A non-fungible token, also known by the acronym NFT, is a special kind of digital asset that has changed the art world by redefining ownership. Fungibility is the ability for one unit of an investment to be exchanged for an identical type and quantity.
Non-fungible tokens are released to be unique and can only be exchanged on marketplaces for another currency.
As a society, we are used to exchanging our money for items that have physical value. This new wave of digital investing has garnished the idea that we can retain ownership rights of an object that resides on the blockchain. NFT are released in specific amounts and this creates a demand once these are no longer publicly available. These prices are dependent on demand which is influenced by media attention, availability, quality, and utility.
NFTs are trending due to many factors. Celebrities have started purchasing NFT such as Bored Ape Yacht Club, Doodles, and many other of these high-value assets to diversify their portfolios. An exponential upward movement in volume and release of these various projects have drawn media attention, provided earnings to investors, and has spread the interest in blockchain technology!
To properly understand how the NFT ecosystem works, we must first approach the flow of money. There are multiple tiers of investment where money can be made.
Artists have been struggling to earn a living on the digital art medium due to the inability to prove originality for decades. These artists can now provide their craft for a service or even release the NFT they have created themselves entirely.
There are large time and money expenses involved with releasing non-fungible tokens. Funds must be allocated to the development of the blockchain contract, advertisements, staffing, art, and other various continuous expenses.
The initial minting, or creation, of an NFT, brings a one-time payment to the creative team that covers these expenses and provides a return on their time and money investments. Royalties are usually placed on the market resale of NFT as well which provides income over time.
Whether you have minted an NFT during a drop or have bought or sold an NFT elsewhere, you are contributing to the volume and flow of the NFT market. Simply put, the more NFT that is bought and sold on this level - the higher prices generally go. As this form of investment becomes more mainstream, there is exponential growth!
We encourage everyone to join a popular NFT secondary market for research on some of the biggest projects like https://NFT-List.io.. There are many projects to choose from and this choice comes down to the individual. As an NFT community, we are on the way to mainstream adoption but we must always remember there is risk involved.
Another option is to use a website such as NFT List to join the social movement for each project and mint on private or public dates.
There is nothing more exciting than a mint day!
A ton of people are bringing up NFT in casual conversation about making money. This is a risk/reward situation and it is important to be educated.
NFT, or non-fungible tokens are individual pieces of transferable collections that are uploaded to the digital medium. As long as a secure connection can be supplied for digital audio or visual asset, an NFT can be created.
Opensea.io is the largest NFT marketplace that specifically services the Ethereum and Polygon blockchains. NFT can be created, and secondarily marketed on this platform. NFT can be sorted by volume, type, blockchain, and price.
Rarible claims to be both an open-source and multi-blockchain equivalent to most NFT marketplaces. Anyone can post NFT on Rarible so care must be given when buying smaller projects. There are also bonuses for participation on the platform.
Solanart is a marketplace that services the Solana blockchain. Projects have to be verified by the marketplace so duplicate projects are less common.
Projects can be sorted by newest or highest volume and there is an option to purchase NFT that lower trading fees.
Buying an NFT gives you a digital certificate of authenticity which is transferred into your wallet. This same source image can be hosted elsewhere but you are the only owner of this specific version of this artwork which is part of a collection.
Each collection of non-fungible tokens has a different policy but most NFT collection creators retain their rights to all licenses and copyrights. Royalties are often paid to specific NFT when their property is used for advertisements but this is not always the case. If you purchase a Disney Blu-Ray - you own the disc itself but not rights to the overall franchise and this correlates to NFT ownership.
All marketplaces that service the blockchain/NFT that you own will have a “wallet connect” option. There will be an option to see your NFT in the menu. The option to sell your NFT should be a menu item that will prompt you for a price. Most often there are fees to list and subsequently sell your NFT so price accordingly.
Buying an NFT gives you a digital certificate of authenticity which is transferred into your wallet. This same image can be hosted elsewhere but you are the only owner of this specific version of this artwork which is part of a collection.
NFT are originally released as a group called a collection and are promoted on social media and websites such as NFT-List before their mint date, or release. The only difference between minting and secondary market is seeing what you get in advance. In most situations, minting an NFT is cheaper but riskier as you never know what rarity you will receive.
Minting an NFT is simple. You will be provided with a website link also known as the “mint page” and this website will allow you to connect your wallet. You then pick how many NFT you are choosing to mint. After clicking mint, a transaction window will appear allowing you to review and confirm the mint and after clicking confirm or accept, you will be transferred an NFT from that collection. Keep in mind that there must be NFT available to mint in the collection, and most well-advertised NFT mints sell out fast! It is fun to see what art you receive after the anticipation of waiting for a mint!
With this knowledge, you are ready to embark on the journey to obtain your first non-fungible token! Good luck!