An unconventional investment tool that came to the limelight in 2021 due to the sale of Beeple’s ‘Everydays: The First 5000 days’ NFT sold for $69 million. This article systematically breaks down the concept of NFT, its history, and how you can build your first NFT!
What Is NFT – Non-Fungible Token?
Fungible means something which can be interchanged for something identical or similar; like dollar and bitcoin are fungible, you can exchange a dollar with another and you will get the same thing in return. But NFTs are Non-fungible, which simply means that every NFT is unique. So if you exchange one NFT for another you will get a completely different thing in return.
Hence, we can conclude that NFTs are one-of-a-kind and non-interchangeable pieces of data. This data is stored on a blockchain, which is a kind of virtual ledger, keeping a track of who is holding and trading NFTs.
What Can Be Sold As NFT?
A simple answer is anything!
Any type of content, including music, drawings, GIFs, tweets, and even selfies, can be sold as an NFT and brought in millions of dollars.
How Has This NFT space Evolved?
Coloured coins (2012)
The idea that gave rise to NFTs was conceived even before Ethereum existed when Meni Rosenfield published a paper in 2012 outlining the “Colored Coins” idea for the Bitcoin blockchain.
The purpose of colored coins was to define a family of techniques for recording and managing physical assets to verify ownership on the blockchain. They are similar to conventional Bitcoins but have an additional “token” element that specifies their usage, making them distinct and separated.
The Colored Coins idea was never realized due to the constraints of Bitcoin, but it did serve as the starting point for the experiments that eventually led to the development of NFTs.
Quantum (2014)
Quantum, a subcategory of NFT’s crypto art, began to appear everywhere. The first piece of art ever to be sold with a certificate of ownership of the kind fetched a record-breaking $1.47 million at a recent Sotheby’s auction.
In order to value and safeguard the true ownership and legitimacy of the artworks, which were then severely screwed up on platforms like Tumblr, the early team, which consisted of Kevin McCoy and an Indian programmer named Anil Dash, thought that a special platform had to be developed.
The repeated instances of duplication and lack of acknowledgment to the artworks bothered them. So, they worked together to create the first iteration of a blockchain-based method for claiming ownership of a genuine digital work, which they ironically named “Monetized images.”
Counterparty(2014)
As a platform that allowed for the development of digital assets, the Counterparty platform (Bitcoin 2.0) was developed and gained popularity.
Spells of Genesis(2015)
Closely followed Counterparty’s lead and started out as a pioneer in the release of in-game assets.
Rare Pepes (2016)
The release of several Rare Pepes on the Counterparty platform heralded the arrival of the meme era.
CryptoPunks (2017)
Some of the first to be built and initially made available for free were CryptoPunks. The experimental project, which was restricted to 10,000 pieces and featured unique characters, was influenced by cyberpunk and London punk culture.
The NFT Year (2021)
The year 2021 was dubbed the “Year of the NFT,” as both production and demand for skyrocketed.
One of the main causes of this surge was the profound shifts that occurred inside the art world and the entire industry when renowned auction houses, namely Christie’s and Sotheby’s, started selling NFT paintings in addition to expanding their online auctions.
As a result, Christie’s sold Beeple’s ‘Everydays: the First 5000 Days’ for a record-breaking $69 million. An enormous transaction from such a famous auction house served as important market validation.
How to build your first NFT?
- Open a crypto wallet account
To create a profile on any marketplace and generate your, you will require a bitcoin wallet. Since Metamask is among the most popular and easily accessible.
There are other options, such as the Coinbase wallet. However, MetaMask’s wallet is one of the ones that is frequently supported by Ethereum-based programs like OpenSea, Foundation, and others.
You will be given a 12-word “seed phrase” when you establish your wallet account; this will serve as your special password. The seed phrase serves as your security code, so keep it private and don’t disclose it anywhere.
- Create an account on an NFT marketplace
Once you are done with your wallet set-up, create an account on an NFT marketplace- Rarible, and OpenSea are the top preferences of people. For convenience, we have used Open Sea as an example though you can choose the NFT marketplace right for you.
Following the instructions, link your Metamask account to your OpenSea account after creating our account (adding a user name, photo, bio, etc.). When you link your two accounts, all transactions will be simple to perform and your NFTs will automatically appear in your wallet.
Make your NFT marketplace account more unique by including a banner image and linking to your social network sites. The more effort spent making sure your social media accounts are linked, the better; the more you devote to adding specifics to your profile, the more apparent your artwork will be.
- Create, Upload, and mint your NFT
Create the art you like to make because an NFT may be any digital asset. There are fairly clear instructions for uploading your art on these NFT marketplace websites like OpenSea, and the procedure is usually the same. Select Ethereum to establish an NFT for free.
Set the price of the NFT. The following options assist you in determining the value and type of NFT you are minting. For instance, select Single to mint a single, one-of-a-kind NFT or Multiple to mint a number of NFTs to mint a collection. Set the price, give it a name and a description, and turn “On” for Free Minting.
Free minting, also known as lazy minting, allows you to pass the cost of minting onto the customer in order to avoid being charged. To mint an NFT, you are typically required to pay “gas costs” — the price of conducting business on the blockchain.
As you are minting, the charge may increase or decrease depending on the volume of traffic on the blockchain; the larger the volume, the more expensive. Late at night or early in the morning is frequently less expensive.
The drawback of shifting the customer’s gas costs is that you might need to reduce your asking price to account for the additional expense, or you might want to mint your NFT as an auction and let the buyer decide.
Meanwhile, try out this free invoice generator to make your work easier.
- NFT is created!
You will see that your work is officially uploaded for auction.
The hard job now starts. It’s best to publish on social media as soon as possible and talk about your new NFT. From within the NFT marketplace, you can instantly connect the new NFT to Twitter, Facebook, and other social networking platforms.
This step-by-step guide is a brief introduction to the process you can dig deeper into each step and select the platform best suitable for you to create your first NFT.
