NFTs are becoming increasingly popular nowadays in the crypto industry. They are drawing attention from different parts of the world with the huge amount of purchases for digital arts. The NFT of the famous Beeple art was sold for $69 million dollars at Christie’s which positioned him among the top three most valuable living artists. On the other hand, a 12-year old launched his own NFT project called Weird Whales and made $160,000 in 24 hours.
What are NFTs?
The full form of NFT is a non-fungible token. NFTs are digital collectibles and they hold value in the form of cryptocurrency. Non-fungible can be explained as not replaceable or unique. They are rare and unique items such as signed baseball cards or original paintings that are value-holding investments.
For instance, one dollar can be replaced with 100 cents which makes it fungible. Fiat currencies and cryptocurrencies like Bitcoin and Ether are also fungible as they can be interchangeable and indistinguishable from the other unit. But non-fungible tokens are irreplaceable. Another major difference between fungible and non-fungible tokens is, fungible tokens can be divided into smaller parts and still carry all the traits of the original unit.
How to buy NFTs?
OpenSea is the most famous platform for buying and selling NFTs. Other NFT marketplaces like SuperRare, Nifty Gateway, NBA Top Shot, etc also enable buying and selling NFTs. Let us see how to buy NFTs on OpenSea.
- Set up a crypto wallet: Users need to set up a cryptocurrency wallet so that they can store digital assets and perform crypto transactions. Users can have an account on any cryptocurrency exchange but to buy NFTs, a non-custodial wallet is preferred. The most popular and easy-to-use non-custodial wallet is MetaMask. Users need to install MetaMask to create an account. It is available as a mobile application and also as a chrome extension.
- Purchase Ethreum: Most of the NFTs are Ethereum-based tokens. So, most marketplaces accept only Ether as payment to purchase NFTs. Users can buy Ether on MetaMask by paying the network and transaction fee for converting fiat currency into Ether. If they have a crypto wallet on any crypto exchange, they can transfer Ether from that platform to MetaMask.
- Set up OpenSea account: After setting up the MetaMask wallet and adding Ether to the wallet, users need to create an account on the OpenSea platform. Marketplaces like OpenSea are to NFTs just like how Amazon and eBay are to products. After creating an account, users need to connect their MetaMask wallet to the OpenSea account.
- Buy an NFT: Once the account is set up on both MetaMask and OpenSea, it is easy to buy an NFT. Most of the NFT marketplaces work in an auction format. So, users need to submit a bid for the NFT they want to purchase. Some marketplaces also act like crypto exchanges and they use the highest bid and lowest ask for NFTs. To buy an NFT on OpenSea, users need to search for an NFT project and then click on the desired NFT and choose the “Buy now” option. Users need to check out the gas price before confirming the purchase.
How to create and sell NFTs
Users do not need to have extensive knowledge about cryptocurrencies and how they work to create and sell an NFT. But, they need to learn how to use a few tools to get started in the NFT space like using MetaMask wallet. Usually, digital arts are more popular as NFTs though they can also represent physical items. Let us see how to create an NFT and sell it on OpenSea.
- Make a digital art file: Any digital file such as TXT, JPG, PNG, MP3, and GIF can be an NFT. As long as the file is supported by the marketplace, users can create and sell it. Users can make any photo, video clip, an audio file, meme, or sticker as an NFT. By selecting “Create” at the top of the OpenSea page, users can upload an image to convert it into an NFT.
- Creating a collection: After clicking on the “Create” option, users need to open “My collection”. Users would have to give a name and description for the new NFT collection. This process is for just setting up the collection to display their work. Some NFT marketplaces charge a small fee to create an NFT but OpenSea does not charge any fees for the NFT creation.
- Create NFTs: Users would have to click “Add new item” to add NFTs to the collection. On the next page, they will find the option to upload metadata like image, video, or audio file and enter the name of the NFT. Users can also enter any external file links to include a high-resolution image or a personal website, etc, and enter a description. Users can make multiple versions of the same non-fungible token. Including the properties, levels, or statistics of an NFT can make it easier for buyers to filter the tokens.
- Marketing the NFT collection: Marketing the NFTs that were created by users is important to let the world know that these tokens are available to purchase. Promoting the NFTs and building a community will help hugely for the NFT owner to increase awareness. Being active on social media platforms, community groups, having a website, and an email list will help in the promotion of users’ NFT artwork.
- Selling the NFTs: To sell an NFT, users need to log in to their OpenSea account and select an NFT they would like to sell. Once the user locates the item, it will show a “sell” button. After clicking it, the website will take them to another page where the users can define the price and other conditions for the auction. This process might be different in other NFT marketplaces. Ether and ERC-20 are the commonly used cryptocurrencies that are used to purchase NFTs. OpenSea also offers a royalty fee which means each time someone sells the users’ original item, they get a commission.
The popularity of NFTs is increasing rapidly all around the world. Though they are new in the blockchain ecosystem, they are here to stay based on their massive popularity.