How to Create, Buy and Sell NFTs (Non-Fungible Tokens)
One of the biggest crypto trends right now is the purchase of non-fungible tokens or NFTs. An NFT is stored on the blockchain and used as proof of ownership of a digital asset. While NFTs can be bought and sold, they aren’t used as digital currency. A bitcoin or a litecoin is fungible, meaning that you can trade one bitcoin for another and it’s still worth a bitcoin (of whatever that amount is relative to a fiat currency).
If you’re interested in NFT tokens, here’s what you need to know about how to buy and sell NFT assets and how to create NFT art in case you want to sell your own.
What are NFTs? NFTs explained In 2 minutes
Non-fungible token (NFT) is a non-interchangeable unit of data stored on a blockchain, a form of digital ledger, that can be sold and traded. Types of NFT data units may be associated with digital files such as photos, videos, and audio. Because each token is uniquely identifiable, NFTs differ from blockchain cryptocurrencies, such as Bitcoin.
NFT is a way to prove the rights to a virtual object and make money on it. The technology is so mainstream that it even managed to get on TV. The solution is breakthrough - still slightly overrated.
NFTs are non-fungible digital assets mostly referred to as ERC721, ERC1155 on Ethereum, BEP721 and BEP1155 as NFTs on BSC that are either unique or limited in quantity. Think of them like you would a famous painting by Picasso or the video game Gamma Attack for the Atari 2600. NFTs are like vintage baseball cards but only in a digital form that is unique, non-fungible and secured using cryptography. Usually, crypto collectibles are represented as real-life objects such as pets or avatars. Some crypto collectibles are computer generated works of art. Each token has variations in specific attributes and there are limits to the number of tokens that can be generated.
An NFT token (non-fungible token), is a digital certificate that guarantees the authenticity and gives exclusive rights to its holder. This idea is a result of the cryptocurrency world.
Non-fungible tokens are not able to be replaced, duplicated, or substituted. This system can be used to secure rights to unique objects such as a work or art, piece of real property, or digital artifacts from computer games.
Every record in the digital blockchain is a token is a record in the digital ledger. All tokens or records in an open blockchain can be viewed as equal, fungible coins with the same monetary denomination. Cryptocurrencies are based on the concept of fungibility. This means that a bitcoin can be replaced easily by another bitcoin without affecting the overall portfolio value or position. Any bitcoin is the exact same as any other bitcoin.
The Non Fungible Token technology (NFT), however, is a game-changer and works in a completely new way. Non-fungible tokens are digital coins that can't be replaced with another token, without changing its value or essence.
NFTs, much like cryptocurrency, are created on the blockchain. The blockchain acts as a recorder for all transactions. The blockchain ensures that non-fungible tokens are authenticated. The blockchain guarantees that digital items (e.g. The person who mints the NFT actually owns the digital item (e.g. This system allows anyone to check the authenticity and historical history of any NFT via the blockchain.
The NFT token is essentially a purchase of a certificate that can be used to create a work or other physical item. The NFT item does not travel anywhere.It is permanently stored on the InterPlanetary File System, which is a peer to peer file storage network. The NFT (or certificate) is essentially a string of codes that confirms that the token's owner actually owns the object. An NFT token can be thought of as a painting that is owned by a gallery, museum or individual. However, the audience might still view it in a catalog, exhibition or catalogue. Even if someone downloads an image of this painting from NFT, they still own the rights to the original piece of art.
NFT tokens can be sold on online marketplaces similar to Amazon, except that all payments are made using cryptocurrencies and are transparently registered on blockchain. These NFT marketplaces are where NFT creators can sell their creations (e.g. OpenSea, Solsea, Rarible etc.) Wait for buyers to offer.
NFT, in general, is a way for creatives and entrepreneurs to monetize their talents and expand their audiences. Artists can sell their art digitally by using NFTs because they eliminate the logistical problems of shipping and receiving physical paintings.
In this Guide:
What Are NFTs Used For?
Although we talk about how to buy NFT tokens and consider them as an asset, NFTs are actually proof of ownership. When you buy a digital asset from someone else, the NFT comes to you as proof of that ownership. While the world of digital art and music has received a lot of attention — as well as sports moments — NFTs can be used for just about anything.
It’s possible to produce NFTs to represent digital goods and items in video games and virtual land simulations. It’s even possible to use NFTs to manage ownership of real-world items. Wineries are using NFTs as digital provenance for collectors, and it’s possible to represent real estate and cars with NFTs. Even tweets and memes can be sold as NFTs.
Who can be Interested in NFTs and why?
The general NFTs audience includes artists, creative industry brands, and gamers, but that does not mean that if you do not belong to these categories that you would not find anything interested there for yourself. You still can buy some digital asset or even become a digital artist, as this market can allow you to sell a great variety of different things that would not be considered as art anywhere else! Not all NFTs are equal in popularity and pricing, but all can find their place in this NFT world!
1. For Artists
NFT marketplaces are another great place to spread artists' work, get some feedback and receive additional money. In addition, you can receive some percentages out of every resell of your own original NFTs. It can be a simple Photoshop-made picture or a GIF, as well as a more serious piece of art: anyone can find him or herself a place to get noticed!
Widely known artists can use NFT space to gain some extra money out of their NFT sales: as they are already famous, they can put pricing that is on average higher than others. Also, digital platforms let artists become more known, as the information can be spread much quicker. With this fact in mind, now it can be easier for digital artists to gain popularity and increase the prices.
However, we cannot say that this is an always present tendency: there were cases when digital artists made a huge profit from their first NFT sales.
Talking a bit more about the opportunity to make more money out of every resell of your artwork, with which the NFT market and its smart contracts provide you, here is a more specified explanation of how it works: when an artist is selling his or her piece of work, it later could go on the secondary market, where the art would be sold for the second or more time.
In order for the artist to receive some profit percentage out of it, a smart contract is needed!
2. For Gamers
To top off all of the previous stuff mentioned by us, a great change was made for game players and artists related to this sphere: in the past, gamers could only make in-game purchases that still belonged to the company that created the game and could not be used anywhere outside this platform.
Now, when NFT tokens have stepped into the digital market, artists can create and sell digital art that is game-related, and they will constantly belong only to the players. Gamers can also notice how the market has been changing with NFTs: now, many games are created based on in-game NFTs.
Moreover, some moves are starting to appear in regard to creating TV shows related to NFT! There is one TV show that is still in the making process, and another one called the Stoner Cats, with only one episode available at the moment. This last TV show stars some quite popular actors, such as Mila Kunis, and requires you to obtain an NFT token in order to watch it.
3. For Brands
The non-Fungible Token platform is also a great opportunity for different brands to gain additional money selling your work, as well as attract more customers.
For example, Taco Bell company created their own GIFs on one of the NFT marketplaces that were sold within the first 20 minutes after their publication. And now, these same cards are being resold on the secondary market for the price of 3,500 dollars!
First and historically important online events can also be sold now, as it was done with the first Tweet of the co-founder of the Twitter social media, Jack Dorsey, for almost 3 million dollars!
NBA also has its own NFTs products, such as NFT cards with important for the fans' events. These sports cards are very popular within the basketball circle!
As you can see, NFT space can be a wonderful additional source for gaining a profit, and not only for the art creators and musicians but for the already existing brands and companies too.
4. For Buyers
And, of course, we could not forget about our buyers - the people that support their favorite artists and help the platforms stay alive!When purchasing an original piece, you are able to do whatever you want with it:
- Resell it,
- Simply keep it to yourself and enjoy this "possessing" feeling,
- Post it online without having to worry about copywriting rights,
- Or anything else that your soul desires: even destroying it!
As we have mentioned earlier, buying an original gives you certain privileges, like actually obtaining the rights of ownership that can be proved by the information from the Ethereum blockchain, for example, in which the artwork was registered.
Some might want to collect certain digital assets in the hope that later they will become more valuable and could be sold for a big amount of money. Or simply keep the collection to themselves, as many collectors of physical art do.
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How NFTs are being used
The number of potential use cases for NFT continues to grow with time, and ever more innovative examples appear regularly. Nonetheless, there are a handful of particularly popular use cases, as highlighted below:
In-game assets: NFT can represent in-game items, such as weapons, powerups, vehicles, characters, and more. Using the item could burn (destroy) the NFT, or lock it up using a cool-down timer until it can be used again.
Trading cards/collectible: Right now, a large proportion of NFT represent crypto collectibles such as Cryptokitties, Axies (Axie Infinity), Cryptopunks, and sports trading cards.
Land ownership: In Decentraland, NFT represent parcels of land in different districts of the virtual world of the game. LAND owners can build on and monetize their plot, such as by leasing it out to other players or using it for advertising.
Domain names: NFT are currently being used as blockchain domains—essentially tokens that represent ownership of a particular crypto domain, such as name.eth or token.crypto.
Works of art: NFT can represent individual works of art which have been tokenized and are now represented by a unique token. Ownership of the NFT equals ownership of the underlying work of art.
Like standard digital assets, NFT are also used as speculative investment instruments, which are traded on NFT marketplaces like OpenSea and The Sandbox—usually by experienced traders and investors.
How to Create NFTs
Creating NFT art and other items is fairly straightforward. It’s important to note, however, that NFTs exist on the blockchain on which they’re created. Ethereum is one of the most popular platforms for NFTs right now, but you can also create them using Binance Smart Chain, EOS, Polkadot, Tezos, Dapper Lab's Flow, and others.
When you create an NFT, you can only sell it on a blockchain that supports the assets used to create it. So, you need a wallet that supports those assets as well. Next, you can go to a marketplace that allows you to create NFTs and connect your wallet. On some marketplaces, it’s as simple as clicking on a “Create” button and uploading your file, whether it’s an image, GIF, 3D model or some other item. Each platform will have its own way of creating NFTs, so make sure you check the details.
You can add traits, offer special discounts for services or attach other values to the NFT. You can also price your NFT, including any royalties you want to get if a buyer decides to sell the NFT again. Once it’s created, you can sell it.
What Is the Cost of Creating an NFT?
Some platforms allow you to create NFTs for free, while others charge a fee. On an Ethereum-based marketplace, you might have to pay for “gas,” which is a fee charged to perform certain functions on the blockchain. The gas costs more during times when there’s more activity on the blockchain and less when there's not as much happening. Usually, you need to pay these fees with tokens accepted by the platform.
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How to Buy & Sell NFTs
How to Buy NFTs
If you want to learn how to buy NFT tokens instead of just creating and selling them, the process is similar.
- First, decide on a marketplace and find out which coins are accepted as payment. It’s important to know which tokens and wallets are compatible with the marketplace because you’ll need to connect your wallet and make sure it’s funded with the right tokens.
- Next, you need to understand how NFTs are sold on the platform. For example, at NBA Top Shot, “card packs” are dropped and you have to be ready to buy them using your Dapper wallet. Some artwork is sold the same way on other platforms.
- Finally, when everything is in place, you can buy NFTs by transferring coins out of your wallet and using them to pay for the NFT.
How to Create a Digital Wallet to Buy NFTs
A digital wallet is needed to buy digital assets. One of the most versatile wallets is offered by Coinbase. Other wallet services like MetaMask and Trust Wallet also make it easy to buy NFTs. If you’re buying something on a specific blockchain platform, find out what wallet they offer. You can then sign up, create your keys, then fund the wallet by using fiat currency or another cryptocurrency to buy the needed coins for the platform.
D’CENT Wallet now supports NFTs on the Polygon, Ethereum & Klaytn blockchain!
Non-Fungible Tokens (NFTs) on the Polygon network is now supported on D’CENT Wallet’s Collectibles Tab. This update brings to total of 3 different blockchain networks (Polygon, Ethereum, and Klaytn) that D’CENT Wallet users can manage NFTs to Receive, Showcase, and Send from the Collectibles Tab.
D’CENT Wallet is created by IoTrust (Korea), a company founded by security experts with over 15 years of security know-how and engineering experience in developing deeply embedded security solutions based on secure-chip technology (SE and TEE). D’CENT Wallet aims to protect users’ digital assets by combining software and hardware security solutions. Users have the choice of using the Biometric Wallet, Card type Wallet, or the Software Wallet.
Where to Buy and Sell NFTs: Places Where you can Purchase Non-Fungible Tokens
There is quite a big variety of platforms with blockchain technology that you can consider as the place for you to find some NFT art or make NFT sales, but they may differ in the type of NFTs that are allowed in there and in the way new members can access the platform.
In general, we would recommend you to start with some of the most popular platforms that cover the biggest amount of different types of NFTs and let almost anyone visit them. Also, do not forget that different platforms may demand different types of digital wallets and cryptocurrencies, so be ready for that when a marketplace is already chosen by you.
In addition, you may see that many platforms allow creators to publish NFTs in drops, which is done in order to control the level of demand that can be constantly present in the marketplace. So when you have found some interesting piece of art, make sure to get everything ready: from creating a crypto wallet and making a platform registration to purchasing a decent amount of cryptocurrency. Otherwise, you may lose your chance.
Here you can find a list of some quite popular platforms with a user-friendly interface and different types of Non-Fungible Tokens allowed;
If you’re looking for where to buy NFT crypto, you start with a marketplace. Some of the common marketplaces for NFTs include:
- BakerySwap
- OpenSea
- Nifty Gateway
- Foundation
- SuperRare
- Rarible
- Axie Marketplace
- NFT ShowRoom
- VIV3
Some of these marketplaces, like OpenSea and Rarible, also make it easy to create your own NFTs to sell. For investors, the idea is to try to buy an NFT for a good price and sell it later at a higher price.
How to Sell NFTs
Once your NFT is listed on a marketplace, it can be sold. You need to set a price or determine whether you want to use an auction. It’s also possible to set it up to receive royalties for NFTs sales, providing you with a commission when a new person buys the asset. This can be a way for artists to generate income streams without the need for an intermediary or a gallery.
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Pros and Cons of Buying NFTs
Pros
- NFTs are completely unique and can’t be replicated like a JPEG or MPEG.
- You can support creators because it allows them more control over their art.
- NFTs could potentially increase in value, providing a profitable alternative investment.
Cons
- There is no guarantee NFTs will catch on with the mainstream and you might be unable to sell your NFTs, resulting in a loss.
- NFTs aren’t fungible, so they aren’t used as a widely accepted medium of exchange.
- There’s a lot of price volatility with digital assets, so it’s hard to know when to buy and sell at a good price.
Are NFTs Worth It?
Whether NFTs are worth it depends on your own situation and investment goals. If you want to own unique digital assets, NFTs can be a worthwhile investment - especially if you’re interested in collectibles and artwork. So if you can get an NFT at a good price, perhaps through a card drop, then sell it for a higher price, it can be a profitable investment.
If you lose money, NFTs may not be worth it, especially if you’re more interested in the investment aspect and less interested in the collectible aspect. Understanding your goals is an important part of deciding whether any investment or speculation is worth it.
How to choose an NFT Marketplace for you?
The Bottom Line
Non-fungible tokens (or NFT) are unique blockchain-based tokens that can represent practically anything - including physical assets.
Most are based on the Ethereum blockchain, but some other blockchains also support NFT - such as TRON and NEO.
A large proportion of NFT currently represent in-game items and crypto collectibles, but they have innumerable potential use cases, many of which are currently being explored.
Non-fungible tokens, or NFT for short, have been gaining considerable popularity in recent years due to their potential to tokenize practically anything, and confer true ownership of digital assets to holders.
NFTs offer interesting possibilities for the future, whether it’s an application in supply chain management or a way to produce artwork and music. NFTs can also serve as interesting potential alternative investments, similar to investing in art, comic books, and trading cards.
Note: Before you find out where to buy NFT and spend money, it’s important to understand your investment goals and ensure that NFTs fit into your portfolio strategy. Additionally, carefully consider how much money you can afford to lose and think about whether it makes sense for you at this time. Because digital assets are so new, it’s important to only risk what you know you can lose.
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