First things first, what is an NFT?
NFT or, as they’re commonly known, Non-Fungible Tokens, are one-of-a-kind tokens used for trading. Still, confused? Let me break it down for you.
Fungible means something that may be exchanged or traded. Non-fungible, in literal terms, means something that may not be interchangeable. For example, a car being exchanged for another car is fungible. Whereas, a car being exchanged for a monster Smart TV is non-fungible; making both of them unique in their ways. Stored on what we know as a digital ledger, which verifies a token’s authenticity, making sure it’s not replaceable.
Where to find them?
As mentioned earlier, Blockchain is the digital ledger that comprises world-famous cryptocurrencies like Bitcoin and Ethereum, for example. Blockchain allows you to get access to what we know as a token, which is transferred to your digital wallet. The topmost NFTs are traded on the Ethereum blockchain, making it one of the most famous cryptocurrencies in the world.
What can you find on the market and what sells?
Anything digital can be sold on the market. From movies to music to art to books to AI; you name it, they have it. However, nowadays, the center of attention has become NFT Art, which is why everyone is after it. Perhaps, it’s become more about the collection of fine arts by individuals. For example; Canadian musician Grimes, who is also the partner of billionaire Elon Musk, sold a 50 seconds video to a customer for US$ 390,000. As of March 2021, Grimes has sold over US$ 6 million worth of digital artwork. Well-renowned digital artist, Beeple, is also known to have sold a video for a staggering US$ 6.6 million.
If it sells, does everyone get ownership?
Good question, but, it doesn’t work that way. The buyer of the artwork remains the sole owner of the original art. However, digital copies of the same artwork may be circulated. To make it sound simpler; you create something and sell it to ONE person only. Further prints of your artwork may be sold but the first and only buyer remains the only person to have an original, alongside you.
Benefits for the Artist
Artists have to be the biggest beneficiaries in this whole scenario. Artists, that would probably struggle in the real world, have had a great time selling their workpieces. Through NFTs, artists make a fortune for something which wouldn’t be worth much in the real world. Another huge benefit is that artists can have terms set on their contract such as; getting a certain percentage every time the artwork is further sold on to someone.
Benefits to the Buyer (read. Collectors)
Buying a certain art piece lets you get your hands on something which you can call yours and yours only. In simpler words, you get the bragging rights for a certain artwork. Some people, that like to call themselves collectors, have high hopes. They believe that someday, they’ll be able to make a fortune off of these when the prices of digital artwork skyrocket.
Entering the market: Create an e-wallet
In most, if not all, cases you’ll need some sort of cryptocurrency. You choose your form of payment, usually Ether by Ethereum, to start buying your tokens. These tokens need to be picked wisely, hence, making it a task requiring some effort. Ether can be bought through various apps that sell cryptocurrencies. Binance and Coinbase are two of the famous ones.
Now, how do I buy NFTs with?
Opensea, for example, is one of many platforms where you can buy digital content. Ethereum charges its customers a “gas fee”. According to Ethereum, they are asked to be made to compensate for the computing energy required to validate and process your transactions on the blockchain. Once you’ve paid the gas and transaction fee, you automatically become the owner. From this point on you can choose to sell or keep your piece. MakersPlace, OpenSea, SuperRare, Nifty Gateway, Decentraland, and Rarible are some of the most famous marketplaces for digital content. Here, you may find all sorts of NFTs, especially digital artwork. Binance is Launching its NFT marketplace in June
For music lovers, YellowHeart is the platform. Musicians release their album artwork on there along with concert tickets. This, according to experts, ensures authenticity thanks to blockchain.
Assuming you want to sell
You want to sell your artwork so you put it for sale and it becomes an NFT. Rarible is known to be a trusted marketplace for digital content. You create an account, connect your platform of purchase to your platform of selling, and voila; you’re ready to sell.
Cons of NFTs
NFT minting and trading are believed to add to climate change greatly. This sounds unbelievable, perhaps because everything is done online. However, that’s not the case. NFTs are believed to use numerous amounts of energy along with the transactions. Perhaps, the biggest flaw of it all is anonymity. It’s hard to keep track of whether the artwork is authentic. Hence, the industry is the perfect place for exploitation and theft.
To the layman, this may sound unreal. I mean, c’mon, try telling a person you could make millions off of your artwork; how many would buy that? Non-Fungible Tokens and Cryptocurrency are the future and those who choose to not get involved may be left behind. NFTs, as risky as they are, is actually a decent source of income for artists that would not make it big elsewhere. To conclude it, one should definitely give it a shot and see if this is their thing to do.