How to Invest in NFT: Step-be-Step Guide
Purchasing NFT is more like creating an art collection than investing in cryptocurrency. Sure, the technical aspects put NFT into a category with crypto, but to succeed with Non-Fungible Tokens, you should approach them differently — and recognize your emotions.
Any digital file can be an NFT, but they are mostly images. Videos, animated pics, and audio files are significantly less represented on the market. An NFT is unique in a way that its origins, owner, and price changes are written into a blockchain. You can screenshot an NFT image, but the file will be different. The ownership of Non-Fungible Tokens is proven in the distributed ledger.
In this article, we explain how to invest in NFT technically and give advice on the emotional approach that helps you earn money — but sure, profit is the main reason why people buy NFT.
Technically, the process of investing in NFT is as easy as pie, but you need to make conscious decisions at each step to hope for revenue.
Step 1: Get Your Crypto Wallet Ready
You obviously cannot pay for NFT with traditional cash. Cryptocurrency is needed here, so you should create a crypto wallet if you don’t already have one.
We at DMarket recommend using the MetaMask for this. Not only do you get a wallet, but the service also gives you easy access to various blockchain applications (and not only those).
For example, you can use MetaMask to sign up for a DMarket account and start your game items trading business. By the way, here is an article on how to start investing in CS:GO.
The decision at this step is pretty obvious. What type of blockchain do you prefer to have your NFT on? The most popular answer is “Ethereum blockchain” as most NFT are Ethereum-based.
Still, this step is closely connected to the next one. Some NFT platforms have their requirements/recommendations on crypto wallets. So, you might want not to rush with the actions before getting all the information.
Step 2: Choose an NFT Platform
There are a few pretty popular places to purchase NFT. They are marketplaces, where artists and traders sell their tokens.
OpenSea is the first platform you should visit and explore if you want to invest in NFT. It is currently the biggest one, and you’ll find lots of various tokens here.
Crypto.com is a pretty big service with options to trade NFT, exchange cryptocurrency, etc.
Rarible is a community-driven marketplace, and the choice of NFT is also impressive.
Solanart — this marketplace uses the Phantom blockchain, so if you decide to use it, you will need the Phantom crypto wallet.
This list of NFT platforms is certainly not complete, but a good starting point if you are interested in how to invest in NFT technology.
Step 3. Select an NFT to Purchase
In fact, it’s the most difficult step. And it’s a moment when emotions come to the fore.
How do art collectors choose what painting to buy? Sure, the artist’s reputation and some business connections play their role. But most people have their own vision of what art is and which masterpieces will gain value in time. A kind of intuition is needed to feel what painting or sculpture will grow in price substantially.
So, those who want to know how to invest in NFT successfully should select tokens for purchasing on the basis of these two factors:
Everything that surrounds the artist, the project, and the art. What’s the artist’s reputation? Are they successful? Are they a celebrity of some sort? Do they have other art projects? Famous people naturally attract more attention to everything they do; their name itself is a brand to sell NFT. Consistency of artistic work is also important. Uniqueness of the art-style is also worth considering. Do your research before you decide to buy NFT!
Your subtle intuitive understanding of art in general. What do you think about this image with no connection to your NFT investment? Like human beings, we enjoy some things and dislike others. In a way, the art we favor reflects our personality. Your NFT collection is filled with your personal understanding of beauty. It is essential to listen to your intuitive feelings, as it’s a recipe for successful art collectors.
Take your time to explore your marketplace and conduct your research. Patience is needed to find your perfect digital art and then invest in NFT profitably.
Step 4. Exchange Cryptocurrency and Buy NFT
The money aspect is very important as you totally don’t want to pay more than necessary. This is a step where you should put emotions aside and make a very pragmatic decision.
However much you like an art piece, don’t rush into purchasing it. Step aside and consider prices all over the marketplace. Are you ready to pay this money for this specific NFT?
Use crypto exchangers such as Binance, Coinbase, BitMEX, or OKX. Buy Ethereum and then complete the deal on your NFT marketplace.
Congratulations! You are an NFT investor now.
NFT Worth Investing In
The most challenging step in our guide on how to invest in NFT technology is third: the selection of tokens to buy. The trick is that no one can give ultimate advice — NFT investments are one of the riskiest, and you should be aware of this.
Always check out the background of every token you purchase. The artist’s personality, previous owners, and media attention affect the price significantly.
Choose a niche for your investment in the long-term. NFT in gaming is one of the most popular. Limited-edition art collections attract people’s interest. Celebrity creations are popular and also worth investing in. Always look for something beautiful (for you*) and unique. It’s the most profitable and least risky investment.
The Best NFT to Invest In
Let’s have some examples of profitable NFT purchases:
Quantium — it’s the first ever NFT, and you can’t argue with this uniqueness.
Everydays: the First 5000 Days — the artist did a tremendous amount of work to create this art piece. It is creatively unique.
Bored Ape Yacht Club — these NFT give you access to a closed club, a specific community. It’s a unique feature.
CryptoKitties — they are adorable, and their owners get a breeding game to play. We have unique tokens made for the mass audience.
Again, these examples emphasize uniqueness and creative value. Combine that — it’s how to invest in NFT and choose the best tokens. You might want to remind yourself about what NFT is to delve into the topic and figure out what you want to invest in.
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