How to buy and invest in NFTs? Four ways to start your non-fungible tokens journey!
An NFT(non-fungible token) is a new type of digital item based on blockchain. NFT has a variety of use cases, including gaming, art, music, ticketing, sports, insurance, documentation, identification, and many others.
The possibilities and potential of NFT are endless, and it has the potential to become an important part of the blockchain ecosystem, and the broader economy.
How can you get involved in the NFT space and get a piece of the action? The following article will introduce you to four ways to do so with examples.
1. Buy NFTs on Exchange Markets
Buying NFTs on exchange markets is one of the most common methods, and platforms such as OpenSea and Binance have become familiar NFT trading platforms in the crypto space.
OpenSea is positioned as the industry’s leading Decentralized Exchange (DEX), offering peer-to-peer (peer-to-peer) Ethereum NFT trading.
How to purchase or bid on NFTs in OpenSea?
You can browse the various NFTs offered for sale on the platform. On the front page, the NFTs are organized by categories such as digital art, and virtual worlds and collectibles for various blockchain games etc. You can also see the sales history for the NFTs and see how much others have paid for the same item.
The platform uses Wrapped ETH (WTH) for bidding as it allows the user to bid on multiple items on the same Ether pool.
To start bidding, go to your bids section of your OpenSea account and follow the below steps :
Select the item of your choice:
Firstly, select the item you desire and hit “Make an offer” to initiate a bid.
Then, enter the amount that you would be willing to pay for it.
Wrap your ETH: Once you click on “Continue”, ETH will be upgraded to WETH via WETH station.
In order to make more bids, the platform upgrades .05 WETH.
It is worth noting that you’ll need to make two transactions the first time you upgrade your ETH.
Place a bid: Once both the transactions are confirmed, add the offer amount, and click “Confirm Offer”. Now your Bid is posted.
Share your Email: Finally, you need to submit your email so you could get a notification once your bid is accepted.
To purchase an NFT, users have the option to enter a bid for the listed goods by using the “make offer feature”. Alternatively, some sellers have a fixed price for their items.
2. Buy NFTs through NFT Projects
Many NFT projects have launched their own native tokens, such as MANA, Decentraland’s native token. MANA is an Ether ERC-20 utility token released in 2017. MANA can be used to purchase virtual world land (i.e. Land, of which there is a supply of only 90,000) and to purchase virtual world goods and services. The MANA earning mechanism is an incentive for game developers to create and manage quality content.
A step-by-step guide to buying MANA
Step 1. Register with an exchange that lists MANA
You can see a selection of exchanges that list MANA in one or more currency pairings in the table above. Choose the right platform for your needs, and then fill in an application to register for an account.
You’ll need to provide your email address and create a password. Many exchanges will also require you to provide your personal details and proof of ID in line with Know Your Customer (KYC) requirements.
Don’t forget to also enable 2-factor authentication (if available) on your account for increased security.
Step 2. Deposit funds into your account
While things change rapidly in the crypto world, it’s not likely that there’s an exchange available to convert your USD directly for MANA. If that’s the case, you’ll first need to obtain a cryptocurrency listed in a currency pair with MANA, such as bitcoin (BTC) or Ether (ETH), and then exchange it for Decentraland’s native token.
To deposit BTC into your account, copy your exchange wallet address, and then paste it as the destination when transferring coins from your BTC wallet.
If your BTC or ETH tokens are already in your exchange account, move on to step 3. If they’re stored in a separate wallet, look for the “Deposit” link from your account dashboard and copy your wallet address. You’ll then be able to send the desired amount of BTC or ETH to that address.
Step 3. Buy MANA
Once logged into your exchange account, click on the “Markets” or “Exchange” link and search for your desired currency pairing, for example, MANA/BTC. In the “Buy” field, you can then specify the amount of MANA you want to buy or the amount of BTC you want to spend. Make sure you take a moment to review the full details of the transaction including any fees that apply and the total cost of completing your purchase.
3. Buys NFTs through Yield Farming
Yield Farming is the practice of staking or lending crypto assets to generate high returns or rewards in the form of additional cryptocurrencies, a high-yielding but risky and volatile decentralized financial (DeFi) application that has recently surged in popularity due to further innovations such as liquidity mining.
Most Yield Farming protocols now rewards liquidity providers with governance tokens that can typically be traded on centralized exchanges such as Binance and decentralized exchanges such as Uniswap. There are a number of NFT projects that combine with liquidity mining, such as Aavegotchi.
On Aavegotchi, users can acquire little ghost images by staking atoken (native tokens on Aavegotchi), each of which is an NFT token. What makes Aavegotchi special is that the collateral behind the little ghosts, atoken, is an interest-bearing token, and as it accumulates over time, the value of the collateral grows over time.
How to Buy Aave ($AAVE)
Step 1: Open an online account.
The first step to buying an account begins with opening an account with a broker that supports Aave. A cryptocurrency broker provides you with a trading platform that allows you to buy and sell cryptocurrencies for a commission or fee that goes to the broker.
Step 2: Buy a wallet
After deciding where you want to buy a token and open your account, you can open a wallet where you can safely store your tokens. A cryptocurrency wallet provides you with a private set of keys to store your tokens on your exchange, which limits your liability if your account is hacked. There are 2 types of cryptocurrency wallets (hardware and software), each of which has its own advantages and disadvantages.
As an ERC-20 token, you have several options for storing your Aave, like SecuX V20 (Best Hardware Wallet) and MyEtherWallet (Best Software Wallet).
Step 3: Make your purchase
Once your wallet is set up and you have opened and fully funded your brokerage account, you can place an order to buy AAVE. Ordering to buy crypto involves a few steps.
Step 1: Choose your order type.
The order type you choose will determine when your order is filled and how much you pay for each coin. You can browse some of the most common order types here.
Step 2: Decide how much AAVE you want to buy.
Cryptocurrency prices are constantly changing. Take a look at the current market rate of Aave before deciding how many tokens you want to buy.
Step 3: Place your order.
Depending on the type of order you use, you may need to specify a maximum price you want to pay per token and the number of tokens you want to buy.
Step 4: Wait for your broker to complete your order.
After you submit your order, your broker will fill it according to your instructions. When the order is completed, you will see your tokens in your brokerage wallet. If your broker is unable to complete your order, you can cancel it at the end of the trading day or leave it open indefinitely depending on the broker.
In addition to the aforementioned NFT game project Aavegotchi, NFT art is also a major use case that has gained much momentum. The uniqueness, indivisibility, verifiable authenticity and ownership of NFT have made NFT art collectibles popular among the crowd. Representative NFT art trading platforms amount to many, such as SuperRare.
SuperRare is introducing two types of auctions: Scheduled Auctions and Reserve Auctions, each detailed below.
Scheduled Auctions
When an auction is scheduled, a countdown timer appears on the artwork indicating when bidding will start.
At the start of the auction, a countdown timer is started, indicating the time remaining.
Bidding is available at amounts equal to or higher than the starting bid price. Bids placed during an auction cannot be cancelled. If a bidder is outbid, their bid is returned.
If a bid is placed within the last 15 minutes of an auction, the auction time is extended by 15 minutes from the time of the bid.
The high bid at the end of the auction wins the auction.
Scheduled Auctions Step by Step– Buyer’s perspective:
Get notified that an artist or collector you follow has scheduled an upcoming auction. Offers are not available on the work until the auction starts.
At the time of the auction start, the work is available for bidding. If the seller has set a starting bid price, your bid must meet or exceed it.
If you get outbid, your funds will be returned immediately and you can place a higher bid.
If a bid is placed within the last 15 minutes of an auction, the auction time is extended to 15 minutes after the time of the bid.
At the end of the auction, it closes automatically. You and the seller are notified that it needs to be settled.
If the seller doesn’t do it first, you can settle the auction via your notifications page, and the money and artwork change hands.
Reserve Auctions
When setting up a Reserve Auction, the seller of an artwork chooses a public reserve price which, when met, kicks off the timed auction
Reserve auctions don’t have a scheduled start time. Instead, the artwork has an indicator that a reserve price is set, and is available for bidding starting at the reserve price.
The first bid must be at least the reserve price. When the reserve price is met by the first bid, the auction is triggered and the timer starts a 24-hour countdown to the end of the auction.
Bids placed during an active timed auction cannot be cancelled. If a bidder is outbid, their bid is returned.
If a bid is placed within the last 15 minutes of an auction, the auction time is extended by 15 minutes.
The high bid at the end of the auction wins the auction.
Reserve Auctions Step by Step– Buyer’s perspective:
Get notified that an artist or collector you follow has set up a reserve auction on an artwork with X reserve price
The artwork has an indicator that it has a reserve auction set with X reserve price.
You cannot bid beneath the reserve price.
If you place a bid that meets or exceeds the seller’s reserve price, the auction is triggered starting a 24-hour countdown to the end of the auction.
If a bid is placed within the last 15 minutes of an auction, the auction time is extended to 15 minutes after the time of the bid.
At the end of the auction, it closes automatically and notifies you and seller that it needs to be settled
If the seller doesn’t do it first, you can settle the auction via your notifications page, and the money and artwork change hands.
All in all, here provides with you four major ways to buy NFT! Have a try and wish you desirable experiences!
