What is an NFT? (Beginner's Guide)

13 Sep 2021
What is an NFT? (Beginner's Guide) Banner

So you wanna learn about NFTs, huh? Well…you’ve come to the right place! In this article we’ll explore what an NFT is and how to mint one. We’ll also talk about how to avoid scams and cover a couple of general tips and tricks along the way. Finally, we’ll dive into some cool projects for you to consider starting off with. Let’s go!

Please Note - In no way, shape or form should this article be considered financial advice. Always do your due diligence and make an informed decision before committing capital towards any investment.

What’s an NFT? What’s a Blockchain?

So, what is an NFT? Well, that’s a great question. The official definition is:

‘A non-fungible token is a unit of data stored on a digital ledger, called a blockchain, that certifies a digital asset to be unique and therefore not interchangeable. NFTs can be used to represent items such as photos, videos, audio, and other types of digital files’

Now if you’re anything like me, I’m going to take a wild guess and assume that all of the above didn’t exactly hit home, so let’s break it down a little, shall we?

Non-fungible means that the token is more or less unique and cannot be replaced with something else. For example, cryptocurrencies, like Bitcoin and Ethereum , they are fungible because you can exchange BTC or ETH for another currency, be it fiat or otherwise. You can also use BTC and ETH to purchase products or services from different merchants across the world. However, in contrast, something like Cryptopunk #7523 is non-fungible because there is only one in existence, making it unique, scarce and very rare. Morever, it cannot be readily exchanged or converted into another currency or used to make a purchase, hence it is non-fungible.

Now that we have that out the way…What’s a Blockchain? For some of you, this might be something you already know well. But hey, we’re all about learning here at MarketSquare, so it never hurts to refresh your memory, right? Simply put, a Blockchain is the technology that underpins NFTs. While there are several explanations of a Blockchain, we rather like this one:

‘A Blockchain is an open and public network that is secure and extremely difficult to tamper with. Moreover, it allows for the existence and exchange of digital assets that aren’t issued by central governments’

Cryptopunk #7523

OK, I Get it Now, But What Uses Do NFTs Have?

Now that we’ve explained what NFTs are and the technology behind them, let’s dive into why some are selling for thousands or even millions of dollars. We’ll also discuss some of the uses they have and where you might find them…

Collectibles

A common theme we see in the current NFT space is PFP (Profile Picture) projects. This is where 10,000 (or a similar amount) of randomly generated NFTs will be created with the entire process being carried out via a smart contract. An example of a randomly generative PFP project is Lazy Lions that’s been all over Twitter lately.

In these projects, each NFT is entirely unique, meaning no two are exactly the same. Many projects have tons of traits that characters may possess with some being rarer than others. A lot of people like to collect these types of NFTs and flip them for a profit, but some of these projects simply feature such awesome and distinct artwork, which is why their popularity is so enduring.

NFT projects like SuperNfty Floating Heads and Dead Freaks are two of my favorites to date. All Dead Freaks are hand drawn and feature unnervingly ghoulish (or even downright terrifying) monstrosities complete with their own dreadful, shall we say…personalities? Owning a Dead Freak gives you access to the Fang Gang, making you eligible for special drops and more!

In stark contrast, SuperNfty Floating Heads are all hand sculpted in VR (super nifty, right?) and feature lively, colorful floating heads complete with a range of different potential applications. Upon purchasing one, you receive your head’s commercial license as well as a 3D printable file, metaverse file and more! See? I told you they were super nifty!

Gaming

NFTs and Gaming: a match made in heaven. You can check out my esteemed colleague Matt Spizarny AKA Spizzo’s article on Gaming & NFTs and why they go so well together here

One of the main points here is that you can truly own really cool stuff in a digital world. Nobody can take your in-game items away from you because you own them. Additionally, they exist on a decentralized network and are inaccessible to anyone but you. You can sell your items, trade them, level them up to make them rarer…it’s just fantastic! Some Blockchain games I think are pretty rad (and ones you may want to check out soon) include Blankos: Block Party , Lost Relics and Ember Sword .

Access Tokens

Finally, NFTs can be used as access tokens. GET Protocol is one such example of an entity that fulfills this flawlessly— they help anyone who issues tickets to take advantage of the digital world by turning tickets into…you guessed it: NFTs!

Now transforming tickets into NFTs has many advantages. First off, it makes tickets into collectible items that have (and may very well increase in) value. Secondly, organizers get total control over the issuing process as well as insights into both the primary & secondary markets. Lastly, organizers and performers receive all the profits that would have otherwise gone to scalpers and intermediaries. In short, GET is making serious progress in fundamentally changing the way the ticketing industry operates.

The above are just a few of the current uses for NFTs, but in my opinion, the possibilities are virtually endless!

How Do I Mint an NFT?

So in this section, I’m going to take you step-by-step through the minting process so that you can purchase your first NFT. This is going to be a lot of fun, so without further ado, let’s dive straight in:

Before we begin, you’re going to need a few things to get started:

  • A MetaMask wallet
  • Some ETH, and
  • An OpenSea account (which just means you’ll need to log in to your MetaMask wallet)

As a newbie, you can buy ETH directly inside your MetaMask wallet by clicking on ‘Buy.’ The following image demonstrates how to buy some ETH:

Once you have your wallet set up, OpenSea account and some ETH, it’s time to mint your first NFT! How exciting!

Now comes the hardest part: finding an NFT project you actually want to invest in. There are thousands of NFT projects out there, and it can be really difficult to determine which ones will do well and which won’t. However, these are a few factors I like to take into account:

  • Artwork - Is it distinct, memorable and relatable?
  • Community - How active and united are the community?
  • Developers - Are they trustworthy, driven, forward-thinking and innovative?
  • Roadmap - Is there a roadmap for the project? What releases are planned and how will they help to grow the community and project as a whole?

So let’s take Approving Corgis as an example.

Approving Corgis is a collection of 9,999 adorable corgis living on the Ethereum Blockchain, generated using 350+ unique attributes. Awesome, now let’s say you want to mint one. First, head over to their website and click the Mint button. We can see that 2,191 have been minted, so there’s still plenty left to purchase.

After clicking the Mint button and connecting your wallet, the site will tell you the minting price and ask you how many you would like to mint. In this case, let’s say I want to mint 1. After inputting the amount I’d like to mint, I click the Mint button.

After hitting the Mint button, your MetaMask will pop up at the top-right of your screen. Here you can review your transaction. The details include the minting price, which in this case is 0.05 ETH plus gas fees.

Hold on a minute…what are gas fees!? These are payments made by users to compensate for the computing energy required to process and validate transactions on the Ethereum Blockchain. Gas fees can vary drastically and sometimes be very high, making your transaction significantly more expensive. You can check what price gas is currently sitting at here .

Congrats! You’re ready to mint! Just hit the Confirm button and let the Blockchain do its job. In a few minutes, you should see your brand new NFT show up in your OpenSea wallet. Easy as that! Wasn’t so hard, was it?

Depending on the project you’re minting from, there may not be an instant reveal. This means you will have to wait until your NFT is available to see which one you got and what traits it has. This isn’t really a big deal, but it varies from project to project, so just be sure to check their website before minting so you know what’s up!

Tips & Tricks

Let’s run through some final quick-fire tips and tricks, shall we?

  • Never give anyone your private keys or seed phrases under any circumstances whatsoever
  • If MetaMask isn’t working on Google Chrome, try Firefox
  • Be sure to always double check that you are on the project’s official website and/or OpenSea
  • Losing Gas Wars? Check out this helpful guide by thedigitalvee
  • If the Mint button isn’t working on the project’s website, try minting directly from the smart contract. Check out this helpful guide by ColeThereum on how to do this
  • Check out this MarketSquare video to help you avoid rug pulls and scams

Check Out These Awesome Projects

Before we conclude this article, let me show you some of my favorite NFT projects in the space right now 👀

Lazy Lions

0N1 Force

Lonely Alien Space Club

Axolittles

Conclusion

Well, that’s it for this special little Guide. You now know what an NFT is, exactly how to go about minting one and a couple of sweet tips and tricks from yours truly. You’re most welcome!

If you have any more questions for me, make sure to Tweet at me @ReeceSmith_ARK and catch me hanging out in the MarketSquare Discord .

Now…let your NFT addiction…BEGIN!

Reece is a video editor and Blockchain Games researcher at MarketSquare.io. He moonlights as a twitch streamer and can often be found slaying wither skeletons in Minecraft when not hunting for the latest NFTs.
Tags:
NFTs
Minting
Guide

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