NFT is a new trend in the crypto industry that is in its very early stages and quickly gaining momentum. While most people even within the crypto understand NFTs well enough, there is a lot of money to be made by smart investing. The global art industry saw sales of $50 billion last year alone. This only accounts for the known sales. For the art that’s never sold and held by collectors for years, the market is easily worth trillions of Dollars. NFTs are looking to carve out a space in a similar industry, by opening it and democratizing it for everyone.
If you’re looking to create your own NFT, check out our complete guide here. However, this guide is for effectively trading cryptocurrencies.
What makes NFT Valuable?
NFTs are linked to your wallet and prove their uniqueness. If you’re looking to trade NFT for a profit, you should be looking into the future and answer the simple question: Will this piece of art be more valuable in the future?
Looking for the right narrative
The process of looking into the future is the narrative. NFTs started off with simple artworks. So the value of it was driven by the artist itself. If you’re buying NFT from a famous artist, the chances are that the value of it would go up. If it’s not from a famous artist, you’re betting that the artist would become famous in the future.
However, the NFT landscape has completely changed over the last few months. It has moved on from artwork to collectibles and games. When it comes to both, it is the community that drives it.
NFT collectibles are auto-generated collectibles that have different traits, resulting in different levels of rarity. Some examples are Cryptopunks and Bored Ape Yatch Club (BAYC). With the popularity of these projects, there has been an explosion of crypto collectibles. So you should really be looking for the best communities that drive the value of these collectibles.
NFT games are also not new. However, their popularity has increased immensely as the games have gotten better. One of the best examples is Axie Infinity. The fun factor and the community behind the game have driven the price of Axies through the roof!
Discovering new NFTs and buying them
The best way to discover new projects is to get involved with them and the NFT community. You need to get on Twitter and start following # NFT and other related threads. Also, a lot of the discussion happens on their respective Discord Servers. So if you’re interested in a new project, get involved with it in their Discord Server and gauge the community.
However, if you’re looking to get involved with an existing project, you should get started with OpenSea. OpenSea is the largest third-party marketplace for NFTs. While you can buy NFTs here, it also provides a lot of additional valuable information.
In OpenSea, you can open the Stats page to look at the recent trends. The best part of NFTs is that all the information is available online. If OpenSea has a particular piece of NFT that you’re interested in, you can look at its complete history. You can look at the history of its sales, current offers, and the asking price if the owner is looking to sell. With some NFTs such as this piece from CryptoPunks, OpenSea also provides additional information such as their properties.
Setting Up Ethereum Wallet to buy NFT
In order to buy and sell NFTs on the Ethereum Chain, you need to use a wallet that can connect to web apps. The most popular wallet for this is Metamask.
1. Download MetaMask for Google Chrome.
2. The initial setup is straightforward like any other wallet. Set a password and make a note of your backup phrase. Now it is ready to be used with Ethereum Chain.
3. Load up your wallet with ETH. If you dont already have Ethereum, check out our guide on buying Ethereum in UK.
Buy NFT in UK
Currently there are two ways to buy an NFT: Mint or buy on a secondary marketplace.
Minting is the proces of buying an NFT straight from the creator. Unfortunately, there is no one place to mint and discover projects. Check out NFT Calendar to know about the upcoming NFT projects that can be minted. Not every project is a good project. Make sure you do enough research before you mint.
The other way of buying an NFT is through a secondary marketplace. It includes platforms such as OpenSea and Looks Rare. It is a straightforward process of clicking on Buy Now and approving the transaction on Metamask.
Sell NFT in UK
Selling NFTs is also a very straightforward process like buying. Open an NFT that you already own and hit sell.
On the next screen, you can set the price, type of sale, and the duration. You can either set a fixed price, or let people bid on your item with a minimum bid price. You can set both a traditional auction or a dutch auction. Finally, you have to set a duration for how long the sale is going to be. Also take note of the fees. OpenSea takes a flat 2.5% fee, and the NFT creator takes anywhere between 0-10%.
Once you’ve filled in everything, take your time to double-check everything because once you list and you realize you’ve made a mistake, it costs to take the listing down.
Future of NFTs
It is still extremely early days for NFTs, and we are only just getting started. There’s a lot of opportunities to make money and have fun at the same time. A lot of collectors buy NFTs to be a part of the community. With that, practice caution. With every new industry, there will be good projects, bad projects, and also scams. However, don’t let that scare you from getting into amazing opportunities.