NFTs may not be as popular as cryptocurrencies. However, there’s no doubt that they may be equally, if not more, profitable in some instances. After all, the world has witnessed an NFT sale valued at $69 million. Furthermore, you or anyone else may create NFTs to earn profits. This article explains how to buy NFT and also covers everything to know about this unique blockchain tech.
What Is an NFT?
An NFT (non-fungible token) refers to a vast range of virtual assets, including both tangibles and intangibles. An NFT may be a digital sneaker pair, digital real estate, or collectible sports cards. The primary essence of NFTs is to store artistic or cultural values.
- Non-interoperable: NFTs work only on specific platforms; in other words, an NFT can only function on the particular platform it was designed for. A Gods Unchained game card is inaccessible or unusable in the Blockchain Heroes game. Likewise, a CryptoKitty is not usable on the CryptoPunk application or vice versa.
- Indivisible: Unlike Bitcoin satoshis, you cannot break an NFT down into smaller portions for any reason. NFTs exist solely as non-divisible items.
- Indestructible: You cannot destroy, replicate, or remove an NFT. Why? NFT data keys directly into smart contracts. What’s better? NFT ownership is unchangeable, meaning collectors and investors wholly control and own their tokens, instead of their creators. In contrast, buying a product from the iTunes store doesn’t make you the original owner. You merely own the license to use the service for a specified period.
- Verifiable: The use of smart contracts for NFT technology ensures that information remains forever. As such, digital artwork and similar items are traceable to their original designers. This feature allows for data verification without third-party intervention.
Mechanism Behind an NFT’s Operations
Think of NFTs as artwork that you may create, buy, or sell.
NFTs are established on the ETH protocol as unitary tokens containing additional information, like a flash drive containing secret coordinates. Although, it’s impossible to get the exact value of an NFT even if you get a similar copy. Think of this concept the way duplicate copies of art prints contain the same information, but does that mean they are as valuable as the original?
These data may be music, video, images, or other art forms stored as MP3s, MP4s, JPEGs, or GIFs. NFTs hold information, which may be as important as a secret government project or as common as a gaming card. Therefore, the creator may sell them according to the price fixed by market demand.
It’s noteworthy that while you may conveniently download an NFT image through right-clicking, the downloaded file won’t contain the data that makes it valuable.
Differences Between NFTs and Cryptocurrencies
Some characteristics differentiate NFTs from cryptocurrencies, with blockchain programming the only similarity between the two. Let’s check out some of these differences.
- Cryptocurrency Is Fungible: Fungibility describes the interchangeable nature of an item. Thus, cryptocurrencies are exchangeable for one another. You may exchange Bitcoin for Ethereum and vice versa on both decentralized and centralized crypto exchanges.
- Cryptocurrencies Are Measurable in Equal Value: Two cryptocurrency measurements may be equal in value. This means that one BTC is equal to one BTC, whatever the circumstances may be. Likewise, one ETH equals one ETH. In essence, two different cryptocurrencies (LTC and DOGE) may have the same value if correctly measured. As a result, cryptocurrencies are an acceptable payment means worldwide.
- NFTs Maintain a Virtual Signature: The use of smart contracts in NFTs ensures that data is encoded while the creation remains that way for eternity. Some users optimize this feature to write their signatures on their products before selling them. That way, everyone who buys a copy knows the product’s original creator.
- NFTs Aren’t Measurable in Equal Value: Unlike cryptocurrencies (and fiats), two different non-fungible tokens never have the same value. For instance, there’s no way to equate the value of one EVERYDAYS to one NBA Top Shot clip despite both being NFTs. You and another party may agree to barter, but others may not agree to the value measurement.
- NFTs Aren’t Tradable Assets: Cryptocurrency trading is the most reliable way to earn with cryptocurrencies. However, that’s not possible with NFTs due to the absence of a system to measure two different products equally. You may equate some BTC satoshis to one ETH, but that’s impossible with NFTs. Consequently, automated crypto trading systems that simplify crypto revenue generation (Obolon9, for instance) do not support non-fungible tokens.
Special Use Cases of NFTs
- Optimizing Digital Content Creation Earnings: Typically, creators cede ownership of their content to the platforms where they publish them. Therefore, these creators get publicity but low profits from their sales in most cases. Fortunately, an NFT provides a better option. Content developers may now code their metadata into their products, such that every sale earns credit to their wallets directly. Also, they may earn commissions when others resell.
- The Copy/Paste Debacle: The introduction of NFTs ensures that creators don’t have to bother about people copying and pasting their artwork. Their signatures remain on the products, and a screenshot doesn’t contain the valuable data they encoded during creation.
- Improved Gaming Potential: Players can now benefit from NFTs through ownership records to fuel in-game economies and in-game assets. Moreover, you may resell gaming NFTs after completing the game to recoup your investment.
- More Remarkable ETH Addresses: You can modify your ETH wallet address with NFTs such that it’s easier to type and remember. Such wallets are written as yourwallet.eth instead of xx324…456. These wallets may save arbitrary data like your Twitter handle and email address.
- Physical Items: Serious projects are underway to tokenize physical assets, such as rare fashion items and real estate properties. NFTs may become the control of your home or car in the foreseeable future. Plus, you may present NFTs as loan collateral as well.
- DeFi and NFTs: Both blockchain technologies are starting to combine for excellent results.
- NFT-supported Loans: Some DeFi applications now accept NFTs as collateral instead of cryptocurrencies.
- Fractional Ownership: Although an NFT is indivisible, you don’t necessarily have to buy its whole form. You may buy a fraction and trade NFT crypto securely on DeFi platforms.
How to Buy NFTs Securely and Conveniently
Create an Account on an NFT Marketplace
There are numerous NFT marketplaces to buy tokens. You need only to register on such a platform, but first make sure it’s a reliable marketplace to avoid getting scammed.
Reliable NTF Marketplaces
- OpenSea: This is an ETH-based marketplace that requires a Web3 wallet, like MetaMask, to use. You may exchange NFTs for cryptocurrencies and vice versa on this platform.
- SuperRare: SR is a marketplace for only original NFT products. The platform operates on the Ethereum network, so only ETH can gain access.
- Nifty Gateway: This platform offers primary and secondary marketplaces for content creators and resellers, respectively. Nifty Gateway is also ETH-orientated.
- NBA Top Shot: As the name suggests, this marketplace deals solely in verified NBA collectibles. They serve as an improved version of traditional basketball cards.
Add Funds to Your Account
Funding your NFT marketplace account is typically done through ETH. Therefore, you may easily add funds if you have an ETH wallet. If you don’t, you’ll have to open one to start.
Make Your Purchase
Buy your NFT after funding your account. The marketplaces above offer simple interfaces you can easily maneuver.
The unique nature of NFTs distinguishes them from cryptocurrencies. Their primary function is to store culture and art, but you may buy to resell on specific marketplaces. Non-fungible tokens are profitable according to market demand; therefore, mastering how to buy NFT may be an excellent income source.
In addition, if you want to automate your trading and improve your results, try the Obolon9 system.