Artworks, memes, tweets and image collages auctioned for millions of dollars: for about a year now, digital artworks whose authenticity is guaranteed by an NFT, a cryptographic certificate registered on blockchain, have become the phenomenon of the moment, both on the web and in the real world. In essence, an NFT tool is a line of code embedded in a single electronic object whose purpose is to guarantee its ownership.
These digital objects, for example a work of art, a video or a collectible item, are generally developed on the Ethereum blockchain and its sublayers, for example the Polygon framework.
At the moment, that NFTs are revolutionizing the art world. In fact, this year there have been some amazing sales: just think of the artist Beeple who sold one of his NFT creations to an auction house for a whopping $69.3 million or of Twitter co-founder Jack Dorsey, who sold his first tweet for $2.9 million. Below, you can learn more about this topic by reading our guide on how to invest in NFTs.
Why Invest in NFT: Benefits and Risks
Unlike an ordinary cryptocurrency, which is interchangeable, an NFT is not fungible as it is unique and unrepeatable. To give a concrete example, one Bitcoin is interchangeable with another Bitcoin, a 20 euro bill with another coin of equal value, and so on. This is not feasible with unique items such as a piece of art, land, or a home.
Regarding the risks of investing in NFTs, remember that their market is based on the cryptocurrency market, very volatile for prices and speculative for returns. In the last year, NFT purchases and sales have grown dramatically, so much so that there are fears of a possible bubble, which some experts speculate could burst at any moment.
However, there is no doubt that these new instruments represent the future and, despite the risks associated with the investment, it is not difficult to foresee their prominent use in the coming years. With regard to the advantages of investing in NFTs, we can highlight the following strengths:
- They allow the online sale of artistic works and dematerialized objects making it more difficult to counterfeit them.
- They help artists and content creators to retain full copyright. This means they can continue to generate revenue by charging royalties to be received each time one of their creations is resold.
- They provide security through blockchains for tracking, verifying and certifying content, stimulating its dissemination along with smart contracts.
How to invest in NFTs
NFTs are new blockchain-related digital assets that are bought through cryptocurrencies, specifically the Ether (ETH) electronic currency. They are non-fungible tokens that can take different forms, for example of music pieces or elements for online game characters, such as kittens from Cryptokitties. In addition, NFTs can even exist in the form of blockchain domain names, pieces of virtual universes from the metaverse, Tweets, electronic artwork (crypto art), source code, meme content, and GIF images.
Investment Guide: How to Start
The creation and buying and selling of NFTs takes place on NFT marketplaces, either at fixed prices or at auction. Among these NFT marketplaces we find both specialized markets and generalist markets that are more or less selective, depending on the case. Here are some of the most well-known NFT marketplaces on the Web.
- OpenSea: is the largest NFT exchange platform in the world and the main consumer of gas fees on Ethereum. OpenSea allows you to sell and buy a wide variety of NFTs, particularly digital art.
- Binance: one of the world’s largest exchanges has recently launched its own NFT program dedicated to artistic tokens but also sports and gaming related playing cards.
- Sorare: is specialized in football NFTs. La Liga will collaborate with this platform to offer digital cards of its players in the form of NFT.
- SuperRare: is one of the most popular marketplaces used to sell digital art in NFT. It differs from its competitors in its belief that collecting is a social glue.
- Rarible: has a token (Rare) that allows the most active creators and collectors on the platform to vote and participate in its management.
- MakersPlace: is an online auction house specializing in Crypto Art.
- Nifty Gateway: this is a selective place dedicated to online electronic art auctions for non-fungible art tokens.
That said, the first step to investing in NFT is to create an accredited cryptocurrency e-wallet. After that, you can choose the ideal NFT platform for your goals. To this you will go and connect your digital wallet of virtual coins, making sure that you have enough of them to proceed with offers and payments.
Moreover, you can earn cryptocurrency coins expendable in NFT through your actions in your favorite online games thanks to the advent of play-to-earn functionality.
Best NFTs Linked to Crypto-Gaming
In the crypto gaming sphere, you can track down the best NFTs of the moment in the following platforms:
- Decentraland, a video game entertainment infrastructure that stands out for the LAND tokens you can use to purchase NFTs.
- Axie Infinity, a virtual pet universe that allows you to earn money by playing and selling land and items in exchange for crypto money.
- Gods Unchained, a game specially designed to spread the elements of NFT by playing cards.
The Best NFTs Linked to Crypto-Art
In the area of crypto arts, the best NFTs of the moment are available on:
- Art Blocks, an e-store that generates crypto art pieces in the form of images or interactive experiences at the request of customers.
- Hashmask, a digital art gallery collection with thousands of original portraits.
- CryptoPunk, an exclusive collection of rare characters such as thugs and zombies.
Investing in NFT: is it worth it? Forecasts for the Future
The risk of bubble is around the corner, but considering all the advantages we have previously listed, investing in NFT would seem to be convenient even in the future perspective thanks to the continuous technological evolution. However, to invest in NFT you need to have a passion for rare or trendy works, or know well how to take advantage of them. Moreover, you need to deal with the costs and fees associated with NFT platforms to create accounts, buy tokens, convert one cryptocurrency to another, and so on.