How To Buy and Sell NFTs
If you’re interested in NFTs but you don’t need crypto, you might be surprised to learn that you actually do need crypto. Crypto is the currency of the NFT world — they both exist on the same blockchains.
Whether you’re looking into NFTs as an artist, a collector, an investor or a gamer, your journey will start on the same path — with you trading money for digital coins. First you’ll get a wallet, then you’ll join a crypto exchange and purchase your digital currency. Finally, you’ll join an NFT marketplace, where you’ll use your crypto to buy a sliver of data that represents your little slice of the digital ownership space.
Get a Crypto Wallet — You’ll Need It for Your NFTs
If you’ve ever considered investing in Bitcoin, you’ve probably heard that you need a digital wallet to store your cryptocurrency — but that’s misleading language.
According to Cointelegraph, wallets don’t store crypto or anything else. They provide a private key that guarantees you secure access to your investments on the blockchain.
That includes both your NFTs and the cryptocurrency you need to buy them. You’ll need only one wallet, but be sure to choose one that’s based on the same blockchain as the NFT you want to buy. A vast majority of NFTs are on the Ethereum blockchain; so, in most cases, an Ethereum crypto wallet is your best bet.
Setting one up is not hard and doesn’t require any special technical skills. The top digital wallets include:
- Math Wallet
- Coinbase Wallet
- Trust Wallet
Register With an Exchange and Buy Crypto — the Right Crypto
Now that you have a wallet ready to “store” your crypto, it’s time to convert your money into digital tokens, which you’ll trade for your first NFT a few steps later. If you’ve heard of only one cryptocurrency, it’s sure to be Bitcoin, the first and still the biggest on the market. But, in this case, it might as well be Monopoly money.
The No. 2 biggest cryptocurrency is Ethereum, which relies on the blockchain that hosts the vast majority of NFTs. That means you’ll almost certainly want to buy ETH, the native cryptocurrency of Ethereum.
In order to buy Bitcoin, ETH or any other cryptocurrency, you’ll have to register with an exchange. The biggest is Coinbase, which is publicly traded on the Nasdaq. But here, too, you have a lot of options.
When choosing an exchange, the Wall Street Journal recommends making your decision based on trading volume, fees, the selection of coins you can trade and the exchange’s liquidity levels, security features and insurance policies.
Join an NFT Marketplace
You can’t buy and sell NFTs on the same exchange where you got your crypto. To put your ETH to work, you’ll have to join a marketplace where people showcase, buy, sell and trade NFTs. Then, you’ll link your digital wallet — crypto and all — to your new NFT marketplace account.
Just as with crypto exchanges, you have a whole lot of NFT marketplaces to choose from. The biggest is OpenSea, but other top marketplaces include Nifty Gateway, Rareable, Mintable and SuperRare.
It doesn’t have to be one of those, but you should stick with a popular and established marketplace that many people use. The more active users on a marketplace, the more competitive prices will be when you buy NFTs and the more prospective buyers you’ll have if you ever decide to sell.
If you do choose to sell your NFT, you can do so on the very same marketplace where you bought it — only in this case, you’ll “receive” cryptocurrency from the buyer, who will “receive” the NFT in his or her own digital wallet.
In reality, nothing is taken from or transferred to either you or the buyer. Both the crypto coins and the NFT will remain on the blockchain where they’ve always been, but new data will be written to indicate the change in ownership.
Start Shopping — But Where and for What?
Now that you know how to buy and sell NFTs, it’s time to decide which one to purchase.
That’s where things get tricky.
Some people buy NFTs to access play-to-earn (P2E) video games. Others buy NFTs to gain membership into an NFT community. Investors buy NFTs that they think they’ll be able to sell for a profit in the future. Collectors buy NFTs for bragging rights and status, as well as for the hope of future appreciation.
According to CoinMarketCap, many NFT marketplaces focus on specific niches like art or in-game assets. Knowing what kind of NFT you’re looking for is a good way to start narrowing down your NFT shopping list.
From there, only you can say which one is worthy of your digital dollars.
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