NFTs, or non-fungible tokens, are having a big moment as the world watches those riding the early NFT wave make millions overnight. These digital artifacts are at the center of an exciting mash-up between pop culture, crypto enthusiasts, decentralization advocates, collectors and tech aficionados.
Ready to dive into the world of NFTs but don’t know where to start? Use Benzinga’s list of the Best NFT Platforms to learn the ropes and find the right NFT marketplace for you.
What is a NFT?
NFT stands for non-fungible token, which a unique digital asset managed on blockchain that you are able to buy, sell, trade and own.
When a commodity is non-fungible, it means it’s not mutually interchangeable. As an example, if you buy a Beeple Crap or 3LAU NFT, you can resell it for cryptocurrency, but it’s not directly interchangeable with other NFTs.
Any NFTs non-fungible nature is what gives it its appeal. It’s a unique piece of data. And because NFTs exist on a blockchain, they allow for peer-to-peer (P2P) transactions. This is a major upside for creators looking to sell their digital wares directly to their fans and cut out the middleman.
Blockchain also enables NFTs a few other benefits. Here are the basics:
- An NFT is a digital file with a unique identity.
- An NFT is built on a blockchain using specific token standards, most commonly Ethereum ERC-721.
- Creating an NFT requires uploading your digital file to an NFT marketplace.
- Blockchain allows you to verify the authenticity of an NFT, which is a large part of its appeal.
Once you get the basic gist of NFTs, it’s easy to make your own NFT. Common NFTs include digital art, music NFTs, in-game tokens, trading cards like basketball cards or Pokemon cards and more.
Best NFT Exchange
Much like a cryptocurrency exchange, an NFT exchange allows you to buy, sell and trade NFTs. It also makes it possible to upload and tokenize your digital soon-to-be-asset as a blockchain-based token.
The world of NFTs is growing rapidly, with marketplaces popping up left and right to meet the demand for these digital artifacts. But several have emerged ahead of the crowded pool of contenders to prove themselves as the best NFT exchange in their category.
Best for Variety: OpenSea
The largest NFT marketplace currently in operation, OpenSea is one of the most known names in NFTs. If you want the ability to browse all types of NFTs, from digital art to rare collectibles, this is the exchange for you. It’s easy to sign up for and even easier to upload your NFT to auction, making it a popular choice for makers as well as buyers.
Like many exchanges, OpenSea relies on Ethereum, and you need to purchase ETH, its native coin, to fund your bids, trades and cover any fees you may incur. This is usually cents on the dollar at most.
OpenSea requires an active wallet and recommends MetaMask as the best option. This is an easy-to-use browser extension.
Best for Exclusive Drops: Nifty Gateway
Have alerts set for anytime your favorite brand or artist drops new merch? Nifty Gateway, powered by crypto-exchange Gemini, is the marketplace for you.
Dubbed Nifties, the digital items on Nifty Gateway speak to the hypebeast inside of all of us. With a stated mission of reaching 1 billion people collecting Nifties, Nifty Gateway is sure to remain a key player in NFTs.
Nifty Gateway knows how to appeal to anybody who obsesses over exclusive drops from iconic brands like Supreme. Check out its drop schedule or sign up for the exclusive drop list to keep an eye on releases from super-sought after creators like EDM musician Deadmau5 and artist Marius Sperlich.
Best Social Aspect: SuperRare
SuperRare is a digital artwork auction house meets social network. SuperRare believes that collecting is, at its core, a socially-driven pastime.
And that approach makes sense. NFTs are speculative in nature, an people like you and I ultimately decide the value. Without others vying for the same pieces or knowing why other collectors go wild for a piece, it’s difficult to assign value.
If you’re a creator, SuperRare is currently still in its early adopter phase, with only a few choice artists being selected to be added to the marketplace. But don’t sleep on SuperRare. Stay poised for the full launch in 2022.
Best for Sports Fans: NBA Top Shot
The collectible basketball card market has been hot again for the past few years, and NBA Top Shot is the future of sports memorabilia and the digital answer to sports collectibles.
Allowing its users to own the best moments from NBA history, NBA Top Shot is where sports lovers can bid on and collect Top Shop Moments in 3 categories: Rookies, Vets and Rising Star Players. NBA Top Shot members will see a wide range of edition sizes.
At the top tier Genesis, only 1 edition of a collectible is available. Memorabilia in the Common (lowest) tier have 10,000+ editions available.
The NBA Top Shot Marketplace is easy to navigate. Search by categories like Latest Drop Moments or Moments from your favorite teams. You can search by tier, set or player to find the exact types of collectible moments you’re looking for.
How to Set Up an NFT Exchange Account
Setting up an NFT exchange account will vary by platform, but here’s a general step-by-step guide to follow.
Step 1: Open up a wallet
If you’re already buying and exchanging crypto, you may already have a wallet. But if you don’t, you’ll need to open one to use NFT exchanges.
A wallet is where you keep your digital money as well as your identifiers and credentials. It’s essentially the portal that lets you access and interact with blockchain.
Step 2: Open and fund account on your chosen NFT exchange
This is the easy part. Visit your chosen marketplace and follow directions to open up an account. Most require little legwork. If you have your wallet set up, you’ll be able to get to trading NFTs fairly quickly once your account is funded.
The great majority of NFTs are Ethereum-based, so you’ll need ETH tokens to purchase.
Still need a cryptocurrency exchange account? Try out Coinbase or eToro.
Step 3: Bid on Your NFT
Once you have your wallet set up and enough ETH in your NFT exchange account to buy, you’re ready to go!
If you’ve ever bid on something on eBay or StockX, you know how this works. You may choose to bid on the primary offering of an NFT or wait until you see what the market value is on the secondary market.
Don’t Miss the NFT Boat
Remember the early days of Bitcoin? Then you probably know not to knock something new until you try it, especially new trends in currency or assets.
And if you play it smart and only invest what you can afford to lose, you have nothing to worry about. There’s a marketplace for seemingly every kind of digital artifact with more sure to come.
Don’t miss out. Get in as an early adopter by signing up for one of the exchanges on our list.
Frequently Asked Questions
Q: What is a famous example of a non-fungible token?
A: Colored Coins are widely considered the first NFTs. These were small amounts of Bitcoin that were used to identify and represent digital assets.
But the first breakout NFT in its current iteration could be listed as Force of Will. This was a NFT trading card game that ended up ranking 4th in sales in North America, beat out only by super heavy hitters like Magic: The Gathering and Yu-Gi-Oh.
Q: What is the most expensive NFT ever sold?
A: To date, the most expensive NFT ever sold was “The First 5,000 Days” by Beeple. Beeple committed to posting new digital work every single day beginning sometime in 2007, and this NFT represented the first 5,000 of this impressive feat.
This NFT sold for close to $70 million in a Christie’s auction, making it the most expensive sale to date and leaving Beeple in third place of the most valuable artists globally.
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