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Beginners Guide: Crypto Art and NFTs!
What the hell is an NFT and why do I keep hearing about this? This is the article for you to learn the basics of an NFT and why its going to change the art/digital collectibles world.
You most likely got here from searching online, coming up on my profile or your friends have been begging you to research about it!
Either way, this article will run you through the complete basics of Crypto Art and an NFT is so you can finally understand the basics.
NFTs have allowed digital art to be treated like physical art. They allow the authenticity of an artwork to be shown globally and it can be a 1/1 artwork that proves ownership. Digital Art can be exchanged digitally meaning it doesn’t have the limitations of physical art (being lost, damaged, lack of space) and more.
This allows the value of an NFT to increase just like physicals but they are way more accessible then physical art pieces. You also see physicals backed by NFTs so it goes both ways!
You also have digital collectibles such as CryptoPunks & NBA Topshot that have the same benefits compared to Pokémon cards, just like art.
→ What is an NFT?
An NFT (non-fungible token) is a way to prove ownership of an asset, both digital & physical — an asset could be anything ranging from art, virtual items, music, etc. It proves ownership of an asset by utilising the blockchain; a public, permanent and immutable ledger which contains all transactions that occur between parties. This allows anyone to view the current owner of an NFT as well as all previous owners. Think of a ledger as a book that cannot be erased and it holds every detail of a specific transaction on it.
An NFT has a unique ID on the blockchain meaning it cannot be forged nor duplicated by any means.
Imagine an artwork that you purchase that comes with an NFT, its all digital and transparent so anyone can see the transaction! This is why an NFT is valuable when linked to an artwork or digital item.
But can’t you just screenshot it for free?!
This is a common question people have when you first discover Crypto Art & NFTs. The short answer is that you can. You can screengrab it and save it on your computer forever. However, this doesn’t mean you actually own the NFT.
You can buy a painting by Pablo Picasso online for $100 that looks exactly the same as his other paintings but its not worth millions like his original paintings because you have no proof of ownership. Its just an artwork. Collectors are buying the artworks that are backed by an NFT so you can verify the authenticity of it.
In the Crypto Art world, the general currency you will have to get used to is Ethereum.
A crypto-currency is a digital asset designed to work as a medium of exchange where the transactions are all recorded on a permanent ledger, the blockchain. You can buy goods & services or trade them for profit. They are also liquid meaning that you can transfer them into real cash (fiat) using exchanges.
Typically in the Crypto Art world, platforms require you to own a wallet where you use these Cryptocurrencies, particularly Ethereum, to control your artwork and mint it. Your funds will show up in these wallets which you can then transfer into fiat whenever you want.
Ethereum is the second biggest crypto-currency and the main currency used for purchasing Crypto Art and NFTs. Typically, the main thing you’ll have to understand is that you have to pay ‘gas’ for a transaction.
Gas is not talking about fuel for your car… but rather fuel for the miners. Ethereum miners donate computing energy to process and validate transactions on the blockchain and they decide how much you have to pay per transaction. Gas varies and can change at any minute as its not a set amount.
The current price of Ethereum is $1,220 per ETH.
Platforms utilise ETH as the main currency as NFTs are put on the ethereum blockchain with collectors using this as their currency to exchange for art backed by NFTs. You can transfer ETH using the top exchanges such as Coinbase or Binance to your bank account or PayPal.
Even if you read to the bottom, it will be hard to understand straight away as its a lot of information at once. I speak about the ins and outs on this newsletter and all you have to do is sign-up if you want to learn more about the space; an email will be sent straight to you!
If this did help you understand the concept of NFTs, share the post to your friends so they can join you in this journey.