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If you’re ready to buy your first NFT, you need a crypto wallet funded with a currency to make your purchase. Ether is a good choice for buying NFTs.
But if you’re getting started, take care not to invest more than you can afford to lose. NFTs may become more and more valuable over time, but the market could flop as well. Only time will tell the future of NFTs.
If you don’t have tens of millions of dollars to buy NFTs from famous artists, you’re not out of luck. There are plenty of cheaper examples of NFTs you can buy to get started.
It’s important to emphasize the risk of investing in NFTs. While it’s a fun fad today, there’s no knowing what the future holds for NFTs. The market may crash and these expensive purchases become worthless.
The ability to effectively duplicate them is also a huge risk, as people may ultimately decide that “owning” something through a digital wallet doesn’t matter all that much. After all, you can save almost any image file from the internet to your computer and make as many copies as you want using keyboard shortcuts or your home printer.
The main thing sellers get is money, but they may also gain a reputation. Breaking through and becoming a famous artist is difficult in any situation. NFTs democratize the art world by allowing anyone to create and sell art in a public marketplace.
Artist Beeple, the creator of that $69 million NFT, already had some name recognition before selling this record-breaking NFT. In addition to having enough money to buy a private island, Beeple now ranks among very few living artists who have fetched this high price for a single artwork.
Other artists may find their works launch them to fame and even more fortune if their art stands out and resonates with collectors.
Making an NFT is fairly easy for anyone with computer skills. You don’t need to know a lot about cryptocurrencies or blockchain to start. You should however think about which cryptocurrency you want to sell your NFT in. Keep in mind that you can sell your NFT only on platforms that support the crypto you choose.
Just as when you buy an NFT, you need a digital wallet. If you choose to sell on OpenSea, you can use the same wallet you set up to buy NFTs. You need to connect it to your account and digitally sign in to confirm it’s you.
Then all you need to do is create a digital file of your artwork or other items you wish to sell. It can be a photo, a song or even a Tweet.
Once you have your digital file, upload it as described in #4 above. You can even create special traits in the background that only the buyer will be able to see, to add to the uniqueness of the NFT. Click done, and you have your first NFT!
You can buy or sell an NFT on any major NFT platform. There are a few popular ones, including OpenSea and Rarible. Using these platforms, you can create your own NFT or buy and sell other NFTs. Some speculators have made a fortune doing this, but there are certainly risks involved.
First, you need to choose which platform you want to use. These platforms are essentially auction houses. Keep in mind that not all NFTs are available on all platforms. For example, if you want to buy an NBA Top Shot, you need to create an account with NBA Top Shot.
Each platform has different requirements for purchase, such as paying with cryptocurrency or fiat currency.
As an example, we will go into a bit more detail for buying an NFT from OpenSea, which is one of the more popular NFT platforms.
Once you choose your platform and create an account, you need to create a digital wallet for your cryptocurrency. OpenSea accepts ether (a type of cryptocurrency), among other types of digital coins. And OpenSea accepts coins from various wallets. Make sure your digital wallet is secured and encrypted.
Once you have a wallet, you can buy ether (or another cryptocurrency). There are a number of ways to buy ether, including through popular exchanges like Crypto.com and Coinbase. It’s usually easy to buy a cryptocurrency like ether and it’s similar to buying a stock. You will need to use a platform that lets you buy ether, then find the ticker and put in a buy request.
Once you own ether and have stored it in your wallet, you can buy an NFT on OpenSea. Browse the site to see what’s for sale. If you see something you like, place a bid (if it’s an auction) or click Buy Now. Then go to the checkout, pay the fees and viola! you own an NFT.
But what if you decide you don’t actually want to own the NFT you bought? You can easily sell it on the OpenSea platform. You may also be able to sell it on another platform, but the details of how to do so may vary so check with other platforms before you proceed.
It’s pretty simple really:
NFTs don’t change what we view as beautiful art, but it does change how we measure ownership and value. While there’s no debate of who owns the Mona Lisa or other famous physical artworks, we never had such a system for digital ownership.
With NFTs, we can now verify who owns digital work.
Some skeptics say that this form of ownership is worthless as anyone can make an unlimited number of copies of the JPG, GIF or other file represented by the NFT. It’s up to you to decide where you land on that debate and if you think NFTs are good long-term investments or a fad that will go the way of the Beanie Baby and Pet Rock.
NFT stocks provide a buying and selling feature similar to shares of stock. But instead of going through a traditional stockbroker and exchange, NFT stocks are a type of decentralized finance. Anyone in the world with an internet connection and cryptocurrency wallet can buy and sell shares to each other directly without a company in the middle vying for a commission or other revenue.
Just as a digital smart contract address can represent an artwork, it could represent a share of stock. In fact, the New York Stock Exchange has recently launched First Trade NFTs to represent the first true trade of a number of public companies, including Spotify, DoorDash and Coupang.
Cryptocurrency exchange Binance earns the first mover award here, as it already offers tokenized stocks for a select list of companies. However, it’s not currently allowed if you live in the U.S. But that doesn’t mean it won’t be coming to this side of the pond in the coming months or years.
Stock tokens have a unique opportunity to revolutionize how we trade and hold stock investments.
A non-fungible token (NFT) is the digital representation of the asset. Every NFT, like every cryptocurrency coin, has a unique identifier that anyone can use to track its ownership history on a public blockchain.
If you go back to the $69 million artwork, you can view the origin wallet address and the NFT’s smart contract address:
If you know what you’re doing, you can use that information to find the NFT and the wallet that owns it today. Unlike the underlying image file, the smart contract address can’t be replicated and can exist only once on the blockchain.
We’ve mentioned the term blockchain, and that probably has you wondering if NFTs are a kind of cryptocurrency. They work in a similar way, using the same underlying technology. The digital wallet that holds your cryptocurrencies could also hold NFTs.
Like a transaction using bitcoin, ether, lumens, or dogecoin, NFT transactions are tracked by many people using a blockchain.
For example, when someone buys an NFT, a combination of private and public keys allows the seller to hand over the asset to the buyer. When the handover happens, a large network of computers verifies the transaction and the new owner.
The asset is recorded as belonging to a specific wallet, which may be anonymous. As long as you have the public and private keys to your wallet, you’re in control of its contents.
That’s why it’s crucial to keep your wallet information and private keys safe if you’re involved in cryptocurrency or NFTs. If you lose your keys, you essentially lose the underlying NFT. It’s also important to make sure your internet connection is secured and encrypted.