Non-fungible tokens (NFTs) have become insanely popular in the digital asset space. Almost all blockchain enthusiasts either own one or plan to sell on marketplaces. While the cryptocurrency space is still unstable, the digital asset space has been able to profit from this new venture. People are buying low and selling on marketplaces at mouth-watering prices.
There at a lot of projects in this space. First, play-to-earn games leverage these assets to reward players. Additionally, projects in this space are also thriving in the space, promising early buyers a substantial floor price. You can also buy tokens at a low price and sell them higher. This is what enthusiasts call flipping. While there are numerous ways you can make money from NFTs, flipping is much easier.
What Are NFTs?
NFTs are digital assets that are not interchangeable. This makes them substantially different from cryptocurrencies. While you need cryptocurrencies to buy them, NFTs are different from cryptocurrencies. NFTs are usually artworks, music, paintings, or even drawings. Similarly, you can mint them and sell them through marketplaces. On the other hand, you can buy cryptocurrencies and sell them through exchanges or p2p. Non-fungible tokens are largely unique, meaning that most of them are one-of-a-kind. Most projects in this category have a limited supply, far lower than the average for cryptocurrencies. This uniqueness helps owners sell their tokens at mouth-watering prices.
Types Of NFTs In The Market
Tips To Pick The Best NFT Projects
Every trader in the market is focused on making profits. This includes traders in the NFT market. However, before you start to make profits, there are some steps you need to go through to pick the best NFTs. Below are some of the tips for choosing the best NFT in the crypto market;
#1 Research The Project
If you pick out the best NFTs in the market, you will have to carry out a mountain of research into the NFT project. This is because most of the NFTs in the market have no solid background. With the NFT sector gaining airwaves, some projects are in the market out of desperation by the developers. Traders who purchase these NFTs end up selling them at a meager price compared to the amount they bought them. A typical example is the first-ever tweet sold by Jack Dorsey, the ex-founder of twitter. The NFT at the time was sold for millions and is now worth about $280 in the market.
#2 Check The Community
Another integral factor that determines how profitable an NFT will be in the market is the community that it comes from. A company developing NFTs must have a large following of community members to help hype the worth of the NFT. This will make the value of the NFT profitable, and a future sale will ensure that the price does not drop below the buying price. With this, traders can make money flipping the NFT.
#3 Hype Of The Project
Owning a large following for an NFT project is never enough as the members need to ensure the project has a massive hype. As mentioned above, the promotion of the project determines the value of the NFT in the future. A typical example of such NFTs with hype is the BAYC. With the acquired hype of the community members, the value of the NFT projects has increased tremendously.
#4 Upcoming NFTs
The NFT market has a way of reducing the value of NFTs that are already in circulation. Asides from some special digital images, NFTs tend to reduce in value over a long time. However, it is important to check out new NFT projects with value. This will help traders pick out the best types of NFTs that are just coming into the market.
How to Make Money From NFTs
One of the reasons why non-fungible tokens have become so popular is because cryptocurrency can leverage them to earn money. Many people have been flipping NFTs, them earning thousands of dollars. Making money from it is simple, but you have to choose your preferred means. This relatively new industry is becoming a top choice for digital asset enthusiasts. Because it creates an avenue to earn an income through various means, users can explore and become part of the community. Even some play-to-earn games also use these tokens to reward participants. If you want to earn an income from owning non-fungible tokens, you should take note of these:
#1 Sell Or Rent Out In-Game Properties
Many blockchain-based games allow virtual landowners (in the form of NFTs) to rent out their lands to interested tenants. The landlord gets paid for renting out the property while the tenant gets perks from using the land. Some games reward tenants with tokens. With this, the tenant receives incentives for renting land. You could also sell your land. Many virtual games, like Decentraland, allow gamers to manage digital real estate, which includes allowing them to sell their property.
#2 Earn Royalties
One of the biggest perks of selling is imposing royalties on your artwork. This means that whoever buys your art will pay you whenever they sell it. This creates a long-term way to earn money from tokens. While royalties are usually small, it’s still nice to know you are still earning from your sold artwork.
#3 Sell Your NFTs
This is the easiest way to make money in this industry. You need to mint your artwork, which includes paying for gas, then you have it on the marketplace. You can include some information about the work to attract art lovers. Then, you set a price for your work, and whoever wants to buy it can see all its data. You can directly sell it at a particular price or auction it to the highest bidder.
#4 Buy Low And Sell High
Today, there are numerous projects in the asset space resulting from the new interest. After getting whitelisted, you can mint your token and wait for a buyer. Solid projects are usually expensive, so buying into a good project may assure you substantial returns.
How To Buy Non-fungible Tokens On Opensea
Owning and selling these tokens is still a profitable venture. However, before you buy an artwork on Opensea, you need to take the following steps:
Step 1 – Set Up Your Wallet
Numerous wallets can be used on Opensea, but for the sake of this guide, we will use MetaMask. If you don’t have a MetaMask account, you can create a new account. However, if you already have an account, you should install the wallet on your browser and input your seed phrase to gain access. After, you need to connect your wallet to your account by going to Opensea and “MetaMask” to log in.
Step 2 – Deposit Ether
This step is for people who don’t have Ethereum in their MetaMask. If you do, you can skip this step. An easy way to do this is by buying Eth from a centralized exchange and then transferring it to your Ethereum wallet. Some of the best exchanges for this purpose include Binance. Open your Binance account and go to “wallet.” When you get there, click on Ethereum. Then, click on “withdraw.” Withdrawing helps you move your Ethereum from your Binance wallet to your MetaMask.
Setp 3 – Buy Your NFT
You need to find your chosen non-fungible token. There are different categories of artworks on Opensea. When you find the perfect one, click on “buy now.” After clicking on it, you need to agree to the platform’s terms and checkout. Then, you would see MetaMask, where you can authorize your purchase. To buy it on Opensea, you need to pay Ethereum gas fees. This can be expensive, so you need to take note.
How To Sell NFTs On Opensea
Anyone with a computer can sell on Opensea. However, you need to have a wallet attached to your account. This requires you to create an account with Opensea-supported wallets. MetaMask is one of the wallets you can use to sell it. So, you need to install it on your browser and input your seed phrase to start using your account. Follow the following steps to sell:
Step 1 – Log Into Your Account
Opensea is not like a traditional platform where you input your password and username. To access Opensea, you need to connect your preferred wallet. When logged into your account, click on your profile at the top-right part of your screen. You can choose the token you would like to sell from your profile.
Step 2 – Set Up NFT For Sale
After picking your preferred non-fungible token, you should click on “sell.” Sell takes you to where you can choose a fixed price or an auction. Fixed prices are the exact price you want to sell your asset. Setting up an auction makes sure it is sold to the highest bidder. Auctions have an expiry date, and you can choose the starting price for your artworks. You can now list your token for sales.
Step 3 – Authorize NFT Sale
Before listing and selling on Opensea, you need to authorize the sale. This happens when you initialize your wallet for sale. You should note that you need to pay for gas. When selling on the Ethereum blockchain, you may pay as high as $100 on a busy day. That said, you can now see it on the marketplace. Opensea will notify you by mail when you sell your artwork. However, you need to confirm your email to enable this.
Conclusion
While the cryptocurrency market struggles to record new gains, enthusiasts make money from a relatively new venture called NFTs. Non-fungible tokens have been around for a while, but they recently got the needed hype in 2020. Since then, the industry has continuously recorded new volumes. Everybody wants to make money. You can do this by renting out your real estate, selling, and getting royalties on your token.
- Gaming: There are numerous blockchain-based games in the asset space. Since most of these projects leverage non-fungible tokens, you may get rewards in non-fungible tokens. You may need to participate in missions, battle other players and play in-games to get your reward. After getting your token, you can choose to use it or sell it for cryptocurrency.
- Minting: You can also choose to mint your artwork, picture, or music. Many people have minted their artworks without relying on a community. To make money from minting your artwork, you need to find a good marketplace, choose your preferred blockchain and mint it. Some marketplaces only allow you to mint on specific blockchains. For instance, Opensea allows minting on Ethereum and Polygon networks only.
