28 Mar 2022
6 min read
If you've been following the headlines on all that concerns cryptocurrency, you must have come across the term NFT (Non-Fungible Token), but you probably have questions - from, what exactly are they? How do they differ from cryptocurrencies? What's the buying and selling process? The good news is that you are at the right place at the right time. The right place because in this article, you will find out what NFTs are and have a guide on how to mint NFTs, and the right time because this is still an early time to learn about this technology.
So, back in March 2021, an artwork called every day: The First 5000 Days sold for a staggering sum of $69.3 million at Christie's Auction House; this put him into the top three most valuable artists alive. Even mind-boggling is that he will receive 10% in royalties for the image that lives entirely in the digital world every time the owner of the NFT changes. How amazing!
Well, at this point, you may be wondering: are NFTs just artworks? No, they aren't just artworks. They also include music, pictures, or even a website domain. Regardless, it's easy to see that the current craze in the NFT space has been around digital artworks.
That's it for the intro. It's time to dive right in, already, because, despite the popularity of NFTs lately, not many people know what NFTs are and how to mint an NFT.
NFT stands for Non-Fungible Token. It means it is the proof of ownership of an asset. In the context of this article, it's the proof of ownership of digital assets that live on a blockchain, usually Ethereum, but in theory, this can be an asset in general. It is also used to track changes in asset ownership over time.
Non-fungible refers to the fact that it is unique and cannot be replaced. For example, in the case of an artwork, it would not be possible to exchange one piece of artwork for another because they both have unique attributes. Essentially, it is contrary to being fungible, which can be seen as cash and coins, which it can exchange for the other. For example, one pound is always equal to another.
In the NFT space, digital assets don't only have to be artwork. It can include various items such as a word document, photographs, images, music files, audio, pdfs, 3D models, video game items, website domain names, metaverses, tweets (haha, yes, even tweets), and any other valuable asset.
Essentially, NFTs are more or less a digital certificate of authenticity that can be easily verified by anyone anywhere in the world on a blockchain. It is considered to be a revolution for the digital assets world.
Now that you know that any item can be an NFT, how do these items convert into NFTs?
This is where the term "Minting" comes into the scene. Any item can become an NFT through the process of minting.
Blockchain in itself is a publicly distributed digital ledger of transactions that are duplicated and spread across the entire network of computer systems on a peer-to-peer network. It is a system of recording information that makes it difficult or impossible to hack or cheat.
Each block contains a cryptographic hash of several transactions with their timestamps and transaction data. Each time a new transaction occurs on the blockchain, a record of that transaction is added to every participant's ledger without modifying all subsequent blocks in the chain. The decentralized database managed by all participants in the peer-to-peer network is known as Distributed Ledger Technology (DLT). This makes the blockchain secure and safe from manipulation.
When an NFT is minted, the digital item becomes a part of the blockchain. For example, if you are using the Ethereum blockchain to mint your NFT, the thing you minted becomes part of the public ledger, and once that happens, you cannot modify or change any of its properties, making it unique.
A lot of energy is used when minting an NFT. This enormous amount of energy spent is the sole reason blockchain is heavily criticized.
Gas fees on the Ethereum blockchain must be paid by NFT developers to compensate for the energy wasted. Creators must pay a network charge, often known as "gas fees," to mint an NFT. The gas charge varies depending on the network's demand and consumption. Due to the current popularity of NFTs and the fact that Ethereum is in good shape, gas fees on the blockchain can range from $100 to 140 dollars.
Essentially, minting an NFT publishes your token on the blockchain to make it purchasable. It requires access to a crypto blockchain and an NFT marketplace (Rarible, OpenSea, or Mintable).
Let's get started on how to create NFTS. It's time to find out how to make and sell them. Before we get into more detail, it's also important to know that creating an NFT will cost you money.
The truth is that while there are NFTs that have sold for hundreds to thousands and millions of dollars, those occurrences are super rare. In the whole scheme of things, NFT might not even sell, and even if it does sell, there are many fees to be incurred on the go, including the minting, network, and transaction fees involved. On the Ethereum blockchain, these fees are known as gas fees.
In all, I'd say be ready to spend around $120 (could be more or less depending on the marketplace you choose) to create your NFT, and once the NFT sells, there are more prices associated.
Creating an NFT demands that you have some amount of crypto(depending on the network) in your decentralized wallet in other for you to fund the minting of your NFT and a digital wallet to store the crypto. There are a couple of wallets that we can utilize in this process, ranging from Coinbase, Metamask, Rainbow, etc. The wallet makes it possible to create accounts and sign in to NFT marketplaces.
Here are the steps involved in minting an NFT on an NFT marketplace called OpenSea. The good news is that the same procedure applies to that marketplace, such as Rarible and Mintable.
OpenSea is the world's first and largest digital marketplace for crypto collectibles and non-fungible tokens (NFTs). One can buy, sell, and discover exclusive digital items, as described on their website.
It's a platform that is so user-friendly and is a leader among platforms where you can create your NFT for free - fast and efficiently. However, you will be required to pay a fee in ETH before you can sell your NFT.
First, visit https://opensea.io/.
Click "Create," You will navigate to a page where you will have to enter via your wallet provider, as shown below. Make sure to follow the procedure and connect your wallet.
Now that your wallet is connected, you can now mint your NFT.
The next step is to upload the digital file (any digital file, such as JPEG, MP3, GIF, or PNG). Creating a collectible can be done in two ways, either by a single image or multiple images, then give it a name. Optionally, you can also add a description for your work, price, and other metadata to your token.
At this point, you can now set up how much you will be paid in royalties if your NFT gets sold again moving forward. A standard royalty payout is considered to be in the range of 5% - 10% of the secondary sales price.
Make sure to double-check the details as you can't modify them later. Then, Click "Complete," and your first NFT has now been minted!
Now your token has been created! And for a couple of days (the marketplace will be carrying out an authenticity check). After this, you can sell it if you like. To do this, click "Sell."
At OpenSea, the sales of NFTs are usually conducted in an auction format. The sales process deserves additional articles since there are many options and settings, and you can check it in the screenshot below. You can also set the price you want and choose how you'd like to sell.
After you set everything up as you'd like, then click "Post Your Listing." The OpenSea marketplace will help calculate the necessary fees based on the network used at the payment request from your crypto wallet and listing.
Awesome! Now, you have successfully minted your very first NFT! You check out how to view your NFT in your wallet here.
NFTs are everywhere—and they are not just hype. They are essentially an investment. Whether they are digital artworks, tweets, songs, pet images, or virtually anything else, they are re-writing the rules of digital assets.
Anyone can now make their works and items more valuable and sell them on an online marketplace. But it's worth mentioning that NFTs should not be seen as a get-rich-quick scheme. While you can expect your investment to bring you a fortune, you should know that there is also a risk involved with NFTs, just as with any other investment, as there's no guarantee that anyone will be willing to purchase your work.
Turning your digital asset into a blockchain-based asset is nevertheless something promising and one that could completely reshape the way creators get paid. If you're an artist or digital creator, the NFT space is certainly worth exploring.
Blessing Krofegha is a Software Engineer Based in Lagos Nigeria, with a burning desire to contribute to making the web awesome for all, by writing and building solutions.
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