What Exactly Are NFTs and How To Invest in Them: Detailed Guide

February 21 03:01 2023

It doesn’t matter if you are interested in NFT technology or the beautiful artwork being released on this new medium. Instead consider it as a potentially easy way to increase your investment portfolio and provide some comfortable returns. NFTs are relatively new in the world of investments and while they can be very profitable, they should be carefully managed. This article will show you how to buy, sell, and create NFTs. 

What are NFTs?

NFTs are a vital tool for transferring physical assets and works of art to the decentralized digital world. It is a unique function of blockchain technology, which allows digital content including videos, symbols, songs, art, logos, and other visuals to be uniquely identified and stored. NFTs require the user to log in and authenticate on cryptocurrency blockchains particularly on the Ethereum network. They make it easier to buy and sell digital content online and protect owners by making sure their asset is registered as the original version . As a result, NFTs are a popular investment that has seen a rise since their creation in 2014.

NFT stands for non-fungible tokens. These are digital assets that can be easily verified on a blockchain network with tokens that are unique and traceable. These tokens are highly sought-after today as collectibles because of their uniqueness.

They are non-fungible tokens meaning that as NFTs they can’t be traded for anything. This contrasts with the fact that they are unique from other things we can exchange, such as fiat money and local currencies. NFTs are special items that can be transferred between owners using blockchain technology. This creates a digital trail that connects the seller and buyer, which helps to verify transactions. In addition, you can get a certificate of ownership for the physical counterpart which could end up being a rare collectible asset like a piece of art. With the advent of blockchain technology, NFTs have replaced certificates of ownership. NFTs use blockchain technology to create digital ownership certificates for unique physical assets. This has previously been uncommon in the cryptocurrency marketplace. 

What is the difference between NFTs and Cryptocurrencies?

NFTs can’t be compared to any other cryptocurrency because they have a fixed price that applies to all types. Their prices are often determined by the individual or collective appreciation for the art, design, or music represented by these NFTs. Although it uses the same blockchain technology as cryptocurrencies, the asset is set up differently and the cryptocurrency is used within the transaction during purchase. NFTs are not able to be directly traded or exchanged for cryptocurrency coins and they don’t trade equally since they all have a unique value. 

How to Invest in an NFT 

The investment potential of an NFT is one of the most exciting aspects of these assets. The purchase of an NFT is done within a marketplace, just as you would use Amazon or any other ecommerce site for standard products. In this case however the marketplace only sells NFT digital assets. 

The buyer will also need a digital wallet for any NFT purchase. The cryptocurrency needed to complete the transaction will be stored in the digital wallet. 

You can purchase NFTs at a fixed/fluctuating price or through a virtual auction. Virtual auctions are similar to trading stocks and cryptocurrency. As a result, NFT prices can be subject to rapid changes depending on the demand.

Finding an NFT marketplaces is relatively straightforward. NFT sales are available through many companies including: 

  • OpenSea
  • SuperRare
  • Rarible
  • Foundation 

It is recommended to buy from a trusted marketplace as fraud is still possible and scammers may try to take advantage of you.

These are four easy steps to help you get started as a beginner. 

  • Set up a Metamask wallet. The first step for anyone who wants to invest in NFT is to create a meta mask account. Download the metamask wallet application and complete login details. For beginners looking to invest in NFT tokens, the Metamask wallet is usually the best and most recommended. It protects their investments and makes it simple for them to purchase and sell NFT using the Ethereum blockchains.
  • Purchase some Ethereum (used to trade NFTs) to fill your wallet. The beginner will then need to buy Ethereum using their metamask wallet. Click “Add funds” to purchase ETH directly from MetaMask with your preferred payment method. Then go to the main screen and click the “Buy” button. MetaMask will connect you with the service provider that best suits your needs to purchase the desired amount.
  • You should also know that you can request funds for beginners by sharing your QR code with a friend or sending them a payment request.
  • Open an OpenSea account and connect your wallet. Once you have purchased Ethereum using your metamask wallet then the next step for a beginner is to open an OpenSea account and click their Metamask wallet. OpenSea is the best platform for beginners to buy and sell NFTs.
  • Purchase the desired NFT. The last step is to purchase the NFT you desire at OpenSea. Keep it in your wallet so you can sell it later if you decide to cash in the asset for currency.

Five NFT Investments That Have Been Successful

Here are five of the most bizarre and successful NFT Investments ever made: 

  • Lindsay Lohan’s electronic single Lillie was accompanied by a GIF showing her upper body covered in butterflies that flail to the beat.
  • Shawn Mendes’s digital image of the gold-encrusted vest he wore on tour.
  • Video clip showing Banksy’s artwork being burnt. The original artwork sold for $95k. The NFT of Banksy’s painting was burned and sold at $380k.
  • Charlie Bit My Finger, a viral YouTube video, was taken off YouTube and sold for $693k.
  • Jack Dorsey was the co-founder of Twitter. His first tweet, “Setting up my Twitter,” read, sold for almost $3m.


NFTs are a great way to invest if you’re interested in art and want to take advantage of the latest investment trends. NFTs have grown in popularity over the past five years and their value has increased tremendously. This results in an increased chance to generate profits while the market is still in the process of maturing.

NFTs may be trending now, but like all technologies, they will likely be replaced in the future. They are still a great investment option and a unique way to acquire digital artwork if your goal is to collect these types of assets. You will only need a digital wallet to start trading and buying NFTs making it quite easy to invest in these assets. 

Anyone can create, buy and sell NFTs. There aren’t any limitations or need for professional licensing to join in on the trend. They are an excellent way to diversify your portfolio and invest in some interesting assets that don’t have any minimum purchase amounts or other restrictions common to many investments.

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