Are you intrigued by the potential of non-fungible tokens, but still not quite sure what they are and how they are used? If you want a guide to NFTs, check out our blog that gives you an introduction to everything you need to know.
For further detail on how non-fungible tokens work, and how to buy, sell and create them, we have pulled together even more information to ensure you get the best possible experience of dealing with NFTs.
How do Non-Fungible Tokens Work?
To put it as simply as possible, an NFT is a digital asset that represents a real-world object. Each NFT is a unique collectible property that can be bought and sold online, usually with cryptocurrency.
Much of the recent publicity around NFTs has been generated by the huge sums paid for pieces of art, such as the $69million paid for Beeple’s purely digital artwork Everydays: The First 5000 Days.
However, NFTs can also relate to GIFS, videos and sports highlights, virtual avatars and video game skins, designer sneakers and pieces of music.
Even a tweet can have value in the NFT marketplace. Jack Dorsey, the founder of Twitter, sold his first tweet as an NFT for more than $2.9million in March 2021.
NFTs exist on a blockchain, most often Ethereum, and can be viewed as Ethereum tokens. At the heart of the appeal of NFTs is the fact that by purchasing one you have exclusive ownership rights.
Each NFT has a unique data signature that means it cannot be simply exchanged for another. Tokens that can be exchanged are fungible – hence the description “non-fungible” tokens, which points to the quality that gives NFTs their value.
This gives the content creator a great deal of power. With its unique code, each NFT has a scarcity value that comes from its built-in authentication. For in-demand artists, that makes them incredibly valuable. The creator can include specific information and even include a signature in an NFT’s metadata.
What are Non-Fungible Tokens Used For?
NFTs are effectively blockchain technology tokens that empower artists and content creators. By creating a unique piece of collectible digital property, they can earn significant sums of money from an NFT marketplace that is becoming increasingly competitive.
One of the most compelling examples of such a sale was the one held by William Shatner, the actor who played Captain Kirk in the original Star Trek series. In 2020, Shatner released a collection of NFTs of personal memorabilia from his 60-year career and sold 125,000 units in just nine minutes. He said: “I’m astonished at how quickly it all happened.”
The huge appeal of the expanding NFT marketplace helps to explain why such astonishment is becoming much rarer. In a world increasingly familiar with the operations of the metaverse, more and more people are becoming comfortable with the concept of non-fungible tokens, their value and the way you can trade in them.
Another way of engaging with NFTs is through play-to-earn games, where you can monetize your playing time by buying and selling in-game NFTs.
All NFTs are administered by smart contracts, which include the unique identification information, verify the ownership and control any transactions.
How to Buy Non-Fungible Tokens
So, how do you go about taking the plunge into the NFT marketplace? The first step is to open a digital wallet. This is where you will store your NFTs and the digital currency required to purchase them.
Check out what currencies are accepted by the NFT provider of your choice. Some popular options are Trust Wallet – which is particularly good for beginners – MetaMask, and MyEtherWallet.
Coinbase is a platform that allows you to buy crypto using a credit card. You can then move your currency to your chosen wallet. Bear in mind that most exchanges will charge you a percentage of your purchase price when you buy NFTs.
When it comes to choosing an NFT marketplace, your selection will depend on the type of NFTs you want to buy. For instance, if you want to buy artwork using Ethereum tokens, you may head to SuperRare. OpenSea claims to be the largest NFT marketplace in the Metaverse, with a trading volume of more than $4billion. For fans of basketball collectibles, NBA Top Shot might be a good place to start.
How to create and sell Non-Fungible Tokens
If you have a piece of rare digital art, or maybe a sports video collectible, you may want to create an NFT and monetise your asset. The steps you need to take to create and sell it are fairly straightforward.
Go to your chosen NFT marketplace and look for the “Create” button. This is where you create your collectible and upload an image of it. Set a price, and the royalties you want if it is resold. Connect your digital wallet, hit “Start” and you’re good to go.
How ZirconTech can help with your Non-Fungible Tokens journey
Only you can decide whether or not you wish to enter the NFT marketplace and begin buying, selling and creating NFTs.
However, if you require expert assistance, look no further than ZirconTech. We have extensive experience of handling blockchain technology tokens and can help you to navigate the NFT marketplace in the best way for you.