VPN.com NFT Brokers: How To Buy & Sell NFTs (Non-Fungible Tokens)

Michael Gargiulo - CEO, VPN.com

By: Michael Gargiulo, CEO at VPN.com

Updated: 5:56 PM ET Mon, September 13th 2021

NFT non-fungible token art on a colorful background

In recent years, non-fungible tokens (NFTs) have given Internet collectors a new way to spend their cryptocurrency and collect one-of-a-kind assets. NFTs are digital tokens attached to an asset that gives the buyer ownership over the piece. With some NFTs selling for millions of dollars, new NFT brokers are joining the market every day to take part in this booming industry. Open a digital wallet today, and use this guide to start amassing your own NFT collection.

What Is NFT?

NFTs are assets with a unique code that makes them one-of-a-kind. Since they’re non-fungible (or non-tradable), you can’t equally trade one NFT for another. For example, a penny is a fungible token because it’s not unique–you can trade it for virtually any other penny without seeing a change in value. However, a painting like the Mona Lisa is non-fungible because it’s irreplaceable.

Likewise, each NFT represents a unique asset with its own value. When you buy an NFT, you’re buying full ownership of the piece. This means that you can keep it, sell it or display it in your online collection. Other people can look at the file, but you have full ownership and distribution rights. Depending on how they set up the NFT, the original artist might get a portion of the proceeds when you sell your asset.

What Are Some Examples Of NFTs?

NFTs are typically digital assets, but an NFT can be just about anything. Here’s a few examples of NFTs that brokers have bought and sold in the past:

  • Popular online videos, including viral videos or clips featuring a celebrity
  • Virtual goods like Fortnite skins
  • Images that became viral memes
  • Tweets posted by celebrities
  • Digital art pieces
  • Sports collectibles and memorabilia
  • Animated GIFs

While most NFTs come directly from artists and individuals, major brands like Taco Bell have sold NFTs for thousands of dollars. These companies often donate the proceeds to charity.

What Makes NFTs Valuable?

NFTs are valuable because they give you full ownership over the piece. Essentially, it’s like buying an original Georgia O’Keefe painting. Other people can download the file or look at the image, but they don’t own the actual painting. Like traditional paintings from famous artists, there’s only one NFT–and only one person can hold ownership at a time.

When you own an NFT, you own all the value that comes along with it. You can’t sell a screenshot of the piece that you own, but you could sell the actual NFT for potentially thousands or millions of dollars. You also get “bragging rights” over the meme, video, painting or image that you bought. This comes with a lot of clout if you own a piece by a famous artist or a viral video that’s circulated for a decade.

Since anyone can view the NFT records, you won’t have to prove your ownership to anyone. You’re the certified owner of your NFT until you decide to sell it to another buyer. Some people prefer to display their NFTs publicly while others keep them in private collections.

Are NFTs An Investment?

Ultimately, it’s hard to predict how well your NFT will do in the future. Since each NFT is one-of-a-kind, you probably won’t have to deal with market oversaturation. However, market trends and new technology can affect the value of your NFT when you place it back on the market. Some people have bought NFTs for a few thousand dollars and sold them for a massive profit, while others had to take a price drop when they sold their NFTs.

Many brokers see NFTs as an investment regardless of the piece or subject matter. Like cryptocurrency, NFTs represent the future of online business–and as demand increases, the prices may skyrocket. Later advancements could make NFTs even more profitable and valuable. Nothing’s guaranteed, but their non-fungible nature makes NFTs more valuable than tradeable tokens.

How Are NFTs Tied To Cryptocurrency?

Like Bitcoin, Ethereum, and other forms of cryptocurrency, NFTs are recorded in a digital ledger. This creates a public record of the NFT and who currently owns the asset. Some cryptocurrencies like Ethereum have NFT capabilities that allow people to record NFTs in the blockchain as well as the currency itself. Not all cryptocurrencies have this function, so make sure you do some research before you order currency online.

Most of the time, you can’t buy NFTs directly with cash. You’ll need Ethereum to buy NFTs and create a record of your ownership. The majority of NFTs use Ethereum, although you can buy a few with other types of cryptocurrency. Either way, you’ll need to open a digital wallet and buy cryptocurrency online before you start shopping for assets.

Why Do People Sell NFTs?

For artists, creators, musicians and collectors, NFTs have a number of advantages over the traditional online marketplace. Many creators prefer NFTs because they can sell their art directly and keep most of their profits. They can also collect royalties every time someone resells their NFT, which is unheard of in other marketplaces. NFTs also give creators more freedom in selling their work–for example, a musician could choose the marketplace and set their own price instead of relying on traditional streaming services.

NFTs make information freely available to collectors. In some marketplaces, it’s difficult–if not impossible–to verify who owns the asset. With NFTs, the ownership and authenticity are public record. Anyone can look up the ownership without sifting through false, outdated information. There are no secrets with NFTs and cryptocurrency, making this one of the most transparent global economic systems.

Finally, you can sell just about anything on the NFT marketplace. Normally, you need to visit different platforms to sell art, music, streetwear and other collectibles. With NFTs, you can buy and sell GIFs, videos, memes, artwork, digital assets, streetwear and tickets on the same website. Selling NFTs grants you access to a global marketplace that has just about everything in stock.

How To Buy NFTs

To become an NFT broker, you’ll need to open a wallet, find your account and start placing orders. Most brokers start with Ethereum because the majority of NFTs operate under this currency. You might have completed some of these steps if you’ve worked with cryptocurrency before. If not, start from the beginning so you have everything you need to buy and sell NFTs.

1. Create Your Ethereum Wallet

Every broker needs an Ethereum account to manage their cryptocurrency. An Ethereum account is a free account that holds your balance and allows you to send and receive tokens. Each account has a unique address that you use to send currency, like sending an email. You can generate an account without using a wallet, but most wallets create your account automatically.

An Ethereum wallet comes with extra features that make it easier to manage your currency. With your wallet, you can view your balance, send currency, review your recent transactions and keep track of other important stats. Wallets are similar to bank accounts with one major difference–they don’t actually hold your Ethereum. This means that you can switch providers at any time without having to transfer your currency from one wallet to another.

If you’re just starting out, you can get a digital wallet that allows you to access your funds from your desktop or smartphone. However, if you want maximum security, you could purchase a hardware wallet that stores your funds in a separate device. This keeps your information offline to reduce the risk of someone hacking into your funds.

To create your wallet, choose one of the options online, then follow the steps to set up your account and start tracking your transactions. Many wallets allow you to buy, send and receive currency directly from the platform. Some wallets come with a password or key phrase, while others require the use of a “seed phrase” to get into your account. Store the phrase in a safe area so you can recover your account later–if you lose it, you might never be able to recover your funds.

2. Buy Ethereum

Once you’ve set up your wallet, you’ll need to figure out how you want to buy Ethereum. If you already own cryptocurrency, you could trade your funds for Ethereum. However, if you’re just starting out, you’ll probably need to pay in cash. Here’s a few ways you can buy Ethereum online:

  • Visit a centralized exchange where you can buy virtually any type of cryptocurrency with cash. With the peer-to-peer marketplace, you can buy Ethereum from sellers across the globe. Your payment options may include debit card, credit card, PayPal or bank transfer. Centralized exchanges often have additional features like live market tracking.
  • Check out a non-custodial exchange that connects buyers and sellers directly with each other. These exchanges have a streamlined platform that allows you to buy Ethereum within minutes. The platforms can have fewer features than centralized exchanges, but they offer more security because they don’t control any of your information.
  • Order Ethereum directly through your wallet. Many wallets allow you to buy cryptocurrency at the current market price. Some wallets also allow you to swap and exchange cryptocurrencies.
  • Visit a platform where you can swap cryptocurrencies. Once you connect your wallet, you’ll be able to swap your currencies for Ethereum or vice versa. This is a good opportunity to swap any currencies that you’ve had sitting around in your wallet.
  • Go to an ATM. If you search online, you might find an Ethereum ATM in your area. Use your digital wallet to complete the purchase in person.
  • Buy Ethereum from a brokerage app like Robinhood. With Robinhood, you can buy cryptocurrency alongside traditional stocks. Many people appreciate the convenience, but you can’t withdraw the currency from the app. This means that you’d have to sell the currency and use the money to buy it from another platform.
  • Order Ethereum from a payment platform like PayPal. Like Robinhood, most platforms don’t allow you to withdraw your coins from the app, so you’ll need to figure out another way to buy NFTs. However, some people prefer to start with PayPal or Venmo because they’re familiar with the platform.

Each option comes with its own set of advantages and drawbacks. Before you start buying online, do some research to ensure that your chosen method is available in your area. You don’t want to register for an online marketplace only to find that they don’t accept your currency. Some websites require extensive personal information to verify your identity. Additionally, look into the sale and withdrawal times–some websites allow you to buy Ethereum in minutes, while others take much longer.

Before you place an order, pay attention to the service fees. Most services charge a fee, but increased fees don’t automatically mean that the service is more legitimate. Processing fees can rack up quickly, so make sure you know what you’re paying for before you give the site your credit card number.

3. Find An NFT Marketplace

Now that you’ve filled your wallet with Ethereum, it’s time for the fun part: buying NFTs. Online marketplaces like Rarible and OpenSea have millions of NFTs for sale. Choose the site that you want to browse, then create an account and connect your wallet. Browse the categories to find NFTs that you want to buy. The NFT world is always changing, but here’s a look at the assets that you might find:

  • Artwork. This includes digital art, animations, pixel art, GIFs, paintings, repurposed art, photography and multimedia pieces.
  • Music. Artists can sell original tracks, remixes and collaborations through NFTs. Many tracks come with original art or visual elements that accompany the music.
  • Digital assets. Some online games and platforms sell skins, avatars, goods and other assets in the form of NFTs. This could also include keys or treasures that you need to access certain levels.
  • Trading cards. Like physical trading cards, NFT trading cards allow you to collect original artwork, commemorate events and celebrate your favorite public figures. Each collection could have dozens, hundreds or even thousands of cards.
  • Domain names. If someone wants to send you Ethereum, they’ll have to dig up the string of numbers and letters that make up your address. Blockchain domains convert a confusing address into a simple domain name. Like website URLs, you can purchase a variety of domain names with common words and phrases.
  • Virtual world assets. While games like Fortnite have assets that you can buy with cryptocurrency, virtual worlds like Decentraland are 100% fueled by NFTs and blockchains. You can buy land, figures, tools, collectibles, signs and other assets for your virtual world with Ethereum.
  • Rare collectibles. You might find rare and exclusive assets that you won’t see anywhere else on the Internet. Some collectibles have a limited run, making them even more valuable.
  • Miscellaneous. You could find tweets, memes, video clips, physical goods and other items for sale on the NFT marketplace. Classic memes and viral videos have easily sold for tens of thousands of dollars.

If you like one creator’s work, check out their full collection. Many NFT marketplaces have verified creators that produce high-quality work and interact with the community. Note that you’re not always buying directly from the artist–some buyers purchase an NFT, then relist it on the same website. Take a look at the transaction history to see who currently owns the NFT.

4. Buy Your First NFT

Many NFT marketplaces operate like an auction house where you can bid on your favorite pieces. Depending on your options, you could place a bid or buy the NFT outright. Connect your wallet, if you haven’t already, and go through the purchase process. You’ll have to pay an additional Etherum gas fee before you can complete your purchase. The gas fee pays for the computing power that it takes to keep the Ethereum network running.

Once you’ve bought your first NFT, you can do whatever you want with it. Most online marketplaces have online galleries where you can display your collection. Show off your NFT in your gallery, gift it to a friend or place the asset back on the market. Some NFTs come with additional features that you can use along with the image. You can resell your NFT any time–just keep in mind that the value fluctuates along with the market.

How To Sell NFTs

After you buy NFTs, you can resell them on the same website. Most marketplaces have a simple platform that allows you to place the item back on the market and start collecting offers. For some NFT brokers, this is a great way to profit off their investment. Since the value of Ethereum and NFTs is always fluctuating, an NFT that you bought for a hundred dollars could be worth a thousand dollars in a year or so. You can’t predict exactly how your NFT will perform–if the market drops, you might have to sell your collectibles at a loss. Still, you could walk away with more Ethereum that you can use to buy even more exclusive NFTs.

If you want to make your own NFTs, the process is a little more complicated. You’ll start by creating the art, music, video clip or file that you want to sell. Check out some of the popular pieces on OpenSea or Rarible if you need inspiration. Afterward, figure out which cryptocurrency you want to work with. Most people prefer Ethereum because it’s compatible with most online marketplaces, but you might prefer a different currency with a more niche following.

When your NFT is ready to go, upload it to a marketplace like Open Sea or Mintable. You may have to pay a gas fee to cover the cost of keeping the cryptocurrency network running. Most websites give you the option to earn royalties every time someone sells your NFT to another buyer. You can also add special features that don’t activate until the first buyer sells your NFT.

Finally, you might have to pay an additional fee to add your NFT to the marketplace. Afterward, people can bid on your NFT if you made the option available or purchase it outright. They can resell it, keep it privately or store it in their own collections. You can use the Ethereum that you earned to buy your own NFTs or make other purchases.

How Much Can You Make From Selling Original NFTs?

While you’ve heard the stories about people making tens of thousands of dollars from their NFTs, most NFTs sell for a much lower price. You might have to wait several months before you sell an NFT at all. The most popular NFTs often have a famous artist or viral meme attached to them–and if you’re not already established, it’s that much harder to sell your artwork.

You should also keep in mind that you’ll have to invest in Ethereum before you can place your NFTs on the market. Online marketplaces charge Ethereum to “mint” your artwork and turn it into an NFT. On top of that, you’ll have to pay gas fees and possibly additional fees for your listing. Depending on the current price of Ethereum, you might have to invest thousands of dollars into your project.

If your NFTs take off, you could recoup your investment. However, there’s no guarantee that people will buy your artwork. Before you get started, check out the current trends to see what’s selling. Popular NFTs tend to have a specific aesthetic that attracts buyers. It’s not as simple as uploading your old photography–you’ll need to catch the wave to make any sales.

How Do You Become An NFT Broker?

If you’re not satisfied with buying and selling NFTs, you could become an NFT broker. An NFT broker owns a marketplace where people buy and sell NFTs. With the demand for NFTs skyrocketing, you could invest in a secure, high-quality website and start racking up users, assets and website traffic. NFT brokers earn money by charging creators to upload their assets. You could also charge a gas fee so you don’t have to cover the cost of the network yourself.

One of the advantages of running a brokerage business is that you don’t have to pay for physical assets like a storefront or utilities. Like everything related to NFTs, your business is 100% digital. You’ll start with the usual small business fees, then invest in software that keeps your website running. Software operates the major processes so you can focus on other aspects of operating your website.

To maintain a steady flow of traffic, you’ll need an attractive, user-friendly interface that makes it easy to buy and sell NFTs. You’ll also need an option for people to display their NFTs–once they buy them, most people like showing them off. Consider adding community features like a blog, forum, Discord or social media profiles. Some broker websites allow members to message each other directly.

Your users need to know that they can trust your website with their currency, especially since Ethereum can be expensive. Build an encrypted website with security features that prevent hackers from breaking into their accounts. You’ll also need to give your members a way to securely connect their wallets to the site.

In addition to brokerage-specific features, you’ll need to invest in the regular start-up costs like buying a domain name, getting a business email address and hiring a web designer. If you have the knowledge, you could save money by designing your website or creating graphics yourself. The basic appearance of your website could either hook customers or drive them away, depending on the quality.

Ultimately, becoming an NFT broker requires a lot of knowledge about running a business, operating a website and knowing how NFTs and blockchains work. You’ll also have to accept some level of risk since NFTs and cryptocurrency are a relatively new form of technology. Still, you could enjoy decent profits from jumping into a popular, fast-paced industry.

What Are Some Alternatives To Being A Broker?

If you don’t want to commit to being a broker, Forbes lists other ways that you could involve yourself in the NFT industry. Here’s a few ways you could enter the world of NFTs on your own terms:

  • Write an ebook, blog or instructional guide. Many people want to start buying and selling NFTs but don’t understand the world of blockchains and cryptocurrencies. A clear, accessible guide could help more people invest in NFTs or create their own assets. This also teaches them about cryptocurrency and helps them navigate an often-confusing industry. Show people that they don’t have to be a technology expert to use cryptocurrency like Ethereum.
  • Build a community for NFT enthusiasts. This could be a Discord server, online forum, social media page or another community-based platform. People are always looking for ways to share ideas and learn more about cryptocurrency. They could also promote their NFTs and earn more sales in the process.
  • Create software for NFT websites. If you don’t want to build an entire marketplace yourself, you could create marketplace software that other brokers can install. They’ll purchase your software, add their own branding and incorporate it in their websites. This allows you to participate in the NFT community and provide a valuable service.
  • Launch an NFT app. Digital wallets are essential for anyone who wants to buy and sell NFTs. You could create an app that makes it easy for people to view transactions, buy and sell cryptocurrency and check the status of their accounts. Plus, you can include additional features like real-time market values of each type of currency.

To get started, join an existing community and see what people who trade NFTs are looking for. You’ll also pick up knowledge on the way that will help you build a successful career in the industry.

What’s The Future Of NFTs?

Since NFTs are part of an unpredictable market, it’s hard to say how profitable NFTs will be in the future. Fortunately, it’s becoming easier than ever for people to learn about NFTs and start creating their own. In the past, cryptocurrency was part of a niche community; today, it’s a mainstream industry worth millions of dollars.

Some of the benefits of investing in NFTs include:

  • You can enter a booming market where a single cryptocurrency can be worth tens of thousands of dollars.
  • Since the market is always changing, new advancements could make NFTs even more profitable.
  • With millions of NFTs on the market, there’s no shortage of people looking to buy and sell assets.
  • Artists find NFTs appealing because they can earn royalties on every sale, even long after the asset has left their ownership.

However, some of the drawbacks include:

  • It’s hard to say whether NFTs will increase in popularity or eventually fall by the wayside when new technology comes out.
  • If the cryptocurrency market ever crashes, you’ll lose a large share of the userbase.
  • People without technology backgrounds often have trouble understanding NFTs and cryptocurrency, which makes it harder to broaden the community.

Like anything else, buying and selling NFTs comes with a level of risk. However, if you’ve bought and sold traditional stocks in the past, this type of risk is familiar to you. Becoming an NFT broker in the next few years could end up being a profitable decision that makes you part of a cultural phenomenon.

Wrapping Up

Buying and selling NFTs is a complicated process that requires financial investment. If you already have cryptocurrency sitting around in your digital wallet, this is the perfect time to swap your currencies for Ethereum and start purchasing NFTs. While some NFTs sell for tens of thousands of dollars, others sell for less than a hundred dollars, making it easier to start a collection. You can stick to buying and selling NFTs through marketplaces or open your own brokerage website and make profits through usage fees. People with creative talents can sell NFTs online, although you’ll have to pay the marketplace to “mint” your asset. Overall, NFTs are part of a booming market that boasts millions of dollars in sales each year.

en_USEnglish
DMCA.com Protection Status