Selling digital art on the internet is now possible, thanks to NFT. This form of virtual currency is currently exploding and generating millions of dollars in the international market. Find out more about this new cryptocurrency trend in this article.
The development of digital technology has generated many financial opportunities in the world. The best known of them is cryptocurrency, which allows the accumulation and transaction of “virtual currency”. The latter is recorded in a virtual ledger called “blockchain”. But besides virtual currency, did you know that you can also buy and sell virtual art? Thanks to the blockchain, many “web artists” put images, GIFs, or videos for sale on the internet through a process called NFT. And as absurd as it may sound, it pays a lot! But what is NFT? How does it really work? And how to make money with it? In this article, we’ll dive into this revolutionary and controversial investment trend.
What is an NFT?
Before we understand how it works, let’s start by knowing what it is. The word NFT is an abbreviation for “Non-Fungible Token”. In simpler terms, it is a cryptographic and digital asset that is registered in the blockchain. It is therefore in the same category as cryptocurrencies. The only difference is that it is not replaceable. So how is that possible?
In order for us to fully understand this definition, let’s illustrate it with an example. Imagine that you have 10 coins of 1 dollar each in your pocket. You are tired of hearing them ring, so you exchange them with a 10 dollar bill. Cryptocurrency works exactly like that. You can exchange Bitcoin or Ethereum with others of the same value.
The NFT is the opposite of this process. Having an NFT is like having the original Mona Lisa painting in your hands. Each chip has a unique property and cannot be exchanged for another NFT. It is also inimitable, which means that no one can duplicate an existing NFT. So if you have a non-fungible token, you can be sure that you will be the only one in the world to have it.
How does it work?
A few months ago, the GIF of a cat dragging a rainbow “Nyan Cat” sold for over $500,000. A simple Photoshop collage of 5,000 photos sold for over $6 million. What they have in common: Both of these files are accompanied by an NFT.
“How can you buy simple images and GIFs at such a price, yet they are available on the internet?” you may say. Indeed, nothing prevents you from accessing these files on the web, right-click on them and go to “save as”. But this will not make you their owner for all that. With the NFT, the creators of these digital files can put a financial value on them. They will become unique “digital works of art” in the world.
“But this image is already on my computer desk “. True. But it’s not the original. And since it’s not the original, you can’t use it for profit. It’s like if you took a picture of the Mona Lisa, printed it out, and hung it on your bedroom wall. Even if the picture is exactly the same, it does not make you the owner of the painting. You will not be able to resell it or make a profit from it.
Instead, with NFT, you can turn any digital file into money. The NFT acts as a digital signature on a file. It can then authenticate it as the original work with a certificate of authenticity. It is presented as a sequence of numbers, digits, and characters unique to a file. Anyone who wants to own it can buy it in Ethereum. In exchange, he will receive the digital certificate of the file in question, certified and registered in the blockchain.
The 10 Main Use Cases for NFTs
⦁ Guarantee the authenticity of the products
⦁ To ensure the traceability of artistic works
⦁ Simplify real estate transactions
⦁ Making the supply chain more transparent
⦁ Secure medical records
⦁ Diplomas and titles
⦁ Intellectual property and patents
⦁ Ticketing
⦁ Voting
⦁ The video game industry
How to make money with NFTs?
After all, making money with NFTs is not a pipe dream but a real possibility. We will tell you everything you need to know on how to invest wisely.
NFT Games
NFT video games are also taking shape as blockchain allows you to change the game from “pay to win” to “play to win”. NFT game development is the way to go in order for games to attract a larger audience and increase revenue opportunities through high-demand rewards. These games have features that allow you to buy, sell, trade, or exchange your collectibles. Although no games have gained high popularity so far, the potential is huge.
Since games are known to be a great deal for virtual items, video games with NFT sellable in-game items are likely to be big winners. Notably, NFT video game developers are also ambitious creators of NFT, which could drive further development of its technology.
In-game NFT is the most advanced compared to other forms of NFTs such as art, fashion, and trading collectible cards. This is because there are complex, fully interactive but constantly changing over time and must be upgraded or updated as the player’s character changes.
Passive Income from NFTs
Most NFTs on the market derive their value from their art or rarity. On the other hand, some NFTs can provide their holders with passive income in the form of dividends. The best example is CyberKongz Genesis NFTs. Owning one of the first thousand Genesis Kongz gives users 10 BANA$ tokens per day for the next 10 years. These tokens can then be used to interact with CyberKongz channels, or sold on the markets for profit.
Trade NFTs
You will see in this article that there are several ways to get rich. Here we present to you in detail the most common, and ultimately the easiest way, to trade NFT. You may be familiar with trading Bitcoin. It’s all about buying with your digital wallet a certain amount of this currency online, and then selling it on the day you feel your profits are sufficient. You can do the same thing with NFTs.
The starting point is to go to marketplaces, the first ones being OpenSea and Rarible. You come and buy NFTs as you would shop on Amazon. It’s almost as simple except that, due to the crypto world, you pay in Ethereum and not in Euros or dollars. You are now the owner of NFT. These pretty pictures (but it can be something else like video) are sometimes worth 1 hundredth of Ethereum, others several, knowing that in mid-November 1 ETH is worth more than 3 500 euros. And this is where NFT becomes an exciting world and especially with which to make money.
Create NFTs
Is NFT really art? In any case, it is a world that is also speculative. But what if you were the creator? Web platforms such as OpenSea, Rarible, or Mintible make it easy enough once you’ve created your work on a drawing program, for example. Will your creation be sold among all the others? It’s up to you to make it known to give it a market value that can increase exponentially. The stratospheric growth curves of some cryptocurrencies are also found in NFTs.
Final Thoughts
These are the main ways to make money with NFTs. It would be possible to talk about investing in start-ups managing NFTs or doing staking, i.e. a collection of NFTs paid by other NFTs. But the creation, passive income sources, trading, and crypto-gaming will already be very good opportunities to get rich. There are also many celebrities and wealthy people joining into this trend with the likes of Snoop Dogg and Gary Vaynerchuk. Gary V. has even gone 1 step further and created his own NFT collection, “VeeFriends“. This space will definitely be one to watch over the next decade as it continues to advance and grow into something with more real-world use cases.