As the value of digital art skyrockets, everybody demands asking, “What are NFTs?”
NFT stands for non-fungible tokens. These are digital assets verified on blockchain technology, just like cryptocurrencies. But unlike cryptocurrencies exchanges, they cannot be exchanged or traded at equivalency. These assets may come in artwork, videos, music, or in-game purchases. These NFTs are becoming collectibles because of their one-of-a-kind feature.
Even though these NFTs have been present since 2014, they have become a popular investment since 2021. In the last 4-5 months, NFT talk has broken the internet. From platforms like TikTok and Twitter to CNN News, the trending topic has left millions wondering, what is it, and how can it work for me?
Non Fungible Tokens Explained
Tokens in a blockchain are commonly referred to as crypto tokens and represent digital units of value. Businesses build their token on a blockchain network to efficiently transfer value and for investors to gain access for subscription purposes.
Non-fungible tokens are cryptographic assets on a blockchain that are distinguished from one another by unique identification codes and metadata. NFT creators can use them to represent real-world objects, in-game items, or virtual baseball trading cards. And since they run on a blockchain, a decentralized digital ledger that can track documents transactions, the ownership and validity of these digital assets.
Its counterpart in the physical world would be a one-of-a-kind collectible asset, such as a physical art, for which you might have a certificate of ownership attesting to its authenticity. The NFT eliminates the requirement for certificates of ownership with its blockchain technology. However, each NFT has a digital signature that cannot be exchanged. It is through this digital signature that the NFT owner can verify ownership.
Examples of Non Fungible Tokens in Blockchain Technology
The first fungible tokens, ERC-20, were created on the Ethereum blockchain. These fungible tokens have established specifications that allow developers to create a variety of applications.
Non-fungible tokens, on the other hand, have been around since 2012, when the concept of colored coins first emerged within the Bitcoin blockchain. Users use it to identify a product, service, or person uniquely.
NFTs represent a unique, distinct, and indivisible thing, such as a photograph or intellectual property. Some examples are an academic title, artwork, game asset, music composition, movie, utility, stock shares, service or subscription access, and a variety of other non-fungible items.
A specific example of an NFT project is the Bored Ape Yacht Club, a collection of ape avatars and unique digital collectibles existing in the Ethereum blockchain. This Bored ape yacht club has been one of the most influential NFTs in blockchain technology.
NFT Digital Art Expounded
The popularity of NFT digital art has transformed the creative business. As a result, some graphic artists and designers have entered the NFT sphere.
NFT Digital Art is a digital tool artist can sign their work and ensure it is not plagiarized. They are minting Digital Asset as an NFT. You can prove ownership over such a digital piece as each NFT is distinct and traceable.
Digital assets are difficult to steal, thanks to NFT. As a result, artists and NFT creators will not be defrauded out of royalties, and collectors will not have to worry about acquiring and investing in forgeries or fakes. It’s a means for artists to add a digital signature that can’t be forged or deleted.
NFTs can be thought of as the digital version of the receipt you’d get after purchasing something substantial in a store if you’re a collector. It also attributes ownership to one person, even if many can see it.
Everything under the sun can be sold as an NFT, even tweets and memes. Jack Dorsey, CEO of Twitter, sold his first tweet as an NFT for nearly $3 million. The tweet that says, “just setting up my twttr,” was first posted by Dorsey on March 21, 2006.
Meanwhile, digital art by the artist Beeple sold as an NFT for over $60 million, making it the most expensive NFT ever sold at auction. Mike Winkelmann, known as Beeple, set out in 2007 to create a new piece of digital art every day for the rest of his life, and he hasn’t missed a single day since. “The First 5,000 Days” was compiled from the first 5,000 of these works, which he refers to as “Everydays.”
The Process of Buying NFT Digital Artwork
Buying NFT digital artwork is not rocket science. It is not only for crypto enthusiasts but for those who love art and those who have the hobby of collecting art items and digital objects.
How does one buy an NFT artwork?
- Create a cryptocurrency wallet
- First, you should start by creating a digital wallet. You will use your crypto wallet to send, receive, and store digital assets like NFTs and cryptocurrencies. To get a crypto wallet, you’ll need to buy some cryptocurrency, such as Ether, depending on the currencies accepted by your NFT provider.
- Coinbase, Kraken, eToro, and even PayPal and Robinhood now allow you to buy cryptocurrency with a credit card. After that, you’ll be able to transfer it from the exchange to your preferred wallet.
- Shop on the NFT marketplace
- Once the crypto wallet is created and funded, you can now shop on any NFT sites online, and there is a variety of NFT marketplaces that you can choose from. Some examples of these sites that sell NFTs are, Opensea, Rarible, SuperRare, Foundation, AtomicMarket, Myth Market, Bakery Swap, KnownOrigin, Enjin Market Place, Portion, and many others.
- The majority of transactions on OpenSea, the leading marketplace, are conducted in Ethereum, which necessitates using a cryptocurrency wallet. SuperRare, Nifty Gateway, and Rarible are some of OpenSea’s current competitors. Coinbase Wallet and MetaMask are two popular bitcoin wallets.
- Begin by logging into OpenSea and connecting your cryptocurrency wallet. Members of the community can view the NFTs you’ve collected in your profile. Your favorite NFTs and marketplace activities are tracked on your profile pages.
- You’re now ready to look around the marketplace and possibly make a purchase. There will be a Buy Now option on some ads, while others will allow you to make an offer to the seller. Choose the amount or cost you’re willing to pay and the expiration date when clicking Make Offer. Then the NFT is transferred into your wallet and appears under the Collected tab on your profile page once the exchange is complete.
Best Cryptocurrency Wallets
- One of the most popular bitcoin wallets is Metamask. Its browser plugin allows users to quickly access web3 sites like NFT marketplaces with only a few clicks. Metamask also makes it simple to create several addresses. It will enable you to keep your NFTs separate from your cryptocurrency or create a single address for each non fungible token you buy.
- This digital wallet offers a built-in swap mechanism if you need to swap currencies to buy an NFT. You can also set a cap on how much you spend on a gas fee, albeit there’s a chance the transaction will fail. Metamask supports alternate platforms if you need to use a different blockchain.
- Math Wallet is another alternative crypto wallet. This digital wallet’s most notable feature is that it supports over 70 distinct blockchains. It has an online, desktop, and mobile wallet that syncs between platforms and interfaces with several hardware wallets. You can also create several addresses with Math Wallet.
- Users can view NFT markets using Math Wallet’s built-in dApp browser. It also has several other services for cryptocurrency users, such as staking, exchanging, and offering its utility token.
- AlphaWallet is one of the cryptocurrency digital wallets that is open-source. While it has a few drawbacks (exclusively for mobile and Ethereum), its native support for blockchain games and NFTs sets it apart.
- Beginners will find learning relatively straightforward because of the simple user interface. The wallet has an entire area dedicated to NFTs and gaming tokens. Users can also add meta tags to their tokens to search and filter them more quickly when exploring their collection.
- Among other NFT marketplaces and blockchain games, AlphaWallet works directly with OpenSea, CryptoKitties, Dragonereum, and ChainZ Arena. It offers a built-in dApp browser, like others, to search more NFT marketplaces and direct access to DeFi apps like Compound.
- Trust Wallet is another popular mobile-only digital wallet owned by Binance. It supports a variety of blockchains, including Ethereum, but because of its affiliation with Binance, it is primarily oriented toward smart chain tokens. However, because Trust Wallet is already set up for BEP tokens, it may be the ideal solution for you if you’re interested in NFTs on the Binance smart chain.
- Trust Wallet, like other wallets, provides a dApp browser for finding NFT marketplaces, making it simple to buy NFTs from within the wallet. It also has a built-in exchange feature that allows users to quickly trade currencies to get the token they need to exchange for the NFTs they wish to buy.
- Coinbase(NASDAQ:COIN) is well-known for its bitcoin exchange. It also has a non-custodial wallet. This crypto wallet can store NFTs and other tokens. Unlike owning cryptocurrency on Coinbase’s exchange, users who store their funds in the Coinbase Wallet have complete control over their funds.
- Coinbase also has a browser extension that lets customers access their wallets across devices to buy NFTs and use other dApps. Users can also use the mobile wallet’s built-in browser to access dApps.
- One distinct advantage of Coinbase Wallet is the simplicity with which this digital wallet can transfer tokens to others by using usernames than public wallet addresses. It can add a personal touch to transactions and provide security knowing that you are transferring digital assets to the appropriate individual.
Prominent NFT Marketplaces
NFT marketplace is your gateway to participating in purchasing and selling these digital assets — from art to music to the entire virtual world. Think of NFT marketplaces as your Amazon of the digital realm.
There are dozens of NFT marketplaces, many of which cater to a specialized sector or niche. What are the best NFT marketplaces?
The most popular NFT Marketplaces are:
- In terms of NFT sales, OpenSea is the market leader. OpenSea has a wide range of digital assets available on its platform, and signing up and browsing the broad choices is completely free. It also helps artists and creators, and it provides a simple approach for creating your own NFT, also known as minting.
- The platform’s moniker is fitting because it is an open marketplace that supports over 150 different payment tokens. OpenSea is a wonderful place to start if you’re new to the NFT realm.
- Rarible, like OpenSea, is a big marketplace for all kinds of NFTs. You can buy NFTS, sell NFTS, or create all types of art, movies, collectibles, and music on the site. However, unlike OpenSea, you’ll have to purchase and sell using the marketplace’s token, Rarible (CRYPTO:RARI). Rarible is also built on an Ethereum Blockchain.
- The company has teamed up with a number of well-known businesses. Taco Bell (NYSE:YUM)has listed art on Rarible, and Adobe (NASDAQ:ADBE), a cloud software giant, recently joined with Rarible to help secure NFT artists and creators work.
- Foundation.app was created as a straightforward, no-frills method of bidding on digital art. Ethereum is being used to sell NFTs. Since its inception in early 2021, the marketplace has sold over $100 million in NFTs.
- The Foundation community invites artists to join the platform. Buyers only need an Ethereum-funded crypto wallet to get started. Foundation isn’t the ideal place to start if NFTcreators are looking for a quick and easy way to start making their own NFTs, but the NFT market offers plenty of NFT artwork that can be seen in a simple format.
- Axie Marketplace is the online store for Axie Infinity, a blockchain-based game. Axies are legendary animals that can be purchased and trained before being battled against the Axies of other players for rewards. Players can purchase new Axies and entire lands and other items as NFTs for use in the game on the Axie Marketplace.
- The Ethereum network is used to create Axie Infinity tokens (also known as Axie Shards). As a result, they’re available for purchase and sale on a number of additional NFT markets and other cryptocurrency exchanges like Coinbase Global (NASDAQ:COIN).
- Larva Labs is primarily known for the CryptoPunks NFT project, which went viral. CryptoPunks were originally given away for free in 2017, but some have since sold for millions. Larva Labs is working on a number of additional digital art projects, including Autoglyphs and other Ethereum blockchain-based app development initiatives.
- The CryptoPunks NFTs from Larva Labs are sold out, but they can be bid on and purchased on various third-party marketplaces. Nonetheless, Larva Labs’ numerous projects are worth following, particularly the Meebits, which can be purchased directly through the company’s built-in marketplace.
Pros of Buying NFT Art
There is a reason why NFT enthusiasts and digital artists are into the fad of buying and collecting NFT art. The reason is the item’s art history for illustrative purposes or a collection of digital files with artistic value. Other than that, buying NFT has its advantages for pretty obvious reasons.
One of the pros of buying NFT art is that digital art has verifiable records of ownership and authenticity. It has a digital file stored on a blockchain network with a secure digital signature. The chain of custody is marked in the digital file itself, and it is impossible to swap in a fake since changes in ownership are verified by a worldwide network and logged in public.
Buying NFT art or the NFT collection also gives you access to unique and rare art pieces from exclusive fine artists or digital artists. It is also a way of financially supporting your favorite artists. Purchasing NFT art products will provide you with basic functionality, such as the ability to share them on social media. There are also the bragging rights of owning the artwork with a blockchain entry.
Purchasing NFT art products will provide you with basic functionality, such as the ability to share them on social media. There’s also the bragging rights of owning the artwork, backed up by a blockchain entry.
With every purchase of NFT, it is also a chance for you to diversify your investment portfolio. Because the blockchain stores all transaction records, it will always be possible to show that the thing is genuine and that you possess it. Unlike physical art, where precise evidence is required and which may be difficult to sell, investing in NFT art is also practical investment advice.
Engaging in the NFT Art Community
It is important to connect with NFT enthusiasts, artists, and collectors. While NFTs are primarily used in the digital world at the moment, much of their value is derived from the human interactions they enable. Many seasoned collectors consider themselves art patrons and work closely with the artists they collect.
NFT Twitter is one of the easiest ways to connect with NFT artists and their communities. NFT artists and collectors can also communicate through Discord and other platforms like Clubhouse. The interaction and conversations will get you updated with new NFT drops. NFT will also strengthen the value of collecting because of your linkage to the artists and or the art– a time-stamping moment for the art patrons.
The Future of NFT Art
Digital art will be around for 500 years. NFT art is the future of fine art collecting. While the technology is still very recent, and the NFT space’s direction is unknown, the present momentum suggests that blockchain technology’s uses in the arts will only grow. The trend isn’t slowing down anytime soon, as famous contemporary artists such as David Salle, Tom Sachs, Petra Cortright, JR, and Roe Etheridge increasingly occupy the NFT art arena.
It’s a form of art democratization. NFTs let artists create and distribute art through online channels, bypassing traditional gatekeepers controlling what art is and who has access to it for decades. Thanks to blockchain transactions, artists can also be directly funded by their fans and have control over their careers.
In art history, NFT has also increased the diversity and representation of art. The advent of blockchain technology and NFTs and the digitization of art will transform the important actors and influences in the area, making art more representative of the world around us. Art and art spaces are becoming more democratized, allowing access to people and groups to diversify their perspective of the arts, many of whom have traditionally been underrepresented in the arts.
There is no stopping the NFT art craze. Each non fungible token representing assets created and stored in the blockchain technology has created a revolution in the arts arena. Purchasing NFT collections is not rocket science as technology has made easier access from various crypto and digital wallets to a plethora of NFT online marketplaces.
The NFT digital art has also created interactive communities between living artists, enthusiasts, and NFT creators. It has also further democratized art by bridging the inaccessible and underrepresented art gap.
These digital assets have been good investments because of their saleable feature. Art enthusiasts see NFT art as more than a collection. It has diversified financial portfolios of those who invest in them. If you like art and want to invest, this could be an excellent place to start.