NFT Ultimate Guide

NFT Ultimate Guide

What are NFTs?

Understanding by example

Where can this technology be applied to?

Buying NFTs

1. Buy Ethereum

2. Get a crypto wallet

3. Send Ethereum to your wallet

4. Sync your wallet with OpenSea

5. Buy an NFT on Opensea

Extras

Resources for you when navigating The NFT space

Popular NFT Projects

What are NFTs?

NFTs, or non-fungible tokens, are blockchain-based tokens that prove the ownership and provenance of digital items such as images, video files, and even physical assets.

An NFT is a Non-Fungible token, But what does that mean? let's dive deep

A non-fungible token is basically a token that contains metadata, and this token can be transferred from one wallet to another just like you would transfer any other crypto asset. The main feature is that the creator, current owner, and the whole history of the NFT are visible on the blockchain, which makes it a great way to prove originality from the creator, trading history of the NFT, and ownership of the current owner all through the blockchain.

The websites like Opensea or NFT wallets will display the NFT using the metadata of the token as in the following diagram:

Understanding by example

Let take the example of the infamous Mona Lisa, if there are 2 museums claiming that they have the original Mona Lisa to solve this issue we need to check for the authenticity of the art and the history of how the painting was transferred from the artist to the museum, there will be several investigations, from references on literary works to various testings to figure out — but we never know for sure whether it's switched in history by a clever art thief, which was never found out. This is how the non-blockchain world works.

How would a similar scenario have worked out in NFTs?

You will be able to verify the creator of the NFT through the blockchain clearly.

Also be able to verify the transaction history of the NFT through the blockchain

Where can this technology be applied to?

Even though currently NFTs are mostly about art/collectibles there are many other serious use cases for NFTs

an NFT can be used as a

  • Membership card/NFT
  • For land deeds
  • Event Tickets
  • In-game Items
  • Identification Cards/NFTs

and the list continues… anywhere you need to verify the authenticity of an item or the transaction history, NFTs can be used.

Buying NFTs

Non-fungible tokens can be purchased on a huge number of NFT marketplaces including OpenSea, Rarible, and SuperRare, but we will be focusing on the most popular/most used platform by a great margin that is OpenSea

In Brief

  • Buy Ethereum on a cryptocurrency exchange like Coinbase or Kraken.
  • Get a crypto wallet like Metamask.
  • Send Ethereum from your cryptocurrency exchange to your wallet.
  • Sync your wallet with an NFT marketplace like Opensea.
  • Buy an NFT on that marketplace with Ethereum stored on your wallet.

1. Buy Ethereum

You need Ethereum to enter the world of NFTs because it’s the native currency of the eponymous blockchain network, and the majority of NFTs are built on Ethereum.

To get Ethereum, you’ll need to head to a cryptocurrency exchange, such as Coinbase or Binance.

2. Get a crypto wallet

There are many Ethereum wallets out there. But by far the most popular is MetaMask. MetaMask is a browser plugin, and it works best with Google Chrome or Brave. Once it’s installed, it lets you store Ethereum and Ethereum-based tokens. for the demo, we will be using Metamask.

3. Send Ethereum to your wallet

Now that you have Ethereum (step 1) and MetaMask (step 2), it’s time to fund your wallet with Ethereum. Go to your exchange’s “send” or “withdraw” page that lets you move funds to a crypto wallet. It will ask you to enter the amount you want to send and a blockchain address, and so you will need to copy your Ethereum public address as displayed on your MetaMask.

4. Sync your wallet with OpenSea

NFTs are traded on NFT marketplaces, and OpenSea is by far the most popular when it comes to Ethereum-based NFTs.

Signing up for OpenSea takes a few clicks. At the top-right corner of the OpenSea website, you’ll see a wallet icon. Click on it, and it will show you a long list of supported crypto wallets. Choose MetaMask, if you’ve followed the earlier step and got yourself MetaMask. If you’ve opted for an alternative, select the appropriate wallet from the list; many wallets support the WalletConnect protocol for connecting to websites.

Once you choose MetaMask from that list, OpenSea will show a pop-up window that says “Connect with MetaMask.” Click next, and your profile will automatically be created. And that’s done!

5. Buy an NFT on Opensea

After you decide on which NFT to buy after browsing through the website, you will have three options on OpenSea: buy now, make an offer, and place a bid.

NFTs may be listed by their owners at a fixed price (“current price”) often denominated in Ethereum. You can buy that NFT by paying the asking price. For that, you’ll need to click “buy now” and follow the steps. Make sure to have enough Ethereum on MetaMask before proceeding!

you also can make an offer and see if the seller accepts the price you are willing to pay!

Some sellers like a bit of competition for their NFTs so they’ll put them up for auction instead of selling them at a fixed price. Your only option is to place a bid at a price that you think is fair.

Extras

If you do not want to spend money on an NFT but you want to learn the process you can test the whole process out on the Ethereum Rinkeby testnet using “fake ETH”

here is the website for OpenSea on the testnet and how to get some tesnet coins

OpenSea on Testnet — https://testnets.opensea.io/

Rinkeby Faucet — https://faucet.rinkeby.io/

Resources for you when navigating The NFT space

NFTs can be worth a lot or nothing at all, and even if it is worth something you might not be able to sell your NFT when you need to as well. checking for liquidity of an NFT project is essential if you are looking to invest/trade NFTs. you can use the following resources to make that process easier!

Opensea — NFT marketplace ranking & Activity

dune analytics — NFT tracker

Popular NFT Projects

Bored Ape Yacht Club (BAYC)

Type: Membership & PFP

Bored Ape Yacht Club is a 10,000-strong NFT collection of ape avatars

Outside of using these as digital avatars, the NFTs also serve another purpose. Each BAYC NFT holder gains lifetime membership to a secret apes-only club. One of the more famous Bored Ape owners is the NFT star Stephen Curry, who paid $180,000 for a tweed-wearing Bored Ape NFT.

So far, it seems that membership perks are exceedingly profitable. For instance, the Yuga Labs team launched a second ape series in a creative manner. Instead of a new series, they released 10,000 Mutant Ape serum vials. Each lifetime member got one free.

The serum consists of three tiers — M1, M2, and Mega Mutant. When injected into a regular Bored Ape, the serum generates a Mutant Ape Yacht Club NFT.

Moreover, another 10,000 were then released to the public, all selling out for about $10,000 each, or for about 3 ETH. As of press time, the Mutant Ape strain has reached nearly $260 million in total sales,

Sandbox Land

Type: Metaverse Land

A LAND is a digital piece of real estate in The Sandbox’s metaverse. Game designers use LAND to build digital experiences, such as games or dioramas, and also populate them with ASSETs. Each LAND is a unique, non-fungible ERC-721 token on the Ethereum blockchain. A total of 166,464 LANDs will be available.

LAND ownership will allow you to:

  • Secure desirable locations from the finite amount of LAND in The Sandbox
  • Participate in gameplay in The Sandbox
  • Host games or experiences on your LAND
  • Earn SAND by hosting gameplay or renting the LAND
  • Organize contests and events on your LAND
  • Participate in metaverse governance

These are only a few examples of a rapidly developing technology, These projects may or may not be there in the future, but what we do know is that these projects illustrate the potential of what NFTs can become.

Disclaimer: This is not financial advice or an investment suggestion. The content is provided solely for educational reasons; you should not interpret any of the information or other material as legal, tax, investment, financial, or other advice.

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Muhammad Humair Qureshi

Muhammad Humair Qureshi

In short, my interests are in research, investment, and climate change.