, there are certain downsides to it as well. In any case, it’s hard to predict how the evaluation of the NFT will be as the demand can increase or decrease at any moment.
Now that you know how to buy NFT, it’s time to understand how to create and sell NFTs on these marketplaces.
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How to Create and Sell NFTs
In order to sell NFT, you can go on 2 different paths. First of all, you can buy an existing NFT piece and then sell it in another marketplace. Secondly, you can create your very own NFTs and then auction them and sell them in other marketplaces. We already covered the process of buying NFTs. So, now we will discuss how you can create your very own NFT.
How Are NFTs Created?
Well, creating NFT is a very easy and simple process. For this, you will need to create an account in a marketplace that will let you create your NFTs. Marketplaces like Opensea or Rarible let users buy and sell and even create NFTs. The best part is that you won’t need any knowledge of blockchain or cryptographic hashing to make the ERC-721 tokens.
The platform will take your image, video, 3D models, or any other asset and turn it into NFTs. It’s a different kind of asset tokenization. Well, for an NFT to have value, the media needs to be connected in some way. An artist’s reputation is what gives an NFT the value it deserves.
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How Much Does It Cost?
Typically, some platforms may charge you a small fee for making NFTs. But in Opensea, you won’t need any costs to make an NFT. There is only a one-time gas fee there that is required for making your very first NFT, and the rest are free. If the marketplace is using Ethereum NFTs, you will need “gas” to create the tokens.
The cost of Ethereum gas will vary depending on the network. Typically, the more people are on the network, the higher the gas price. We suggest you try it out during the weekend when fewer people are on the network.
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Can Anyone Make An NFT?
Well, there is no limit to who can make an NFT or who can get access to the marketplace. It’s open for everybody. To buy or even sell NFTs, one only needs an account. The buying process is much simpler than selling because you know how much that value that token offers. However, when you are creating your very own NFTs, the valuation is not the same.
Not just anyone can go and create an NFT and expect a good valuation for their hard work. It’s kind of similar to how artists in real-life work. If you are not popular, then it’s harder for you to make a sale.
On the other hand, the hidden fees in various sites can become quite complex. Even if you manage to sell one, sometimes, the hidden fees can amount to more tokens than you are initially getting in your sales. So, in this case, you’ll sell your tokens at a loss. We suggest doing thorough research on the platforms and creating a fanbase before you start minting your NFTs.
The Process of Selling NFTs
It’s time to understand how you can sell NFT from your collections. To sell NFT, you need to go to your account and locate the piece from your collections. Once you locate them, you need to click on them, and it will reveal a “sell” button. Once you have this option, you can click it, and it will take you to another page where you can define the pricing and the conditions for the auction.
The process is a bit different in all marketplaces. Ether or ERC-20 is one of the common tokens you will get if you manage to sell your NFT. Platforms like Opensea offers a royalty fee where you can get a commission every time someone sells your original piece.
Now that you know how to create and sell NFTs, you can start your endeavors anytime you want!
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The popularity of non-fungible tokens is increasing at a rapid rate. It’s a new way one can sell their digital valuables with proper authenticity online. Even though it’s a completely new front in the blockchain ecosystem, we can assume they are here to stay judging by the massive popularity. Many industries are already using this new form of token to implement blockchain solutions.
We’ve covered everything you need to know about how to buy and sell NFTs, and hopefully, it can help you out. In any case, if you are interested in learning about the concept behind NFTs, which is blockchain, then you should enroll in our blockchain certification courses.
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*Disclaimer: The article should not be taken as, and is not intended to provide any investment advice. Claims made in this article do not constitute investment advice and should not be taken as such. 101 Blockchains shall not be responsible for any loss sustained by any person who relies on this article. Do your own research!