Have you heard the term NFT in recent holiday gathering conversations?
Why is everyone talking about this new digital asset?
As you may have guessed, the rise in NFT sales has a lot to do with it. In the first quarter of 2021, the total value of NFT sales hit $2 billion!
Before you take a risk in investing in these non-fungible tokens (NFTs) that are taking the world by storm, you need to know more about them. Keep reading to learn how to buy NFTs in this beginner’s guide.
What are NFTs?
As stated above, NFT stands for “non-fungible token” and it’s a way of proving ownership of digital goods. As a digital asset, when you own an NFT, you have a secure record of ownership of an item or collection of items.
This record is stored on select blockchain ledgers likes Ehtereum or Solan. NFTs cannot be copied or altered and are useful for tracking ownership of property that can’t be replicated such as rights to an image or piece of land.
Investing in NFTs
What is the best way to buy an NFT?
There are many different NFT platforms available and most transactions occur in a dedicated marketplace. A majority of the marketplaces use the Ethereum network to carry out their transactions.
If you don’t have Ethereum’s native token ether, you can open an account with an exchange like Binance and buy the tokens there. Additionally, you’ll need to set up a crypto wallet that is compatible with Ethereum.
A crypto wallet gives the owner a digital address in which to store cryptocurrencies. Platforms like Binance and Coindesk allow you to open a crypto wallet. Once you’ve opened the wallet, you need to send the ether you bought to the wallet’s address.
Now you’re ready to buy an NFT on any number of marketplaces. Some examples of the top ones include Rarible, SuperRare, OpenSea, and Foundation.
Register an account on whichever marketplace you choose. Connect your wallet to that marketplace. Take time to browse and choose the NFT you want and then you’ll bid for the NFT.
Once your bid goes through, you will complete the transaction and your wallet will be debited.
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Should I Buy an NFT?
Whether or not you should buy an NFT depends on whether or not you like taking a gamble as there is no guarantee that the NFT you purchase will appreciate with time.
How to Buy NFTs: The Bottom Line
NFTs have become hugely popular because investors are seeing benefits of them. Once you know how to buy NFTs, you’ll realize that you’re involved with one of the biggest things in internet commerce. Remember though that while NFTs have a lot of good points, there are also limitations.
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