The art world has become enamored with non-fungible tokens (NFTs), and it's making artists big money with their digital art. Mike Winkelmann, aka Beeple, sold his NFT at London's Christies auction house for $69.3 million. This added to the NFT hype. An NFT art piece is stored on a secure blockchain.
Is NFT the Same As Bitcoin?
NFT is not the same as bitcoin. Although NFTs and cryptocurrency are built with the same blockchain technology, they differ in their uniqueness.
Cryptocurrency, like bitcoin or Ethereum, can be replicated while an NFT cannot be replicated. They're digital assets. And they have encoding that gives them a digital signature that is impossible to reproduce. That is why original digital artwork can be sold exclusively. In fact, the word non-fungible means one of a kind.
It's the one-of-a-kind aspect that makes it so attractive to some people. These are digital collectibles that are investments for many.
Consider also: Is Bitcoin Still a Player?
NFT CryptoPunks
CryptoPunks are a popular NFT that have taken the world by storm. These are avatars. And to say they're a money-maker is an understatement. They go for hundreds of thousands of dollars.
Initially, CryptoPunks went anywhere from $1 to $34. But recently, one sold for $11.7 million.
CryptoPunks are only sold on LarvaLabs website.
Accessibility Attracts Artists to NFT
If you want to enter the NFT market, there are lower barriers for you. As a visual artist, composer or video producer, you can take advantage of NFTs. The global NFT marketplace is easily accessible.
The result is, you can live in North Charleston, South Carolina, as Beeple does, and have clients in Paris. It also eliminates the physical aspect of purchasing materials or shipping in the real world.
NFTs have encoding that gives them a digital signature that is impossible to reproduce.
Entering the NFT Marketplace
Once you've created your digital art or Mp3, create an account on sites such as OpenSea and Rarible. Once established as a digital artist, you can apply to sites such as Nifty Gateway and SuperRare. These sites not only have an application process, but they'll review your work.
Keep in mind you'll want to market yourself to potential buyers, so make sure you link to your website or any social media accounts.
Remember to be consistent and tenacious. Beeple worked it for 13 years before he hit the million-dollar mark. For him, fortitude paid off.
Cost of Entering NFT Marketplace
You'll need to initialize your account with OpenSea, and that will cost. The price ranges from $300 to $400. Once you pay this fee you can lazy mint your NFT.
Lazy minting is passively waiting for potential buyers to purchase your NFT. It just sits on the blockchain. But it does defer the gas fees to the buyer. You'll just need to be more patient.
When selling your NFT art, OpenSeas requires a 2.5 percent fee on the NFT sale price.
Rarible is less expensive to enter, but pulling your NFT out of it will cost. Rarible also takes a 2.5 percent commission on any NFT sale.
Consider also: 10 Things to Know About Cryptocurrency
Setting Up a Digital Wallet
You'll need to set up a digital wallet. It's on the blockchain and it's used to store cryptocurrency. Be careful to use a digital wallet that's compatible with the blockchain you're using. One example of a crypto wallet is Coinbase.
A Coinbase wallet is used to store keys and receive digital money. It also allows you to send digital money. Having a Coinbase account isn't necessary. Metamask, Math Wallet and Alpha Wallet are also available digital wallets.
Downside to NFT for Creators
The upfront sale is great. But if your NFT increases in value, you don't benefit from it if the original buyer sells at a large profit.
Also, there's the fear the demand for NFTs could be a bubble. Cryptokitties, a blockchain game, was huge in 2017, but the oversupply soon deflated the value. So, NFTs could be a gamble.