Non-fungible tokens (NFTs) have become incredibly popular in recent times. This is due to a number of reasons, such as hype, profit-seeking, and utility. This guide will explain what NFTs are, explore some of the most popular NFT marketplaces, and walk you through the steps of how to buy NFTs in Australia.
The basics of NFTs
A non-fungible token (NFT) proves ownership of a digital asset, such as a piece of artwork or an in-game item. Digital art is the area that has benefited the most from NFTs, as they allow digital artists to release their work digitally without the risk of fraudulent copies or counterfeits.
It’s true that you can save someone else’s NFT as a JPEG, however, the smallest amount of scrutiny would expose this image as inauthentic. Anyone can print a copy of the Mona Lisa. They could even frame it. But at the end of the day, it is nothing but a cheap replica, which would not be worth anything. And that is one of the main reasons that NFTs are valuable: they verify ownership of potentially valuable assets through incorruptible computer code.
Twitter recently implemented a new hexagonal-shaped profile picture feature, which only the owners of verified NFT artworks can utilise. This is a simple, visual way that users can show prove their NFT ownership, because a regular JPEG would only display as a standard circular profile picture.
Why should I buy an NFT?
There are many reasons why someone might want to own NFTs. NFTs can allow owners to:
- Own original pieces of digital artwork and support their favourite artists
- Gain access to unique in-game items, such as costumes, virtual real estate, digital collectibles or avatars
- Acquire unique collectibles, like trading cards or memorable sporting moments
- Attend exclusive experiences, such as parties or concerts
- Speculate on the NFT market and trade NFTs to try to make a big profit.
What is the easiest way to buy NFTs?
There are a couple of different ways to purchase NFTs, but the easiest way is to purchase them through a reputable NFT marketplace. These marketplaces operate in a similar fashion to other online marketplaces like eBay.
There are lots of different NFT marketplaces where you can buy and sell NFTs, such as OpenSea, Rarible, or Foundation. Depending on which one you choose, you will be able to purchase different types of art and collectibles so it’s good to do some research and figure out which is the right fit for you. And just remember, each marketplace operates a bit differently.
Most NFT marketplaces will display the most popular NFT collections, while others also give you the option to browse individual NFTs (Figure 1). An NFT collection page will provide details such as how many NFTs there are in that collection and the floor price (the cheapest NFT available in a collection). Individual NFTs will display the creator’s name and the price of the NFT.
Figure 1 – Browsing an NFT marketplace
How to buy NFTs
Step 1 – Purchase ETH
Ether (ETH) is the most widely accepted form of digital currency used on NFT marketplaces. This is primarily because most NFTs are tokens that run on the Ethereum blockchain. You can buy ETH from any big cryptocurrency exchange, such as Swyftx, and then send your crypto to external crypto wallets, such as MetaMask. We’ll outline how to set up a MetaMask wallet and send your ETH to it below.
Step 2 – Create a MetaMask wallet
MetaMask is one of the most popular external digital wallets available. It is supported by most popular web browsers such as Firefox and Google Chrome. It can also be used on both Android and iOS mobile devices as well.
In Google Chrome, navigate to the Chrome Web Store and install the MetaMask wallet extension. Now set up your new MetaMask wallet and store your seed phrase in a safe place. A seed phrase is a computer-generated password that will be displayed as a string of words. It can be used to recover your wallet and coins if you forget your password.
Did You Know?
An external wallet like MetaMask allows users to interact with almost every Ethereum-based platform. Although some exchanges may have an in-built NFT store, a MetaMask wallet allows users to purchase from any NFT markets available.
Step 3 – Transfer ETH to your MetaMask wallet
Now you will need to transfer some ETH from your exchange account to your new MetaMask wallet. Make sure you add enough ETH to cover the cost of the NFT you would like to purchase, as well as the accompanying gas fee (a transaction fee on the Ethereum network).
Read: How to Withdraw Crypto to an External Wallet for more detailed instructions.
Step 4 – Login to OpenSea using your MetaMask credentials
Your MetaMask wallet address functions as a username and password, which will allow you to interact with different platforms such as OpenSea, which is the largest NFT marketplace that lets people buy and sell digital art. Click the wallet icon in the top right corner of the website and connect your MetaMask wallet (Figure 2).
Figure 2 – Logging into OpenSea using MetaMask wallet
Once you have connected your crypto wallet to OpenSea, you will be ready to start searching for an NFT that you would like to purchase.
Step 5 – Browse the marketplace
On OpenSea, click on “Explore” to browse the most popular NFT collections on the platform. You have the option to filter by category (i.e. art, sports, trading cards, music). Alternatively, you can use the search bar to find something specific you are interested in.
Step 6 – Buy your NFT
Once you have found an NFT that you like, click on it to go to the NFT’s product page. This page will display a picture or video of the NFT and the price (Figure 3). The price will generally be displayed in ETH, with a USD equivalent beside it. If the price is right, you can click the “Buy now” button. If the price is too high, but you are still interested, you can click the “Make offer” button instead. This functionality is similar to auction sites like eBay.
Figure 3 – OpenSea NFT product page
If you click “Buy Now”, a window will pop up showing you the total price of the NFT. You will have to agree to the terms of service and review the gas fee required. Once you click “Confirm” your transaction will start processing. Once your purchase is confirmed, you can view your shiny new NFT by navigating to your profile icon and clicking on “My Collections”.
Important To Remember
NFT purchases are not always instant. It could take a few hours, or sometimes longer, to process your purchase. But don’t fret, it is in progress! Sometimes it just takes a little while to verify and process your transaction depending on the congestion of the Ethereum network.
The world of NFTs is vast and there are millions to choose from. This section will highlight just a few of the most popular NFTs, but we recommend spending some time researching the different NFTs available.
CryptoPunks NFT collection
Figure 4 – Twelve CryptoPunk NFTs
CryptoPunks is a collection of 10,000 unique, 8-bit cyberpunk-style avatars, ranging from humans, apes, zombies, and aliens. CryptoPunks can come equipped with accessories, such as pipes, hats, glasses, shades, and more. The maximum number of accessories a Punk can have is seven, but it is also possible to have none.
Bored Ape Yacht Club NFT collection
Figure 5 – Six Bored Ape Yacht Club NFTs
Inspired by CryptoPunks, Bored Ape Yacht Club also has a collection size of 10,000 NFTs. Each NFT is a cartoon ape that consists of different attributes involving facial expressions, fur colour, and accessories. Bored Ape owners are given full commercial rights to the image. The NFT also serves as an exclusive Yacht Club membership, which grants access to member-only benefits and private events.
In March 2022, a new crypto called Apecoin was distributed to the holders of Bored Ape NFTs. Apecoin is a utility and governance token that serves the Bored Ape community and other connected NFT communities.
Did You Know?
Many high-profile celebrities own Bored Ape Yacht Club NFTs. Some of these celebrities include Serena Williams, Eminem, Stephen Curry, and Jimmy Fallon.
Is buying NFTs safe?
Buying NFTs is totally safe, as long as you are purchasing them through a reputable NFT marketplace such as OpenSea. But beware of new or unknown NFT marketplaces or fake NFT giveaways on platforms like Twitter. These are breeding grounds for scammers.
That said, like most cryptocurrencies, NFTs are a highly speculative investment, and although some NFTs may drastically appreciate in value, there is no guarantee that yours will. So, always make sure to do your own research before investing in NFTs.
Investing in NFT tokens
There are multiple ways in which you can invest in NFTs. One method is to purchase an NFT directly, as we have outlined in this article. Another method is to invest in NFT platforms themselves. For instance, metaverse projects like Axie Infinity (AXS), Decentraland (MANA), and The Sandbox (SAND) are all NFT platforms. Generally speaking, when the platform performs well, the token representing that platform will perform well too. You can buy MANA, SAND, and AXS (as well as other NFT platform tokens) on Swyftx, individually or through the Gaming and NFT Bundle.
NFTs are an innovative application of blockchain technology that represents unique digital assets, such as artwork and in-game items. There is a chance that they are just another passing fad, but it is also likely that NFTs will have a large impact on many aspects of our digital lives in years to come.
This piece has explained what NFTs are, outlined how to purchase them using OpenSea, and highlighted some of the most popular NFTs in the crypto world.