Non-fungible tokens or NFTs are digital assets that are assigned a digital signature, this makes them unique. The asset can be replicated, however, the record of ownership of that asset is stored on a public ledger safely. Here everyone will be able to see the certificate of ownership.
Many artists, musicians, as well as celebrities are capitalizing on this trend by making their own NFTs, then selling them on marketplaces. From music to memes to sports memorabilia, everything can be found. If you are looking forward to buying them, you only need a cryptocurrency wallet. OR. You need an account with an exchange like WazirX or Binance.
How can you buy an NFT?
Most NFT transactions are done in a dedicated marketplace. A quick step-by-step guide on buying these digital assets from marketplaces.
A large no of marketplaces currently uses the Ethereum network to power the transactions. So, you will have to have Ethereum’s native token Ether to be able to buy an NFT. If you do not, you can open an account with an exchange like WazirX or Binance, then purchase the tokens from there.
You have to set up a crypto wallet compatible with Ethereum; a crypto wallet is a digital address where the users can store cryptocurrencies. Users can open wallets on platforms like Metamask, Binance, or even Coindesk. You have to visit the site of your preferred platform, then register to open a wallet with them. After you open the wallet, send the ether you bought from the exchange to the wallet’s address.
Select the marketplace you wish to purchase the NFT from. There are numerous marketplaces for NFTs, for example, a few of the top NFT marketplaces are OpenSea, Rarible, SuperRare, as well as Foundation.
- First, you have to register an account at the marketplace you prefer. Different marketplaces provide different registration processes.
- Then, you have to connect your wallet to the marketplace. Most marketplaces provide a simple ‘Connect wallet’ option.
- Browse the marketplace, then select an NFT as per your liking. Nearly all marketplaces have an auction system set up for purchasing NFTs; you will have to bid for the NFT you wish to buy.
- After your bid is successful the transaction will be completed. The bid amount will be debited from the wallet. Note to remember, You may also have to pay a transaction fee to the marketplace, however, the fee also depends on the marketplace.
Should you be investing in an NFT?
NFT market is a speculative market driven by scarcity accompanied by FOMO (fear of missing out). There is no guarantee the NFT you purchase will appreciate with time. However, if you want to support an independent artist, whilst fueling your acceptable appetite for losses, these can be a fine collectible for your digital library.
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