Things To Consider Before Buying NFTs Otherwise…

Non-fungible tokens (NFTs) are part of digital assets based on the blockchain technology.

Every NFT has a unique code assigned to it that differentiates them from each other.

In this blog, we will learn the basics of NFTs, how to buy them, and miscellaneous steps to consider.

The Basics of NFT

Non-fungible means something that cannot be exchanged for anything, and fungible means something that is interchangeable, like bitcoin, because it doesn’t matter which one you own; they all share the same value.

Let’s start with an example. Imagine you have a player stats card for any particular sport and you decide to trade one of the cards from the collection with your friend, and you are transferring the ownership of that to someone else.

NFTs work in a similar fashion; they can be in the form of art, music, video, tickets, and other digital content, but what makes them different is the unique codes assigned to them.

Furthermore, NFT artists might turn art into NFT, and when someone purchases that, they are buying ownership of that particular piece.

What is Minting?

In NFT, minting refers to the process of creating a new digital asset and recording it on the blockchain as a non-fungible token.

Moreover, when a creator mints an NFT, they are turning their digital content into a unique and verifiable asset that can be bought and sold further.

Types of NFTs

NFTs can come in many different forms in the digital world, like game avatars, but most NFTs are in the form of digital artwork.

Here are the forms of NFTs, including but not limited to:

1. Digital Arts: Pictures, Illustrations, Animations, etc.
2. Collectibles: Game avatars, virtual pets, and other game assets.
3. Domain Names: Exclusivity of domain names.
4. Tickets: Access cards for movies, concerts, and other events.
5. Certificates: proof of ownership, rights, and authenticity.

These are some forms of the NFT; in the future, if we see the rise of NFTs again, we might see their different use cases as well.

How to buy NFTs?

Let’s look at the steps needed to buy NFTs:

Marketplace Selection

Select a marketplace that is reputable and famous, like OpenSea, Rarible, and some others.

Setting up a wallet

Pick a crypto wallet that is also compatible with storing NFTs, such as MetaMask.

Fund Wallet

Once the crypto wallet is set, it is used to fund it. Generally, the Ethereum-based marketplace uses Ether or other related tokens.

Browse Collection

Explore the NFTs collection in the marketplace and create a list of which one you want to buy.

Bid & Buy

There is a choice as to whether someone wants to place a bid to buy NFT at a lower price or buy it as it is at the listed price.

Confirm Transaction

Follow the commands to confirm transactions that involve the approval of transferring cryptocurrency from your wallet in exchange for NFT.

Transfer

Now, once the transaction is complete, the NFT will be transferred to your wallet.

Established Marketplace to Buy and Sell NFTs

There are numerous platforms operating online where users can buy, sell, and even create NFTs.

• • OpenSea: One of the largest and most popular platforms for the purchase and sale of NFTs, with options such as arts, collectibles, domain names, and in-game assets in the virtual world. The fees can range from anywhere between 2.5% and 10%.
  • Rarible: Another popular but community-centric platform for users to mint, buy, and sell NFTs. The platform charges a 1% transaction fee.
  • Foundation: This platform works on the invitation method and is known for the selective collection of NFTs and limited drops. The fee is usually 5%.
  • Nifty Gateway: This marketplace offers NFTs from well-known artists, brands, and even celebrities. Nifty Gateways charges 5% fees.
  • Mintable: The USP of this marketplace is that it offers easy minting and selling of NFTs without any coding. Base fees stand at 2.5%, which can go up to 5% if the user opts for gasless transactions.

Let’s take a look at precautions we can take in the process of purchasing an NFT.

Precautions to Take When Purchasing NFTs

Verification

Verify the authenticity by researching the creator and NFT you are interested in. Look for the previous work done by the creator, endorsements, or certificates.

Metadata

Check the metadata associated with the NFT to ensure that the information provided matches the content of the NFT so that there are no discrepancies.

Counterfeits

Stay cautious of NFTs that claim to be from popular artworks or individual property without authorization, and cross-check if the seller has the right to sell the NFT.

Wallet

Use 2-factor authentication, secure encrypted backups, and other security measures to protect your wallet from unauthorized access.

Expectations

We can say that currently, NFTs have gone out of trend compared to 2-3 years ago, so it’s safe to say that don’t set expectations too high in terms of return on investment.

Scope of NFTs

The scope of NFTs based on the current scenario looks like a mixed bag that can be represented from an optimistic and skeptical point of view.

Optimistic View

NFTs do have the potential to enable artists to directly sell their works in the form of NFTs and earn money on them.

They can open up new ways for creators to earn money in various industries like art, music, gaming, and entertainment.

Moreover, NFTs can provide a transparent record of ownership to ensure the authenticity of digital assets in a decentralized manner.

Skeptical View

For the majority of people, the use case of NFTs isn’t clear yet because they think they should purchase something that can be easily downloaded or saved via screenshots.

Now that a good number of NFTs have gone worthless in the recent past, this naturally creates concerns about the return on investment of NFTs.

Furthermore, the rogue elements have also been selling fake, duplicate, and low-value NFTs for a while now.

Conclusion

In this blog on how to buy NFTs, we have covered the basics of NFTs, their types, and which marketplace to purchase them from.

Moreover, the precautions required to safeguard the process of purchasing the NFTs are also included.

Furthermore, we have talked about the scope of NFTs from both a pessimistic and skeptical point of view.

Frequently Asked Questions

Q1: What is an NFT?

A1: An NFT, or non-fungible token, is a unique digital asset that represents ownership of a specific item, like artwork or music, on the blockchain.

Q2: How to buy NFTs?

A2: You can buy NFTs on online marketplaces like OpenSea, Rarible, or NBA Top Shot. These platforms allow artists and creators to sell their NFTs directly to buyers.

Q3: How do I pay for NFTs?

A3: Most NFT marketplaces accept payments in cryptocurrency, primarily Ethereum. You’ll need to set up a digital wallet and have enough cryptocurrency to complete the purchase.

Q4: Can I resell NFTs?

A4: Yes, many NFTs can be resold on the same marketplaces where you bought them. However, there may be additional transaction fees involved in the resale process.

Q5: Is buying NFTs safe?

A5: While the technology behind NFTs is secure, it’s essential to exercise caution when buying. Research the artist, verify the authenticity, and be aware of potential scams or fraudulent listings.