The Business of NFTs

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It won't be out of place to assume everyone reading this post has an idea of cryptocurrency and the revolutionary technology called the blockchain. But in case there is anyone with no knowledge of this or still finds the whole concept confusing, not to worry, I'll give a background overview of it.

Cryptocurrencies are currencies built on a blockchain, and they hold value and can be exchanged and stored. A blockchain is a decentralized digital ledger that keeps information and transaction details. The blockchain is transparent, immutable, secure, and scalable. The immutability of the blockchain means that transactions are done on the blockchain can't be altered with or reversed.

As earlier stated, cryptos are digital tokens that hold value and can be exchanged and stored. Bitcoin, the first cryptocurrency and the most popular, is used for peer-to-peer transactions that include paying for products and services, can be traded for other cryptos or fiat, and can be stored just like gold but digital. Bitcoin can be swapped for another bitcoin, and bits of it (called satoshi) can be swapped for bits of other cryptos or fiat making it fungible (that is, the ability to be exchanged for something of equal value)

What are NFTs?

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NFTs stands for Non-Fungible Tokens; this means tokens that can't be exchanged or replaceable because it is unique and has no inherent value. NFTs are proof of ownership of digital artwork, memes, or music. A digital artist can now mint their artwork on a blockchain, hold the artwork's license, and claim royalties of the artwork from subsequent sales.

The value of an NFT is determined by the amount individuals are willing to pay for it, so an increase in demand brings about an increase in the value of an NFT as it is with any artwork.

The Business Of NFT

In a general sense, the business of crypto is generally centered around buying and selling, but there is way more to it, especially with NFT. The business of NFTs can be broken down into various categories, and here is a list of business opportunities provided by NFTs.

1. Create Your Own NFT

Creating your own NFT is the most lucrative aspect of the NFT business as it allows you to set the sale price and claim royalties from subsequent sales. The process of creating/minting an NFT is not as hectic as it may seem and can be done using the following steps.

• The first step is to decide what type of NFT you wish to create, as it can range from artworks, music, poems, memes. This is important because you're trying to create something you hope people will be willing to buy, so deciding what to create or mint is the first important step. Items minted as NFTs have to be unique and solely owned by the creator (you can't take someone else's art and mint as yours)

• The next step is to choose the platform on which you will mint the NFT. There are presently a bunch of platforms that support the creation of NFT, like the Opensea and Rarible, two of the most popular NFT minting platforms. Ethereum is the most used blockchain for minting NFTs, but other blockchains like polygon, Tezos, Solana, among others, are also used.

• Creating your NFT is the next step. There are different approaches and methods used to create an NFT, so do your research to find out the one best suits you. After creating the NFT, you mint it on your preferred platform.

• The final step is to sell your NFT. This is the most exciting step for the business-minded, but all other steps are essential as they all lead to this step. First, you set to list your NFT for a value, say 0.5 ETH, and set your royalty fees.

The fun thing about creating an NFT is that it is as simple as creating any other content as an artist and uploading it on the internet, just that in this case, you own it, and the world can see proof of ownership, and you can market your content yourself with little or no cost. It is also important to note that joining communities help in improving your chances of getting your content sold and valued high.

2. Buying and Selling of NFTs

You can buy, and resale an NFT using platforms called the NFT marketplace. NFT marketplaces have multiplied since the past 1-2 years, but below is the top NFT marketplaces list.

• Opensea

• Rarible

• Niftygateway

• NBA Top shot

• Mintable

• SuperRare ,etc.

These platforms differ in operations, so make sure to research them and choose the marketplace that best suits you. Another thing to consider when buying an NFT is the reputation of the NFT that is being purchased.

The digital artist plays a significant role in how the art is being valued and its demand, so make sure to buy art created by a notable digital artist. Top NFT digital artist includes;

• Beeple

• Pak

• Winkelmann

• Larva Labs

• Justin Blau

• Gary Vaynerchuk

• Blake Kathryn

These and some more are the top digital artists that have earned their place, following, and respect in the NFT digital world, meaning art from any top-rated artists not only has a resale value but also has the potential to increase in value. The uniqueness, popularity, and rarity of NFTs are essential when making an NFT purchase. Below is a list of some of the top-rated NFT projects to trade on

• VeeFriends

Created by Gary Vaynerchuk, VeeFriends is an NFT ticket that gives holders access to Gary Vaynerchuk's multi-day super conference called the VeeCon.

• Invisible Friends

Created by animator Markus Magnusson is set to launch this month, February 2022. It already has a massive following on social media, which should boost its demand and value.

• Women Rise

Created by Maliha Abidi is an NFT collection that focuses on increasing women's participation and women characters in the NFT world. Driven by such motive, it has gained a following on social media.

There are many NFT projects to trade on; do your research on the project that best suits your investment plan and trade on it.

3. Incorporating NFT into your Business

As an entrepreneur, business owner, or freelancer, you can accept payment in NFTs or add it as a payment option. An example of this is the Flyfish Club, a private diner owned by Gary Vaynerchuk that accepts the flyfish club NFT membership token as payment and can book reservations of up to 8 persons.

Incorporating NFT into your business gives you an edge as it opens a new payment option and an opportunity for a new set of customers to patronize the business. It also provides the business or you an image of being forward-thinking and moving with the trend. It is not new to accept crypto as a means of payment as many businesses, both big and small, have adopted it as a payment option; including NFT as a payment option adds to the current trend.

Challenges Of The NFT Business

The first challenge facing investors of NFT is that it is a new market and, as such, has not experienced the test of time. Some critics feel the NFT rave is a bubble that might blow up in our faces. This might be true, but all business comes with its risks, and the business of NFT is no exception.

Another challenge those in the NFT business face is determining the right NFT project to invest in. Many NFT projects are floating around, and it might seem frustrating to shuffle through the noise to get the best project that falls within their capital range.

Creating an NFT and listing it on any NFT marketplace does not automatically guarantee a sell. Creators of NFT have to join social media communities on platforms like Twitter and discord and do some marketing to sell their content. It helps if the content creator is famous or a celebrity and has a good following.

Conclusion

NFT has proven to be a source of income for many, be it as a digital artist or as an NFT trader lots of individuals have had huge paydays due to the growth and lucrativeness of the NFT business.

The business of NFT is still new even to the crypto world. It is important to note that there are hurdles to be faced when embarking on any business venture, so proper and intense research is advised to be done before investing your capital.

_{Disclaimer: This is not financial advice as I am not a financial advisor. To get financial advise meet a professional financial advisor}