Occasionally, we use the term “modern art” to describe a gorgeous snapshot of a sunset taken with our smartphones or a doodle made on our iPads. However, we never consider the possibility that someone would purchase our modern art masterpiece for even a $1, many alone millions.
Now, as a result of the NFT (non-fungible token) frenzy, what you’ve created might be regarded as unique and be worth millions of dollars.
The improbable piece of contemporary art below sold for $6,600,000 on the NFT marketplace.
How to Create and Market NFTs – Detailed Guide
In brief, there are three components to the creation and sale of NFTs:
- Create your digital art
- Buy Ethereum
- Open a digital wallet
Below, we will explain each of these in detail.
1. Create Your Digital Art
To answer the seemingly hard issue of how to make an NFT, one must first grasp what an NFT is and what goes into its creation.
We live in an NFT-obsessed society in which almost anything can be converted into an NFT. Currently, NFT markets offer jokes, recipes, digital art, tunes, and occasionally even whole enterprises. There are presently few restrictions on the content types that can be “tokenized” and converted into NFTs.
Due to the immaturity of the technology, now is an ideal time to experiment with it for your own work, while the market and demand for digital art continue to grow. Unspoken policy dictates that copyrighted material or assets should not be converted into NFTs.
Now that we understand what an NFT is and how to generate NFT art, a significant question arises: why don’t we simply get this art off the internet? The short answer is yes. In reality, millions of people have seen Beeple’s artwork, which sold for $69 million, and the picture has been duplicated and shared countless times. Moreover, the artist retains copyright ownership of their work in many instances, allowing them to continue making and selling copies. In contrast, the purchaser of the NFT owns a “token” that confirms ownership of the “original” item.
Creating an NFT is comparable to posting a product for sale or auction on a website like eBay. There are other NFT markets with unique names, like OpenSea, Rarible, SuperRare, AtomicMarket, and BakerySwap. After making an account on one of these websites, you can create an NFT by uploading a digital version of your assets, such as a picture or original design.
2. Buy Ethereum
You must decide beforehand which blockchain you will use to issue your NFTs. Ethereum is now the most popular blockchain platform for the issuance of NFTs. Each blockchain has its own standard for NFT tokens, wallet services, and marketplaces.
In this post, Ethereum will serve as the benchmark for describing the procedure. Following this, we will describe how to acquire Ether and how to set up a digital wallet via which you may buy and sell NFTs.
There are several ways to obtain ETH. We recommend purchasing it through an ASIC, CySEC, and FCA-regulated exchange such as eToro. You may acquire Ethereum with eToro by following this step-by-step guide:
Step 1: Create an eToro account.
Go to the official eToro website.
Step 2: Verification of Account
eToro requires account authentication to maintain account security. You need to present valid proof of identification (such as a passport or driver’s license) and proof of residency (such as a bank/credit card statement or an internet bill).
Step 3: Make a fiat money deposit
Once your account has been authenticated, you may begin. Follow these procedures to put fiat currency into your new eToro account. You must have fiat cash in your eToro account in order to purchase Ethereum.
Step 4: Buy your initial Ethereum
Once your money is in your account, you’ll be ready to go! Simply navigate to the Ethereum website and do your initial transaction.
3. Open A Digital Wallet
The next stage is establishing a digital wallet, such as MetaMask. To transact on the Ethereum blockchain, a wallet that supports ERC-721 (the Ethereum-based NFT token standard), such as MetaMask, Trust Wallet, or Coinbase Wallet, is required.
The following is a step-by-step instruction for opening a digital wallet such as MetaMask:
Step 1: Download and Install MetaMask
Visit the MetaMask website, where you can find download instructions and a list of browsers that support the MM browser plugin.
MM is now only accessible on Chrome, Firefox, Brave, Microsoft Edge, and as an app for iOS and Android mobile devices.
Step 2: Establish an Account
If this is your first time building a software wallet, you should select “Create a Wallet” as your starting point.
Use “Import wallet” if you already have a software wallet (Atomic, Exodus, Rainbow, eToro, etc.) and desire to switch to MetaMask. You may also decide to move to a different wallet supported by your preferred marketplace.
Step 3: Configure Settings
This phase includes customizing settings to your specifications. You can experiment with various settings until you find one with which you are comfortable.
Step 4: Add Funds
The two most common ways to add a token to your MetaMask wallet are via an exchange (Coinbase, eToro, etc.) or by purchasing ETH using Wyre, MM’s default payment interface.
Step 5: Purchasing NFTs
After creating, exploring, and stocking your wallet with tokens, you may connect to one of the many NFT marketplaces to purchase, sell, and trade NFTs.
The following are other wallets supported by the OpenSea marketplace:
- Coinbase Wallet – The Coinbase Wallet software provides users with a dApps browser to explore the decentralized web. It is one of the most favored and trustworthy among all others. Clicking on this link will allow you to create your account.
- TrustWallet is a non-custodial mobile wallet that securely saves your private key locally.
- Portis – Connect to dApps using an email account and password from virtually any web browser and device, including mobile phones.
- Fortmatic / Magic — A wallet that allows you to join up with your phone number from any device, created by a creative team.
- Arkane – All a user needs to utilize the Arkane Network wallet is a computer and web browser.
- A wallet focusing on usability, with no transaction fees and a fiat entry point.
- Bitski is a wallet that allows users to join up using an email address and password.
- Dapper is a browser plugin that compensates for your petrol expenses.
- Kaikas – A browser plugin that allows websites to engage with the Klaytn network. Here is where you can download Kaikas for Chrome.
How Much Ethereum You Would Need To Create An NFT
The price of Ethereum fluctuates from second to second, making it difficult to follow. The easiest way to get started with Ethereum is to pick how much money you wish to spend and then acquire exactly that amount.
Wallets such as the aforementioned MetaMask wallet permit direct bitcoin purchases from the wallet. You must make a second exchange buy and transfer the funds to your Coinbase Wallet.
For instance, as of October 28, 2021, the price of Ethereum has fluctuated by about $400 USD in the previous 24 hours. Therefore, it would not be prudent to make an estimate in a market with such volatility.
What Other Blockchains Allow You To Make NFTs
Polygon (formerly known as the Matic Network) is a separate blockchain that enables scalable, secure, and rapid transactions with Ethereum-based tokens like ETH, USDC, and DAI.
Beginning in July 2021, users will be able to use Polygon to make, purchase, and trade NFTs without paying transaction fees, enabling a gas-free marketplace.
Klaytn might also be an option. Klaytn is a blockchain that was developed by the Korean internet business Kakao. By utilizing the Kaikas wallet browser extension, users may buy and trade Klaytn NFTs on OpenSea.
Discover A Marketplace And Link Your Wallet
The following exchanges are frequently cited as the greatest FCN markets.
OpenSea is the first and largest P2P NFT marketplace. According to the analytics website DappRadar, it has a cumulative trade volume of over $6.5 billion as of September 2021, permitting NFTs of anything from in-game assets and collectibles to artwork, music, and GIFs. Signing up is as easy as attaching your MetaMask wallet, and additional wallets like Coinbase Wallet, Bitski, and Formatic are also supported.
Rarible is a community-owned marketplace that provides an extensive selection of digital art and collectibles. It is among the most important NFT marketplaces on Ethereum. It is the fifth-highest trading volume of all time, according to Dappradar, with $210 million changing hands. Similar to OpenSea, you are able to buy and sell various types of material. Additionally, sellers may produce several NFTs for a single image and sell it multiple times.
SuperRare touts itself as a little more premium alternative to Rarible; whereas Rarible’s interface bombards you with a dizzying array of flashing GIFs and live auctions, SuperRare’s design is far more streamlined and simple.
Following these instructions, a user can connect their OpenSea to their MetaMask wallet.
Tap the profile icon located in the upper-right corner of the OpenSea page.
- Click “Get MetaMask.”
- Choose “Install MetaMask” for Chrome or your preferred supported browser. This will install a Chrome extension.
- Select “Get Started”
- Choose “Create Wallet”
- Select “No thanks” to decline to provide input.
- Establish your password.
- Notate the secret phrase it provides. This is extremely crucial and serves as your backup account access information. Avoid losing it.
- Tap “Next” and then confirm the password.
- Click “Next” to link your OpenSea account to the newly formed MetaMask digital wallet.
- Click “Connect” one more.
Mint Your NFT
By minting an NFT, your digital artwork gets added to the Ethereum blockchain, an immutable and tamper-proof public ledger. Similar to how physical currencies are produced and introduced to circulation, NFTs are tokens that are “minted” upon creation. Your digital artwork is represented as a non-fungible token (NFT) so that it may be purchased, exchanged, and digitally tracked as it is resold and collected in the future.
How Can You Cash In Your NFT On Open Sea?
Open Sea is now the largest NFT marketplace; consequently, it serves as an excellent illustration of how to create an NFT.
Step 1- Connect your crypto wallet
If you do not already have a crypto wallet, you must first download one. To interact with decentralized networks such as OpenSea, wallets are utilized. Using your wallet, you will be able to transfer and receive ETH, the cryptocurrency used to purchase and sell NFTs on the platform.
Step 2: Establish a collection
After connecting your wallet to the site, the next step is to build your collection. Select “My Collection” in your profile’s upper-right corner. Select ‘Create’ to begin a new collection. Your collection will resemble a digital portfolio or album.
Step 3: Exchange your NFT
After building your collection, click the ‘Add New Item’ button to mint your first NFT. Upload your NFT file and name it. You may then add features, levels, and statistics, which are effectively additional descriptions, to your digital collection. That concludes the discussion.
Your NFT is shown, allowing you to review all of its data. You can either keep or sell the NFT. To sell it, click the ‘Sell’ button in the upper right corner. Before you can advertise your first NFT for sale on OpenSea, you must pay a gas cost. You have the option of choosing a price or auctioning your NFT (you have the option to add a minimum bid). Click “Post Listing” and “Sign Transaction” thereafter. Now, all you must do is wait for a collector to purchase your artwork.
List It For Sale
To list your NFT on Open Sea, choose your profile image in the upper-right corner of opensea.io and then click Profile.
Select the NFT you wish to sell from your wallet. If you do not currently have an NFT to sell, please review our guide on how to create one. To access the listing page, choose to sell in the upper-right corner. You will be sent to the listing page, where you may specify the price and product type. A sale with a “Fixed Price” is one in which the price does not fluctuate. Auctions are an alternative.
One is the English Auction, in which OpenSea will automatically finish this transaction if a “Sell to the highest bidder” auction closes with a price greater than 1 ETH, with OpenSea covering the gas fee. Similar to fixed-price ads, but with a decreasing price over time, is the Dutch Auction. At any given time, you can purchase or sell the mentioned currencies.
You will be required to sign a transaction to finalize the sale. If this is your first time selling on OpenSea, you will first need to create a wallet. Additionally, if the item you are promoting was not coined on OpenSea but rather through a bespoke contract, OpenSea may require an extra clearance and signature before trading it on your behalf.
What Are The Fees That NFT Exchanges Take?
The majority of NFT trading platforms charge a fee known as “gas.” On their blockchain platform, this fee is required to perform a transaction or execute a contract. Gas expenses in Ethereum are stated in Gwei units. This is determined by the volume of network traffic and the computer power necessary to perform a transaction. On the Ethereum network, users must pay gas fees to compensate for the computer power required to execute transactions. This is comparable to the fees imposed by credit cards for inter-account transfers and bill payments. Successful miners who are able to solve complex issues are rewarded for their efforts because doing so needs a significant amount of computing power. As a result of this encouragement, they will continue to assist transactions. The entire transaction cost is therefore equal to the gas limit multiplied by the current gas price.
Every transaction on the blockchain is processed and validated by miners using sophisticated technology and large amounts of power. The amount of computational labor required to do this is referred to as “gas.” To do the computations, miners must be compensated with gas costs. On the majority of NFT marketplaces, users must pay gas expenses while selling, buying, and minting NFTs. The fee is determined by the number and kind of calculations required to validate transactions. When your NFT is sold, OpenSea will charge the seller a commission fee of 2.5%. Other NFT markets may collect this charge in a variety of ways.
- Rarible levies a 2.5% fee, which is paid by both the buyer and seller.
- Nifty Gateway adds 5% + $0.30 to the price of every secondary sale.
- The customer pays a 3 percent transaction fee for each purchase made on SuperRare.
- The Foundation levies a 15 percent transaction fee, which is paid by the vendor.
For example, say you sold an NFT for $1,000 on OpenSea. You must pay a commission fee equal to 2.5 percent of $1000, or $25. This cost varies based on the marketplaces where these transactions take place.
Will You Be Able To Sell Your NFT Without Marketing?
Marketing is an essential stage preceding the sale of your NFT. People will not purchase your NFT until you market it effectively. Several NFT marketing organizations offer media relations and influencer marketing to attract customers. Communication is essential to controlling an audience. To attract more bids, for instance, make your community informed about the approaching drop. Social media marketing and content marketing are crucial for community building and bid participation. To enhance earnings from NFT sales, you must properly promote your NFT. Because your NFT community consists of individuals who will spread the news about your new NFT, community engagement is a crucial feature of NFT marketing.
How Do Celebrities Promote Their NFTs?
Celebrities utilize their influence to promote NFTs in various ways. Some musicians have tokenized their songs, singles, and albums and sold them directly on the NFT market, eliminating the need for intermediaries. In March of this year, the American rock band Kings of Leon released their new album “When You See Yourself” as a compilation of NFTs. Each token contained a unique work of art as well as a limited-edition “Golden Eye” record.
Celebrities have begun tokenizing social media postings and remarks despite the ease with which they may be duplicated or screenshotted from the Internet. The founder and CEO of Twitter, Jack Dorsey, chose to contribute his first tweet as an NFT. Sina Estavi, CEO of Bridge Oracle, purchased the “product” for $2.9 million on March 21, 2006, when the tweet “just putting up my twttr” was released.
How Can Average Citizens Promote NFTs?
Common individuals may promote their NFTs in a variety of ways to ensure they receive a decent price when selling them. Listed below are a few examples:
Developing an NFT community
Creating a community for your NFT on platforms like Telegram, Discord, Linkedin, Medium, and Reddit is one technique for selling your NFT. Start sharing blogs that inform people about the significance of NFTs. Due to the novelty of non-fungible tokens, you should post instructive films and utilize a narrative approach to assist consumers to comprehend them. Start engaging in topical talks and aiding community members. Your contributions, recommendations, and comments need to be beneficial to crypto enthusiasts.
Implementing Search Engine Optimization Strategies
Increasing your website’s visibility through search engine optimization is another excellent way. You desire individuals seeking NFT markets or attempting to get a specific NFT in your niche to discover your NFT. Investors in NFTs typically utilize search engines to identify the best NFTs to purchase. This is when SEO becomes useful. Working with an SEO service may help your NFT website improve in the search ranks, resulting in an increase in relevant organic traffic.
As the popularity of NFT increases, you will receive more offers and thus better prices. A little investment in SEO can pay off handsomely in terms of NFT income over time.
Disseminate information through Press Release
Your NFT’s debut should be a major event. Press releases are an efficient method for reaching out to various media sources and spreading the word about the launch of your NFT, and the news of your NFT debut may be picked up by other websites that syndicate media content. This will enable your NFT to reach a bigger audience, and more people will become aware of your NFT marketplace.
Cryptocurrency marketing services such as CryptoPR.com may coordinate public relations among cryptocurrency media on your behalf.
Using Content Development
You must convey your NFT endeavor to the community in simple words. Using content marketing, you may educate prospects about your product in a number of methods. This may be achieved through the use of lengthy articles, infographics, keyword-focused blog postings, and other techniques. You may also post your articles on Hackernoon, Howtotoken, and Cryptopanic, in addition to Pinterest, Reddit, Quora, LinkedIn, and other social networking platforms.
What Returns Can You Expect?
The creation of NFT art does not necessarily need money, but posting it to the appropriate platforms typically incurs a charge. The cost of minting non-fungible tokens can range from less than one dollar to more than one thousand dollars, mirroring the rise in popularity of non-fungible tokens (NFTs) in recent years, which now encompass a vast array of items ranging from art to audio files to virtual goods. Numerous popular NFT wallets allow you to mint completely free of charge, while others charge between $70 and $120 to help you get started.
During peak periods, prices have increased by $200-$300. When searching for a new platform on which to mint your NFT, it is essential to undertake exhaustive study and due diligence. When it comes time to set up your new NFT, you’ll want to choose a system that is easy to use, secure, and safe to transact with, but won’t drain your bank account.
Frequently, NFT minters are forced to pay fees upfront, although some platforms demand artists to pay a portion of the final sale price for an NFT they’ve made, such as 3 percent. Open Sea permits you to generate an infinite number of NFTs for a one-time fee of $150. On some sites, such as Valuables by Cent, miners are exempt from paying fees. Others do not charge fees to mint NFTs on their platform, however, some platforms do charge fees to sell NFTs.
The other type of expense related to NFTs is the cost per sale. The marketplace will bear the expense of minting the NFT, but when the art is sold, they will earn a larger share of the transaction than before. You will also need to look out for a range of additional costs that may be added to whatever you buy, sell, or trade. Open Sea receives a 2.5% commission on any sales made via the website.
This looks to be one of the more reasonable fees among the major markets, with some platforms charging up to 7.5%. Depending on how you choose to advertise your NFT, it is not always necessary to spend money. Creating a community to communicate with on Telegram or Linkedin is free of charge. If you wish to boost the visibility of your NFT through search engine optimization, however, you will need to pay the SEO agency.
Despite the fact that NFTs have been accessible for quite some time, the market for them has lately exploded as mainstream corporations and investors have entered the market. However, despite the hype, just like cryptocurrencies or any other speculative asset, NFTs include significant dangers that individuals should be aware of before investing. The NFT market is very volatile since there are no mechanisms in place to aid customers in pricing assets.
Will You Be Required To Pay Taxes?
Similar to cryptocurrencies, NFTs are taxable property. How taxes are applied to non-financial assets depends on how you interact with them.
You can participate in NFTs in one of two ways: by producing and selling them on a marketplace, or by purchasing and selling them as an investor. The creation of an NFT is not a taxable event on its own. However, selling the NFT on a marketplace like OpenSea or Rarible is. If you sell an NFT, you will be required to pay taxes on the proceeds.
Her Majesty’s Revenue and Customs (HMRC) is responsible for tax collection in the United Kingdom. Although there is no published HMRC advice on the tax treatment of NFTs in the United Kingdom, it is likely that they would be considered a taxable asset for capital gains and inheritance tax purposes, in addition to being taxable in other ways.
Existing HMRC guidance only pertains to trade tokens like bitcoin and does not examine how the tax position of a tokenized asset may differ. In reality, no taxing authority in any jurisdiction has yet provided recommendations on NFTs or asset tokenization. The issue of a token’s tax location, which is significant for UK residents with a foreign domicile who claim the remittance basis of taxes, is especially complex.
Cryptocurrencies and non-fungible tokens are taxed using the same principles. A non-fungible token (NFT) is a unit of data that is kept digitally. Given that NFTs are unique, they cannot be utilized interchangeably. A non-fungible token can be used to represent an ownership share in any tangible or intangible asset, even if the object is held off-chain. The tax status of an NFT depends on how it is utilized, why it is retained, and why it is transacted.
Depending on the terms of the NFT smart contract and the rights it confers, you can pay tax on the NFT in a variety of ways, including under the capital gains tax (CGT) system, on revenue account as trading stock or as part of a company or profit-making scheme, or a combination of the above.
The United States Internal Revenue Service has not adopted an official position on how NFTs should be taxed. NFTs may be taxed similarly to cryptocurrencies, which are treated as property and subject to a long-term capital gains tax rate ranging from 0% to 20% based on your income.
Alternately, NFTs might be regarded similarly to stamps, antiques, and trading cards and be subject to the collections tax, which is significantly higher at 28%. This difference is only called into an issue when assets are kept for over a year. NFTs sold after a holding period of less than one year are subject to short-term capital gains tax rates, irrespective of whether they are deemed property or collectibles (which are the same as regular income tax rates).
Through this essay, we have attempted to answer one of the most typical and apparent questions a newbie would have: how to create an NFT and sell it in a market that is both very competitive and booming. In addition to providing a quick introduction to the NFT economy, we have attempted to discuss with our readers how much capital they must invest in order to get big profits from them.
NFTs have significantly helped the creative community. Without having to worry about intellectual property concerns, artists, musicians, and others suddenly have a new money stream (IP).
It is also an innovative way for investors to invest their funds. One may conclude that now is an excellent moment to enter the industry and earn a respectable income. We propose the regulated exchange eToro for buying ETH, ENJ, or AXS for NFTs.
To learn more, click here.