What are NFT tokens and how to make money on them?

Contemporary art in the format of non-fungible tokens brings its creators unprecedented popularity and millions of dollars. For example, recently in the United States, a 10-second video clip was sold for $ 6.6 million, and before that a meme with a pixel cat “flew away” for $ 561.

In fact, there is nothing new in the NFT topic, but over the past year this phenomenon has gained immense popularity. Today we will figure out what NFT tokens are, how to make them yourself and where you can buy them so that you can resell them at a higher price.

An NFT token is a digital original of a virtual or real object recorded in a blockchain smart contract. Literally, NFT means “non-fungible token”. He is one of a kind.

In fact, the NFT token can be compared to a painting by Leonardo da Vinci – copies of his legendary “Mona Lisa” can hang in everyone’s house, but they have no value, but the original is worth billions.

NFT cannot be duplicated, hacked or tampered with as it is an integral part of the blockchain. But it can be redeemed on special marketplaces. The most popular ones are:

https://opensea.io/

Almost any digital file can become an NFT token:

• photo;
• video;
• text;
• audio track;
• design of something;
• 2D and 3D graphics.

If the object is physical, it can be turned into digital. For example, a painting can be scanned.

The purchase of an NFT token is fraught with certain risks, since the future of the acquired asset is uncertain, and its value depends entirely on how much another buyer is willing to pay for the object. Therefore, the price of NFT is determined not by some technical indicators, but exclusively by demand.

There are two popular ways to make money on NFT. The first is to buy off-the-shelf tokens and resell them at a higher price, and the second is to create and sell your own NFTs.

Creating a non-fungible token

To launch your own blockchain asset, you do not need to have programming skills and experience with blockchain technology. Everything can be done using the popular Open Sea platform in a matter of minutes. Here’s a step-by-step guide:

1. Create an ETH wallet and add the MetaMask extension to Google Chrome.
2. Go to the official website of the Open Sea platform. On the main screen, click the Create button and log in to the system using the MetaMask wallet.
3. Create an NFT by filling in all the suggested fields: logo, name, description, etc. The more complete the information, the more chances you have to attract a buyer. Some actions will ask for MetaMask confirmation, but there will be no costs at this stage.
4. Upload the object to the platform. Please note that its size cannot exceed 100 MB.
5. When all the fields are filled in, click the Create button. Now the NFT token has been created, it can be placed on the open market and sold: for a fixed price or through an auction.

How to add value to a token

To add value to NFT, some projects are developing their own gamified platforms, where the value of an object depends not only on demand, but also on its unique properties.

As an example, we will cite one of the most sensational projects of this format – CryptoKities. The principle of its operation is quite simple:

• Each kitten of the project is a unique ERC-721 token, which is NFT.
• To “get” your own kitten, you need to buy it for cryptocurrency. Moreover, their cost is different. Simple copies will cost less, and unique ones with a special set of properties – more expensive.
• The owner can cross all his cats with each other and develop new “breeds”. At the same time, there is a possibility that the new cat will receive new, unique properties that will allow it to be sold at a high price.

The most expensive cat of the CryptoKities project was sold for 600 ETH in 2018. True, then it was equivalent to $ 600, and now it is more than $ 2.3 million.

Another project worth mentioning is CryptoPunks. Its developers offered users 10,000 unique tokens, each of which is a pixelated image of a “punk”. The background color under each image indicates its status:

• blue – “punk” is not for sale;
• purple – there are active bets in the image;
• red – put up for sale by the owner.

For all the simplicity of the idea, the crypto community liked it.Today, more than 615 thousand transactions have been recorded on the platform, for a total value of more than $ 1.78 billion. The most expensive deal is estimated at $ 7.58 million.

Another project, called CryptoCats, completely duplicates the idea of ​​CryptoPunks, although instead of “punks” users are invited to purchase images of digital cats. A total of 630 cats were presented to the audience, which can be bought and resold.

Hype on the NFT theme has spawned many individual projects that rely solely on luck for their success. If you want to go further and start a full-fledged business around an actual topic, contact AVADA MEDIA.

We have experience in launching lucrative NFT projects and we know how to attract audience attention to a new blockchain asset.

For technical implementation, we use modern technologies, including Python, Flutter, PHP, C / C ++, Unreal Engine and many others.

Write to us now, and we will start discussing your project today.