You no longer need to feel out of place when crypto junkies talk about NFT market around you. Here is everything from what is NFT to how to create your own NFT.
The world has never been so fast. Living in the 21st century is like waking up to a new innovation every day. Whether it is metaverse or cryptocurrency, new trends are emerging each day while others are being outdated at a similarly quick pace. However, there is one innovation that is here to stay- NFTs, and it is better you make yourself well-familiar with this market if you aren’t already.
NFTs already account for multi billion dollar market, thanks to the investors and celebrities. On an average, more than 80,000 NFTs are being sold everyday accounting to multi-million dollar trading volume daily. NFT collection too has registered a massive increase with entry of new and famous players such as Bored Ape Yacht Club, Goofball Gang, SuperRare, NFTWorlds, Genesis Critterz and more.
Not just metaverse, but social media platforms too have jumped onto the bandwagon, authenticating the wave of popularity. Twitter has rolled out the feature where users can not only use their NFTs as their profile pictures, but can also display them on their feed. One can even connect to their Ether wallet through Twitter.
With so much going around, it is obvious that a novice would feel overwhelmed. If you are one among those who have no clue what NFT is, you have landed at the right place.
Most Comprehensive Guide To NFT Market — A Complete Breakdown Of 21st Century’s Buzzword
What exactly is an NFT?
In the simplest terms, NFT or non-fungible tokens are the unique units of data on a blockchain that that cannot be replaced.
What does NFT mean?
Take, for instance, Bitcoin — the world’s largest cryptocurrency can be replaced with or traded for another Bitcoin and the holder will still have the same value in his account. However, this is not the case with NFT. Every non-fungible token is unique in nature and if an investor trades it with another NFT, it would not be same.
Since these tokens cannot be replicated, these are not used for commercial transactions, rather a store of value like artwork or real estate.
Is NFT like a crypto?
Cryptocurrencies and NFTs, both are built on the same technology- blockchain. They both are decentralized unit of data stored on blockchain just with one difference- NFTs are non-fungible in nature while cryptocurrencies are fungible. This means that NFTs cannot be traded for anything else while a cryptocurrency like Bitcoin can be traded with another cryptocurrency and its value will still remain the same.
One can think of NFTs as artwork that is unique in nature and doesn’t have any other replication in value.
Is NFT a good investment?
The answer to the question is, yes. NFT market is highly secure in nature and are the future of collectible in the digital space. Think of it like this- in the real world, investment in vintage cars, artworks, jewels and luxury champagne is a lucrative prospect given that its value increases with time. This phenomenon is the result of the unique nature of these collectibles.
NFTs reflect the same phenomenon on the digital space. Investors, celebrities, artists and speculators have pumped up the value of NFTs by owning them. A single NFT can cost as high as multi-million dollars.
How to make NFT and sell NFT art?
If by now you are convinced about the solid future of NFTs, you probably want to create one and sell it. This is how you can make an NFT art and sell one-
Step 1- Decide what NFT you want to create
It can be anything. Melania Trump recently sold NFTs of her blue eyes while BAYC is selling NFTs of dressed up apes. You can create an NFT of your physical paintings, videos, music, memes, GIFs, and even tweets. Yes, it is that cool!
However, the more unique your idea would be, the more it would be worth.
Step 2- This is not really a step but an essential point to remember- make sure you own intellectual property rights to your NFT in the market. The digital asset should not be owned by anyone else if you don’t want to get in trouble.
Step 3- Now that you have the idea, decide which blockchain technology you want to build your NFT on. Ethereum remains the most popular and convenient choice for artists. Other options can be Cosmos, Binance Smart Chain, Polkadot, etc.
Step 4- Set up your DeFi wallet since you will need to make cryptocurrency transactions to fund your NFT. You can pick from multiple options- Metamask, Coinbase, AlphaWallet, etc.
Once, you have created the wallet, load it with some crypto. Most convenient choice here would be Ethereum since it is accepted on almost all the platforms.
Step 5- The next step is to choose which NFT marketplace you want to trade with.
What is NFT marketplace?
Think of it like Amazon. NFT marketplaces are like huge digital market space where investors and creators can trade NFT.
You can choose from different options again- Mintable, SuperRare, Axie Marketplace, OpenSea, CryptoPunks, Foundation, etc. You need to research before selecting the marketplace since most of these platforms are popular for specific kind of NFTs. For example, NBA Top Shot is centralized to trading of basketball-related NFTs.
On the other hand, these marketplaces sometimes also require their own cyptocurrency to make transactions. For example, to trade on Rarible, one need to buy Rarible crypto.
Step 6- The next task is to connect your digital wallet with the NFT marketplace you have selected.
Step 7- Now that you have been registered to a marketplace and connected your crypto wallet, you can start uploading your digital file according to the instructions of the marketplace you are trading on. Your digital file can be in any format- PNG, GIF, JPG, MP3, etc., and will be later converted to marketable NFT.
Step 8- You have almost made it to the end! The final step is to decide the monetization mechanism. There are different ways in which creators sell their NFTs on marketplace-
Sell it for a fixed price
Arrange limited-period auction
Arrange timeless auction.
However, for all three, you will have to decide the minimum price of your NFT. If you want to continue earning out of it even if the buyer sells it further, set up your royalties.
How much does it cost to create an NFT?
NFTs are a great investment and creators can earn to the north of a million on one artwork. However, creating an NFT can be costly. The first expense would be the Gas fee which is basically the cost of computing energy compensation on the ethereum blockchain. It can cost you approx $70. Then, there is the fee that NFT marketplaces charge for listing. While it varies platform to platform, it can average to $900.
And despite all these expenses, there is still no guarantee if your NFT will sell.