How to buy an NFT
What you need to buy NFTs?
Buying an NFT is simple. You don’t need much to get started purchasing one of the famous tokens. The most important thing to consider is your choice of marketplace. The establishment of NFT marketplaces has turned into a bit of a trend of its own with the growing NFT hype. Tons of different marketplaces have sprung up. Selecting the right one can make all the differences in terms of NFT selection and security. So, first things first, to buy NFTs you need to register with your chosen marketplace.
Once you’ve registered an account, you’ll need money to pay for your NFTs. Instead of euros, dollars or other government currencies, NFT marketplaces use cryptocurrencies. The NFT product dictates which type of cryptocurrency you’ll need. Most marketplaces use the popular altcoins rather than the better-known bitcoins. Ether is one of the most widely accepted means of payment.
You’ll also need a digital wallet for your cryptocurrencies. Metamask is a good choice for this purpose as it can be easily connected to most NFT marketplaces. The wallet is available as a browser extension and as an app.
What types of NFT can you buy?
The NFT market is extremely diverse. Before purchasing NFTs, you should think about the types of tokens you’re interested in.
One large category of Non-Fungible Tokens is NFT art. As the name suggests, this category spans different digital artworks. Many of the pieces on sale have been created by digital artists who sell their art online. However, artworks by renowned artists are now also being offered as NFT. In addition to images, NFT art also includes videos.
More and more musicians are offering their music as NFTs. In contrast to NFT art, available as collector's items in small quantities, NFT music lives through the resale of tokens. The advantage for musicians is that for every NFT resale on the blockchain, musicians receive a certain payout without having to share a percentage of their profits with a music label.
NFTs have also gained a foothold within gaming. The idea of fixed, unique tokens is ideal for representing rare in-game items. In most games, these can be earned or purchased. Due to their limited number, they are very popular with players.
In addition, there are pure NFT games which pursue the Play2Earn strategy. This means that following an initial investment, users get the opportunity to earn money by playing the game and make money with their NFT. However, it’s not a particularly secure source of income because of fluctuations in cryptocurrencies.
Where to purchase NFTs securely?
Previously, wash trading of NFTs was a big problem. In wash trading, users pretend that select NFTs have increased in value. Fraudsters tend to sell an NFT to another fraudster via a self-funded wallet. By choosing an established NFT marketplace, you ensure you don’t fall victim to these scams. Be aware that regulations on NFTs are still patchy throughout the world. It’s advised you do your homework before committing to a marketplace or NFT.
Pay attention to the verification process when registering with a marketplace as this determines its security. NFT marketplaces using two-factor authentication are a good choice. It also lowers the risk of accessing marketplaces distributing NFTs that aren’t coming from the original artists. Marketplace ratings serve as useful guidance. Satisfied users are a good sign of trusted NFT transactions and the probability of dubious transactions is lower.
OpenSea is an example of a secure NFT marketplace and one of the largest platforms for buying NFTs. OpenSea guarantees user protection through various security features. Verified and approved accounts are marked by a blue tick, similar to those used on Instagram verified accounts. This way, you know which providers you can trust. OpenSea has made it particularly easy to report suspicious NFTs. The popular platform also provides two-factor authentication.
Binance is another popular, secure marketplace for selling and buying NFTs based on the Binance Smart Chain. The platform provides extensive support. Users can report suspicious NFTs. Binance also features two-factor authentication for your account.
How and where to store NFTs?
When buying NFTs for the first time, you may wonder how to store purchased tokens. After all, NFTs aren’t traditional pieces of artwork to be hung on a wall.
As with cryptocurrencies, you need a wallet to store NFTs. Established in 2012, Coinbase provides a suitable wallet. Boasting an easy-to-use and beginner-friendly user interface, the platform employs usernames for sending or receiving NFTs instead of a wallet address, making it harder for attackers to single out your NFT wallet as a potential target.
How does reselling NFT work?
Want to resell one of your NFTs following a spike in value or for other reasons? Reselling NFTs is similar to buying them. You’ll need an NFT marketplace and a crypto wallet with available funds to pay marketplace fees. Taxes may apply for selling your NFT at a profit.