Buy NFT

How To Invest In An NFT?

One of the many marvels of blockchain technology are non-fungible tokens, popularly known as NFTs that have taken the crypto space by storm, particularly in 2021. According to Fortunly, over $41 billion worth of crypto was invested in NFTs in 2021

How To Invest In An NFT?

This is an insane amount of money, and this is why many people are now interested in investing in NFTs. And this is why in this article, we’ll discuss:

  • What Are NFTs?
  • How To Buy Your First NFT?
  • How To Sell Your NFT?
  • Where To Store Your NFTs?
  • Pros And Cons Of NFTs
  • Are NFTs Worth Your Investment?

 

So let’s dive right into it.

 

What Are NFTs?

NFTs are digital assets that have a digital signature, which makes them a unique asset to hold in your crypto wallet. NFTs can be a great collection for your digital library if you want to support an independent artist and are willing to take risks. The majority of NFT transactions take place on specialized marketplaces that facilitate the trading, buying, and selling of these digital products.

 

 

How To Buy Your First NFT?

Investing in NFTs is easy. However, finding the right NFT to invest in is the real task. Before we tell you what the right NFT is, let’s learn the basic method of buying an NFT from major NFT trading platforms like OpenSea, Rarible, SuperRare, Solsea, and many others.

opensea

 

In general, here are the steps through which you can buy your first NFT:

  1. Set up a crypto wallet like Metamask and add cryptocurrency to it. The type of cryptocurrency depends on the platform you’ll use. For example, on OpenSea, you can use Ethereum, while on Solsea, Solana will come in handy.
     
  2. Once your crypto wallet is set up with cryptocurrency in it, connect your wallet to anyone NFT marketplaces like OpenSea, Rarible, and many others.
     
  3. Browse through various NFT collections like BAYC, CryptoPunks, and others. Filter the NFTs by category, type, and other attributes. Once you like an NFT, bid on it or buy directly, depending on the option, the seller of the NFT has enabled for the particular NFT.
     
  4. If you have bought the NFT directly it will show in your crypto wallet. Otherwise, the NFT you bid on will be sent to your wallet only if there is not a winning bid before the timer runs out on the NFT sale.

 

 

How To Sell Your NFT?

You have now bought your very first form of digital art, and you absolutely love your NFT. However, you wake up one day and see that the NFT collection from which you bought an NFT is trending on the NFT marketplace. So, now you decide to sell your NFT. Here’s how you can do it:

 

  1. Select your NFT and navigate the 'Sell' button. You might have to pay ‘gas fees’ to list the NFT for sale on the NFT marketplace.
     
  2. Select from two options. You can either set a fixed price or allow the buyer to buy it right away. Or you can put your NFT for an auction and it will be sold to the highest bidder.
     
  3. As soon as the NFT is sold, you will get your fee in your crypto wallet that is connected to your NFT account.

 

 

Where To Store Your NFTs?

This answer is the same for cryptocurrencies as well. You can either store your NFTs in a digital wallet, also known as a hot wallet like Coinbase wallet, Metamask, and others.

 

stolen art nf

In hot wallets, such as the Metamask, the password and seed phrase act as the wall between the hackers and your NFT. However, after the recent $1.7 million theft of NFTs on OpenSea where many digital assets were stolen through a phishing attack, NFT lovers are worried about their digital assets.

 

This is why obtaining a cold storage hardware wallet and moving your digital assets there is the best approach to store your NFT. This protects your cryptocurrencies and NFTs from hackers and keyloggers by keeping them offline. For enhanced protection, each hardware wallet comes with its own personal ID and password. Popular hardware wallets include Ledger, Trezor, and many others.

 

 

Are NFTs Worth Your Investment?

It is a fact that NFTs are a speculative investment when it comes to collecting them. The value of a work is unpredictable and will change depending on the demand for the NFT. And sadly, there is no formula for determining which collectibles will appreciate in value and which will not. Early detection of a new NFT trend, on the other hand, can pay off handsomely in the long run. For example, some NFTs that were once sold for pennies on the dollar have afterward sold for thousands of dollars.

 

In response to the claim that NFTs are a "bubble" ready to burst, bubbles are generally only discovered after the fact. However, keep in mind that digital assets may see a cooling trend at some time in the future. Consider the risks and diversify your assets by including cryptos and equities of companies that are developing blockchain technology in your NFT portfolio.

 

In summary, the development of NFTs is still in its early stages. It's a potential new front in the world of technology, but investing in any movement in its infancy comes with a lot of dangers. As you learn more about NFTs, be cautious, and remember that before you decide to purchase an NFT, always diversify your assets to reduce the chance of a single NFT derailing your wealth-building efforts.

Last Articles