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EXPLAINED: NFTs for Dummies

by , 19 March 2021
EXPLAINED: NFTs for Dummies
NFTs

You might have heard this word in the media lately.

And if you haven't…

I promise you, you will VERY soon.

In fact, I believe it'll soon be a part of your everyday vocabulary just like the word ‘Bitcoin'.

And it could even potentially be your next stream of income.

Some trend starter South Africans are already banking over $4,000 a month with this revolutionary alternative investment.

So in this article, I want to introduce you to the very basics of NFTs, what they are, how they work and how to profit.

Let's start with…

________________________________________
 
It's a YES or NO question…
 
Do you want to start making money outside of your job?
 
If you answered YES, then you’ll want to take a look at this.
 
  
No! I’m making enough money…
 
________________________________________
 
What is an NFT (Non-Fungible-Token)?
 
An NFT is a digital asset that can be created bought, exchanged and sold on the blockchain from a variety of unique items.
 
 
In short, an NFT is the new way to invest in art in the digital world.
 
In fact, you can create or trade just about any digital asset (item created or stored on the computer) including:
 
Sports or gaming cards
Photos, images or GIFs (animated videos)
Music and art
And even Virtual real estate and clothing.
 
Before we get into how to create, buy and sell NFTs, we first need to understand how they are built.
 
If you don’t want to read the technical side, you can skip this part:
 
How NFTs are built
 
First, NFTs are distributed and stored on the blockchain via smart contracts.
 
Each item (piece of digital art) is structured in a way that they cannot be copied, removed, divided or destroyed.
  
And this is thanks to two Ethereum tokens standards.
 
ERC-721 AND ERC-1155.
 
ERC OR Ethereum Request for Comments is just the infrastructure that is used to build the NFT software and have it compatible and approved by Ethereum.
 
This allows you to invest in NFTs, on any reputable blockchain platform.
 
Let’s leave the technicalities to the programmers and developers.
 
And let’s get into how you can trade NFTs.
 
5 Steps to create, invest and profit from NFTs
 
Step #1: Own Ethereum
 
First, you'll need to buy Ethereum where you can shop for and create as many NFTs as you like.
 
Note: Ethereum is the most popular currency to trade and create NFTs at the moment. I wouldn’t trust any other crypto-currency.
 
 
Step #2: Sign up with an NFT marketplace
 
Next, you'll need to head over to a reputable NFT platform to start your digital art trading journey. 
 
The best platforms out there at the moment are:
 
SuperRare
Rarible
OpenSea
Nifty Gateway (partially owned by Cameron and Tyler Winklevoss).
 
You’ll simply follow the steps and connect your Ethereum account with your NFT platform – so you can trade.
 
Step #3: Create or trade the NFTs
 
Once you have an account and are logged in, you can get started. 
 
Either you can go through the market place and see what NFTs are currently being auctioned.
 
For example: Here’s SuperRare’s platform showing which  digital art items are being bid on right now…

 
Once you’re in the digital gallery, you’ll be able to choose an item you like, raise the bid and wait to see if you're the highest bidder.
 
It's just like in any auction, really. Except it’s online.
 
Or if you’d like to create your own NFT, there is a 1-page process you can follow where you’ll:
 
Choose a digital asset to create or upload
 
This is where you’ll upload an item you have on your computer or create an item from scratch
 
Write a title of your NFT
 
This is where you’ll choose a name of your digital item e.g. Garfield 1978 Comic Strip
 
In fact, my dad has even started to sell photos of 100s of years old comics, that have been passed down over generations.
 
Choose a description
 
This is where you can mention how you came about the NFT, why it’s unique, rare and other interesting information you believe this is valuable to attract potential investors.
 
Choose the price of your NFT
 
Either you can set a starting bid price or you can let the market choose the bid price of your item.
At this stage you can also choose what percentage of royalties, you’d like to receive whenever someone else sells your NFT. This can range from 10%, 20% and so on…
 
NOTE: There is a small fee that you’ll have to pay to create the NFT. This is to verify, upload and create confirmation.
 
A digital NFT can be anything from images, cards, photography, videos, virtual real estate, music, collectibles and even characters.
 
And so, the more complex it is, the bigger the fee you’ll have to pay to add it on the blockchain.
 
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COVID has created the perfect market for savvy stock pickers. In fact, some of my readers have already been rewarded with an insane 519% gain from DRD Gold, 330% from Jubilee and tallying up our closed portfolio at Jan 2021, we’ve generated average gains of 64% across a portfolio of 13 stocks.
 
We’re on the hunt for more. Care to join us…?
 
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Step #4: Wait and profit
 
You're done. Now you can let the market take over where they’ll hopefully keep raising the bid price and you can  eventually sell for a decent profit.
 
I trust this article helped introduce you to create a new stream of income through digital art. 
 
If you have any questions about Non-Fungible-Tokens, click here and ask away. 
  
Trade well, 
 
Timon Rossolimos,
Analyst, Red Hot Storm Trader  


EXPLAINED: NFTs for Dummies
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