This week I saw an app come in, a woman from my investment club: “W0w! I just bought my first NFT and she is a beauty! So many learnings I can share. From installing Metamask, failing with 2 different crypto wallets to get money transferred so I could use Metamask. Then I downloaded Coinbase Wallet as an alternative, and used Gemini to buy ETH using dollars, I hooked it up to Opensea to create an account and FINALLY bought a witch from https://www.cryptocoven.xyz/. I started this process last Thursday, and finally tonight was able to buy it. It is so cumbersome. But I’m proud!” She just briefly bought her first NFT!

I read this and addressed myself, “Okay, this is a reminder. You were going to dive into the world of crypto and you mentioned several times that you find NFTs so interesting, get to it!” NFTs, here we go, are you reading along? What exactly is an NFT, and how can you buy it?

What is an NFT again?

An NFT stands for non fungible token. This is a token, a value, a possession, which is not replaceable and which is unique.

NFTs have often been in the news lately as digital owners of an “all-first tweet,” “a unique sports clip” (which are sold for staggering sums of money) but the link quickly made to NFTs is art. Sometimes a digital ownership of existing art, but special crypto art works are also created.

Capabilities of NFTs

But there is – I think – more value and more possibilities with NFTs. I think it’s important to understand that NFTs are products that are irreplaceable. Who are unique. So that makes them interesting and desirable. Now there is hype around art, but I can also imagine our passports are all NFTs. Or a ticket to a concert. Or buying a house. So how is this different from a regular concert ticket? Or buying an “ordinary” work of art? When buying an NFTs, you use crypto to trade, and the transaction takes place on the blockchain network. And
as you have been able to read in this article
, the blockchain network makes transactions transparent and non-fraudulent. It is recorded in the network that you bought a work of art, so no one can put a heel on you.

Juicy example

Do you know Doja Cat? That’s a musician. She has a large fan base that is a fan of what she makes: music, art, clothing…. She created a collection of 26,000 items that you can buy on a special site. Each item is represented by an NFT token. She gave each NFT different rights and benefits. When you buy an NFT from Doja Cat, you not only own the tiem, but Doja Cat uses NFTs to provide experiences to its audience.

Depending on what you bought, Doja Cat’s NFTs gave you a right to certain “experiences. For example:

• The $2,500 NFT gives you VIP access to her upcoming tour.
• The $5 NFT gives you access to the discord (online social media space) where you get exclusive access to the Doja group and Doja jumping into the channel herself.

Difference from a regular ticket?

Can’t you also get this if you buy a regular ticket? Yes, but using NFTs eliminates Doja Cat’s hassles with a ticket agency, with tickets being illegally copied, with fees she normally pays to a ticket agency. By doing this through NFTs, it is faster, more transparent and with less between persons.

What I can also imagine myself, is that as a musician, you can release your own music, and build an NFT so that every time someone resells the album, you get a percentage on that as well.

How do you buy NFTs?

As you could see from my investment friend’s post, buying an NFT was not a very easy process. I haven’t bought an NFT myself yet, so I’m going to share with you what I know so far.

Buying with cryptos

NFTs you buy with crypto coins, so you must first convert your Euros into the crypto with which to buy the NFT. You do this on an exchange. Which crypto you need depends on the NFT, but you can buy most of them in Ethereum. Ethereum is the largest smart contract platform and development platform for blockchain projects. Hence, the platforms where you can purchase NFTs often have Ethereum as a means of payment.

Bitvavo, Binance or Kraken are exchanges where you can convert your money into cryptos.

Wallet

In addition to cryptocurrency, you need a wallet to store it in. A wallet is a digital wallet. But a wallet for cryptocurrency often has some more features. Thus, you can also store NFTs in it. You need a wallet because after your purchase, the NFT has to be sent somewhere.

Metamask is an option, as is the lady of the app. This one is suitable for Ethereum. You can also opt for a hardware wallet. This is the safest solution because although a good online wallet is reasonably secure, you can never completely rule out a cyber attack or hack – the danger of crypto currencies!

Offer

Many NFTs are offered on Opensea. This is a kind of Etsy for NFTs. But Binance NFT or Enjin (more focused on gaming) is another place to buy NFTs.

Ways of buying NFTs

If you thought it couldn’t get any more complicated in terms of buying NFTs: oh yes it could!

Because apart from converting your money into cryptos and creating a wallet (this sounds very simple but I find it complicated, so many choices, so many different terms and places. I will also dive into this for you), you also have different ways you can buy NFTs.

Simple variant

The simplest variant can be compared to buying a book from bol.com. You see an NFT, you pay it in the crypto in which it can be bought, and the NFT is transferred into your wallet.

An auction

Next, you can buy an NFT at auction. Here you can bid on an NFT. An auction house, but digitally. Are you the high bidder? Then this beauty is yours! But you guessed it, NFTs are hot and sought after, so prices can skyrocket. But you can also get lucky and buy a diamond in the rough.

Drop

Finally, you can buy NFTs during a so-called drop. This is when a maker of NFTs releases a collection all at once. See the above example at Doja Cat, I don’t know if it is but that may have been a drop. The idea is that with this you can get there “very early” and buy NFTs before they become really popular.

Are there any objections?

Yes, absolutely. Well for me. It is mega new and there is a lot of hype surrounding NFTs. For thousands of dollars (which are then converted into Eth or other crypto) pictures of bananas and pixel monkeys go away. Just shoot me in the foot. Also, there is quite a speculation component to it at the moment. Because what happens is that trading is done with NFTs. People hope to buy the right picture to then sell for a lot of money. And that is, well, pure speculation. Unless you have an eye for digital pixel art 😉 Besides, it’s a pyramid game:
more and more people flow into the world of NFTs
, and the more people want something, the higher the price.

Too risky…

I believe in the application of NFTs – it has more applications than just digital art trading – and think it’s a tremendously cool development myself. But I would never do this with a lot of money. I am far too defensive an investor for big bets in the world of crypto. Have you ever bought an NFT?