3d concept NFTs can be used to commodify digital creations, such as digital art, video game items, and music files.

A Beginner’s Guide to NFTs

Cryptocurrency, virtual assets, and blockchain technology as a whole seem like a mysterious subject to unravel, especially for the uninitiated who are yet to experience the intriguing ups and downs of the crypto market. Adding to that mystery are non-fungible tokens, popularly called NFTs. 

These lots have been around since 2014, but they’ve only started getting true recognition this year. Thanks to the sales surge and impressive amount of investment they are attracting.

Via: Reuters

If you’re wondering why investors are scrambling to join the NFT train, the image above perfectly explains it

NFT trading volume hit $10.7 billion in the third quarter of 2021, that’s an increase of over 800% from the previous quarter. 

What are NFTs?

Via: iStock Photos

NFTs are unique digital tokens on a blockchain that represents real-life objects; music, image, video, in-game items, drawing, gif, tweets, signatures, and just about any other tangible or intangible item you wish to tokenize.

They cannot be imitated or swapped because no two NFT assets are the same. 

How do they work?

Via: iStock Photos

Believe it or not, you do not have to be an artistic genius to partake in the NFT space. All you need is a digital wallet and the resolve to conduct proper research by reading articles and other content that will guide you.

An excellent way to start is by completing this article.

Creating or “minting” NFTs is not as hard as you might think. You don’t even have to break a sweat. The whole process is about creating a digital artwork and a smart contract on a blockchain that confirms that you truly own the asset.

NFTs are housed on the ethereum blockchain, although it is possible to host them on other blockchain platforms.

Sometimes, the creator or buyer embeds extra data (like a signature) into an NFT to make it unique and exclusive.

The transfer of ownership between the creator and the buyer as well all other transactions involving an NFT is recorded on the blockchain.

Are NFTs profitable?

This year has shown us that the NFT industry is a goldmine waiting to be tapped. Twitter co-founder Jack Dorsey sold his first ever tweet on the microblogging platform as an NFT for over $2.9 million. Yes, you read right. Someone paid almost $3 million quid for a tweet.

Via: The New York Times

Well, that’s nothing compared to Mike Winkelmann’s achievement. The digital artist who is nicknamed Beeple sold a JPG file, “The First 5000 days,” for $69.3 million.

I believe these examples are good enough to clear any misgiving. NFTs are one hundred percent profitable if you have a good understanding of the industry.

How do I participate?

Via: iStock Photos

You want to start by creating a digital wallet that supports digital currencies and NFTs. You will also need to set up an account with a reputable NFT marketplace like Opensea, Rarible, or Foundation. The next step is to purchase any cryptocurrency (most likely Ether) that’s accepted by your NFT provider from a crypto exchange.

Finally, you will need to move the cryptocurrency from the exchange to your wallet. Viola! You can start minting, buying, and selling NFTs.

NEXT: FATF set to release Anti-Money Laundering policy next week

About Godwin

Godwin is a multi-faceted writer. He covers the latest and most significant news in the crypto industry for Newsbsc. Aside from his work here, he writes exceptional SEO optimized web contents for other websites in different sectors.

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