NFTs, the latest addition to the blockchain community has taken over the DeFi market by storm. The net trading volume of NFTs skyrocketed and reached $2.5 billion in the first half of 2021.
NFTs made headlines on March 2021 when American digital artist Mike Winkelmann, popularly known as the Beeple sold one of his digital artworks for $69 million. The news created a splash and many started debating whether to invest in NFTs or not.
Here in this article, we are going to talk about NFTs, how to create NFTs and the different marketplaces where you can sell NFTs.
What are NFTs?
NFTs are non-fungible collectible tokens that hold a value and creates ownership for a particular asset. They are very similar to cryptocurrencies but unlike other fungible assets like fiat money or bitcoins, their value cannot be interchanged. So, how are they different from fungible assets?
Fungible assets like dollar or bitcoin can be exchanged with each other but their value remains the same. For example, the value of one dollar will always be equal to the value of another dollar and the same for bitcoins and other cryptocurrencies.
NFTs are non-fungible assets and it is impossible to exchange their value. NFTs are unique because they allow digital signatures that give proof of ownership to the asset holder. They are extremely useful for traditional artworks like paintings and musicians where their value cannot be duplicated.
NFTs can be stored digitally and can be used virtually to hold many types of digital assets like:
Tokenized real estate
How to create NFTs?
Creating NFTs is pretty straightforward but first, you need to decide on the blockchain where you want to create your NFT. Ethereum by far is the most popular choice for creating NFTs. There are other popular blockchains like Tron, Polkadot, Tezos, Binance Smart Chain, Cosmos, etc.
Each blockchain has its own standardized wallets and official tokens. So, while selling an NFT, if you have to look for an exchange that is compatible with your NFT wallet and the blockchain network.
Where to Store NFTs?
You need wallets to store your NFTs. NFTs are digital assets and can be stored in cryptocurrency wallets. Crypto wallets can be hardware, software, or desktop wallets that gives ownership to your digital assets. They are a gateway to the blockchain networks and secures your funds with unique passwords and private keys.
Private keys are seed phrases that are used to lock your wallet and keep your assets safe. A wallet also generates a public key or address that is used for transactions on the blockchain network. The 12-word seed phrases are used to recover your wallet if it is lost or stolen. Apart from these private keys, there are other security features like 2FA (two-factor) authentication which maximizes the security for your funds.
MetaMask built on the Ethereum blockchain is one of the most popular wallets. You can simply download the wallet from the app store and install it on your device. After installing, create an account. It will ask for passwords and after confirmation, you have to sync your NFT wallet with your device. Other popular wallets include Trust wallet, Enjin, Kukai, Coinbase, etc.
How to Sell NFTs?
NFT marketplaces are platforms where you can buy or sell NFTs. To sell NFTs, sellers need to set up their NFT wallet and connect it to the blockchain network. After that, they need to create a collection of their products, link social websites, upload images, create a banner, and profile. After the account has been created, they need to add their NFTs with descriptions, images, videos, choose price listings, and list them for sale. Remember to pre-fund your wallet with cryptocurrencies that are compatible with the marketplace.
Top 5 NFT Marketplaces 2021
OpenSea – OpenSea auction market was launched in 2018 is one of the largest NFT platforms that run on the Ethereum blockchain network. OpenSea features more than 700 NFT products and includes big brands like CryptoKitties, Axies, etc. OpenSea supports ERC1155 and ERC721 coins and you can create and develop your smart contracts on the platform.
Rarible – It is comparatively new in the NFT market and was launched in 2020. The platform was developed by Alexei Falin and Alex Salkinov and uses its own native token RARI, an ERC20 token. Rarible releases around 75,000 RARI tokens per week. Active users of the platform can earn RARI tokens as rewards. Rarible is mainly known for selling artworks. Other products include games, music, domains, photography, etc.
SuperRare – SuperRare was launched in 2017 and is built on the Ethereum network. It is mostly known for rare art collectibles. These artworks are authentic and single-piece artworks created by well-known artists. They have a social network where owners can interact with art fans. All transactions are done in ether, the native coin of the Ethereum blockchain.
Foundation – It was founded in February 2021 and is a community-built platform for art lovers. Artists can get 10% from the resale value of their products. Artists can also host auctions for buyers. Foundation has hosted popular artists like Nadya Tolokonnikova, Zach Lieberman, Dom Hofmann, etc.
NiftyGateway – Popularly known as ‘Nifty’ was launched in 2018 and is a popular place for well-known artists and brands. Recently it came into the limelight when popular digital artist Beeple sold one of his arts for $69 million. Nifty drops occur once every 3 weeks. All Nifty funds have to be stored in NiftyGateway wallet or MetaMask wallet.
New data has shown a rapid downfall in the overall sales volume of NFTs from $178.6 million on May 9 to 48.7 million on June 15. The numbers may be alarming but experts believe that the hype about NFTs is not going to fade away soon. NFTs not only commercializes a product but creates a legal right or ownership to the products. It allows celebrities such as musicians and painters to earn royalties on subsequent sales. Furthermore, cross-border payments have opened up a global platform for artists. A lot is going on in the NFT space and we believe it has huge potential and is the future of a decentralized economy.