Cryptocurrency is now unmistakably one of the most lucrative industries in the world. Coming from humble beginnings, it has now completely changed the way we buy and sell and even the way we view currency, with many believing it could eventually replace cash. Since its boom in 2018/19, the price of Bitcoin, the original and most popular cryptocurrency, has sky rocketed. In 2022, 1 bitcoin is worth over $20,000. We have also seen the inception of new coins such as Ethereum and Ripple, which have firmly planted themselves as players in the market and there are now over 6000 digital coins available to buy and trade. As we have come to understand the blockchain technology behind crypto more, we have seen it be innovated in new ways, eventually birthing NFTs. Although they have been around for nearly a decade now, they did not reach their final form until recently and since the technology has got into the hands of creatives it has become supremely popular.
But what are NFTs? In short, ‘Non-Fungible Tokens’ are digital pieces of art that hold value, just like physical art. They could come in the form of an image, a gif, a video or even a piece of music and they are all completely unique. With so many people collecting them you could almost think of them as Crypto-baseball cards. A one-of-a-kind card is Non-Fungible, as you cannot trade it for an identical card, just like an NFT.
Buying NFTs can be daunting for first timers and may seem more difficult than it actually is. But it does not have to be. With this guide, we will help you understand how you can buy and trade NFTs with confidence.
Set Up A Cryptowallet
The first and most important step in buying NFTs is to set up a cryptowallet if you haven’t already. This wallet is a cryptocurrency wallet that supports the blockchain protocol NFTs are built on and also needs to support the currency you’ll buy NFTs. Ethereum is one of the most popular currencies used to purchase NFTs and has one of the most widely used wallets.
Whether you like sports, music or just appreciate the art; there is pretty much an NFT for everyone. There are hundreds of NFT marketplaces that you can browse according to your particular interests. NFTs that have collaborated with athletes however have been amongst the most popular and profitable with a single Lebron James token fetching over $200,000. Finding these is easier than you think with marketplaces. They are essentially your catalogues for NFTs. If you aren’t sure how to buy NFTs, DraftKings Marketplace makes it relatively simple. There are five drops on DraftKings’ scheduled drop day with users joining a virtual queue to purchase one. Successful buyers can view their tokens in their draftkings portfolio. Like other marketplaces, you can also sell your purchased NFTs to other DraftKings Marketplace customers. DraftKings is free to sign up for making it very easy to start browsing and building your portfolio. There plenty more marketplaces however such as OpenSea and and NFT LaunchPad. It is all about finding something that suits you.
Calculate The Scarcity/Originality
Part of what makes NFTs so profitable are just how rare some of them are. Rare NFTs from popular creators such as CryptoPunks are amongst some of the most sought after tokens, but that doesn’t mean all of their creations are good investments. For example, they have 6039 ‘Male’ CryptoPunks, making them one of the least rare in their collection and therefore moderately low in price. Aesthetics are also important not just for value but for you, the buyer. You want a token that looks good! Tools such as the NFT Value Estimator are a great help in calculating the worth of collections and tokens.
Be Smart With Your Investment
It is important to note that not every NFT is going to be profitable and as the market has become more flooded, it has become slightly harder to find original tokens from big creators. However, this should not put you off as there are plenty of tools as mentioned above to find these. Always make sure you have done your research prior to buying and are confident you are making the right decision. If you are frugal and smart with your purchases, you can curate an incredible portfolio full of amazing designs and original content to either trade or keep for yourself.
Hopefully this article has given you the confidence to enter the world of NFTs and start creating your portfolio. Above all, collecting NFTs should be enjoyable and there is no reason that your experience should not be as smooth as possible!
An author of Namaste UI, published several articles focused on blogging, business, web design & development, e-commerce, finance, health, lifestyle, marketing, social media, SEO, travel.
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