a dedicated section</strong></a> for this particular wallet, but in short, it&rsquo;s one of the most popular Ethereum and ERC token wallets on the market, and it&rsquo;ll make Ethereum-based NFT storage a breeze.</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"How to trade NFTs: Selling/buying.\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/optimized/hot_to_trade_nfts_01.jpg/" alt=\"How to trade NFTs: Selling/buying.\" width=\"1000\" height=\"541\" /></p>\n<p>Moving on, the next big thing that you need to take care of is the actual crypto that you&rsquo;ll use to purchase your initial NFTs. In other words, if you&rsquo;re starting completely fresh, and don&rsquo;t have any assets to your name, <strong>you&rsquo;ll need to buy some cryptocurrency</strong> (specifically - <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/buy-ethereum-eth/">Ether) in order to then trade it for your very first NFT. Some marketplaces support credit and debit cards, but if you want complete privacy and anonymity, you&rsquo;ll need to stick to the crypto route.</p>\n<p>This process can sound really intimidating, but let me assure you - it&rsquo;s really nothing to be worried about! These days, popular cryptocurrency exchange platforms are extremely good at onboarding newbies, and guiding them through their initial purchases. With the best-known exchanges, such as <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/goon/binance/" target=\"_blank\" rel=\"nofollow noindex noopener\"><strong>Binance</strong></a> or <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/goon/kraken/" target=\"_blank\" rel=\"nofollow noindex noopener\"><strong>Kraken</strong></a>, you&rsquo;ll be able to register and buy crypto with a credit or debit card in no time!</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"How to trade NFTs: Buying some crypto.\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/optimized/hot_to_trade_nfts_02.jpg/" alt=\"How to trade NFTs: Buying some crypto.\" width=\"1000\" height=\"551\" /></p>\n<p>If you&rsquo;d like to check out a more thorough explanation of how to buy cryptocurrency for the very first time, <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/learn/how-to-buy-crypto/">read this section</strong></a> &ndash; it covers the process in-depth. Granted that this section is about how to buy and sell NFTs for profit, I&rsquo;ll assume that you already have your wallet ready, and with some crypto transferred to it, too.</p>\n<p>The final point of preparation has to do with <strong>choosing the best NFT marketplace</strong>, where you&rsquo;d perform all of your trades on. Admittedly, the variety of available options is getting bigger, by the day, but if you want to err on the side of caution, your best bet would still be using <strong>OpenSea</strong>. It&rsquo;s considered by many to be the best NFT marketplace out there, offering its users access to an unprecedented number of different non-fungible tokens, and a way of how to trade NFTs safely.</p>\n<h2>Making Your First Trade</h2>\n<p>So - with all of the big preparation steps out of the way, you are finally ready to learn how to trade NFTs! But a single question remains - <strong>what NFT should you buy, as your very first one?</strong></p>\n<p>Now, truth be told, this is a discussion for the ages. Everyone is going to have their own opinions about which non-fungible tokens are <em>&ldquo;worth it&rdquo;</em>, and which will tank, price-wise.</p>\n<p>Depending on when it is that you&rsquo;re reading this section, the NFT boom might be at its peak, or we might currently be in an &ldquo;NFT winter&rdquo;. This is a huge factor to consider, as well - as history has shown, many NFTs tend to lose a lot of their initial value, when the bear market comes!</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"How to trade NFTs: Find a worthy NFT.\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/optimized/hot_to_trade_nfts_03.jpg/" alt=\"How to trade NFTs: Find a worthy NFT.\" width=\"1000\" height=\"537\" /></p>\n<p><strong>Your best bet would be to set up a price range, and then look for an NFT project that has some sort of backing behind it</strong>. This can be anything - a collection of paintings with free tickets to a concert, each, a piece of digital artwork from a band, containing a link to their new, Metaverse-exclusive album, photos of cars from a famous car brand, each coming with exclusive benefits to the holder, and so on.</p>\n<p>No one can say for sure, which projects will blow up, and which will tank in price! However, if you follow the market trends, and educate yourself about the industry, as a whole, you could catch some hidden gems, every once in a while!</p>\n<p>Let&rsquo;s say that you&rsquo;ve found that one, single NFT that you absolutely love, and think that it&rsquo;s going to appreciate in price, as time goes on. <strong>How do you get it into your digital wallet?</strong></p>\n<p>Well, if you&rsquo;re using OpenSea and MetaMask, this process is going to be super simple.</p>\n<p>First, you need to<strong> connect your wallet to OpenSea</strong>. This can be done at the top-right corner of the screen, on the OpenSea homepage - simply choose to connect via MetaMask, pass a few verifications, and you&rsquo;re in!</p>\n<p>Next, you&rsquo;ll need to <strong>find the NFT that you&rsquo;ve picked, and either add it to your basket, or buy it instantly</strong>. When you navigate to your basket, you&rsquo;ll be able to view all of the necessary details to complete your transaction - creator fees, payment types, total price, and so on.</p>\n<p>If everything seems to be in order, you can complete your payment - if you&rsquo;re using crypto, and have enough coins in your wallet, you&rsquo;ll receive a few transaction confirmations, and in a few seconds, your MetaMask wallet will be credited with your newly-acquired non-fungible token. Congratulations on your new purchase!</p>\n<h2>Trading Your NFTs</h2>\n<p>Now that you&rsquo;ve dipped your toes into the world of NFT ownership, you can finally start trading these assets. There are multiple ways of how you can approach the topic, as well!</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"How to trade NFTs: Trading it for tokens or other NFTs.\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/optimized/hot_to_trade_nfts_04.jpg/" alt=\"How to trade NFTs: Trading it for tokens or other NFTs.\" width=\"1000\" height=\"446\" /></p>\n<p>Think of it like trading candy. You could sell the candy at a physical store, online, or trade it for some other goods, as well. NFTs aren&rsquo;t any different, in that regard!</p>\n<p>The simplest way of how to trade NFTs is to<strong> sell your current NFT for a profit, and purchase another token (or, even, tokens!) in its place</strong>. While it&rsquo;s not technically<em> &ldquo;trading&rdquo;</em>, per se, you are still exchanging NFTs, albeit indirectly.</p>\n<p>The best part? This can be done on the same marketplace that you&rsquo;ve bought your original NFT on. Meaning, you don&rsquo;t need to over-encumber yourself with the management of a huge list of different trading platforms.</p>\n<p>Alternatively, you could participate in <em>actual</em> NFT trading, as well - in other words, <strong>you could exchange your NFT for another one, in a mutually agreed-upon trade with another person</strong>.</p>\n<p>Is this something I&rsquo;d recommend doing? Well, not really, no. These types of trades involve a lot of trust, and are usually very complex when it comes to determining whether or not they&rsquo;re actually beneficial. <strong>For the most part, I&rsquo;d stick to the time-tested buying and selling processes!</strong></p>\n<p>The one piece of good news, however, is that there seems to be an influx of marketplaces that make trading NFTs much simpler. These platforms act as middlemen, and facilitate a trade between two parties - you, and another person that you&rsquo;re trading with. So, it&rsquo;s definitely something worth keeping in mind, if you do decide to go the trading route!</p>\n<h2>Extra Safety for Your NFTs</h2>\n<p>Now that you know how to buy and sell NFTs for profit, and are ready to jump into this exciting realm, there&rsquo;s one more point that I&rsquo;d like to stress.</p>\n<p>Above in this section, I've mentioned MetaMask, and how it&rsquo;s the best wallet to use for all of your NFT trading ventures. While that is true, convenience-wise, <strong>MetaMask is still considered to be a hot wallet - one that maintains a constant connection to the internet</strong>.</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"How to trade NFTs: Extra safety for your NFTs.\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/optimized/hot_to_trade_nfts_05.jpg/" alt=\"How to trade NFTs: Extra safety for your NFTs.\" width=\"1000\" height=\"749\" /></p>\n<p>Assuming that you&rsquo;ll find success in your non-fungible token trading ventures, and grow your portfolio, eventually, you might start worrying about the safety of your assets. While MetaMask has a decent reputation, security-wise, there&rsquo;s still a lot of room for improvement - this is where <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/learn/crypto-terms/what-is-hardware-wallet/">hardware wallets</strong></a> come in.</p>\n<p>Hardware wallets are often considered to be among the safest crypto storage options in the industry. Combine that with the fact that you can actually connect your MetaMask wallet with one of the most popular hardware storage devices on the market - <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/goon/ledger/" target=\"_blank\" rel=\"nofollow noindex noopener\"><strong>the Ledger wallet</strong></a> -, and you have yourself a pretty strong case for security and asset protection!</p>\n<p>That's about it, for now. I leave you with the knowledge of both how to trade NFTs, for the very first time, as well as concerning all of the prerequisites that you need to be aware of before you can actually start trading.</p>","meta_title":"How to Trade NFTs? The Key Things You Need to Know","meta_description":"You have non-fungible tokens and now the main question in your head is \"How to trade NFTs?\" Don't worry, you'll find all answers right here.","meta_keywords":"how to trade nfts, how to trade nfts on opensea, how to trade nfts safely, how to sell nfts for free, how to buy and sell nfts for profit, how to sell nfts without gas fees, how do you make nfts to sell","order":2,"language":"en","created_at":"2023-01-17T13:42:49.000000Z","updated_at":"2023-02-27T12:07:39.000000Z","modified_content":"<p>In this section, I&rsquo;m going to tell you <strong>how to trade NFTs on <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/goon/opensea/" target=\"_blank\" rel=\"nofollow noindex noopener\">OpenSea</a></strong>, in the simplest way possible!</p>\n<p>NFTs are undeniably a huge part of the crypto space. While their popularity is very volatile, there are new projects coming out within the space, seemingly every day, still! Many crypto enthusiasts will tell you that non-fungible tokens are still a great way to make money with crypto!</p>\n<p>You&rsquo;ve heard about NFTs, love the idea behind them, and are now eager to make money this way, too. However, you&rsquo;re new to crypto, and have no idea where to even start. If that&rsquo;s the case - don&rsquo;t fret, since that&rsquo;s what I&rsquo;m here to help you with!</p>\n<p><strong>In this section, we&rsquo;re going to talk about NFT trading</strong>. Specifically, I&rsquo;ll tell you about all of the prerequisites that you need to keep in mind before you actually start trading, as well as walk you through the process of performing your very first NFT trade, too!</p>\n<p><em>Let&rsquo;s get to it!</em></p>\n<div class=\"container\">\n <div class=\"row justify-content-center\">\n <div class=\"col-md-10 comparison-suggestion pb-3 mb-4\">\n <div class=\"d-flex flex-row\">\n <div class=\"text-center\">\n <div class=\"img-block-yt\">\n <img src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/assets/images/compare-crypto-exchanges.gif/"/n alt=\"How to Trade NFTs Safely? (Animated Explainer For Beginners)\"\n title=\"How to Trade NFTs Safely? (Animated Explainer For Beginners)\" class=\"border-0\">\n <p>Video Explainer</p>\n </div>\n </div>\n <div class=\"col-xs-10 col-sm-10 col-md-10 text-left py-3 yt-info\">\n <h4 class=\"mb-1\">Video Explainer: NFT Trading: The Ins and Outs</h4>\n <p class=\"py-1 mb-0 youtube-video-subtitle\">Reading is not your thing? Watch the \"NFT Trading: The Ins and Outs\" video explainer</p>\n </div>\n </div>\n <div class=\"row justify-content-center text-center\">\n <div class=\"col-12 col-md-11 px-3\">\n <div class=\"wrapper mb-0\">\n <div class=\"youtube mb-4 bg-transparent p-0 video-modal-popup\" data-toggle=\"modal\"\n data-target=\"#video-modal\" data-id=\"zxx-yQr9YpU\" data-title=\"CryptoFinallyExplained\">\n <div class=\"video-gradient-top\"></div>\n <p class=\"text-left dyk-video-title\">How to Trade NFTs Safely? (Animated Explainer For Beginners)</p>\n <img src=https://www.bitdegree.org/"https://i.ytimg.com/vi/zxx-yQr9YpU/hq720.jpg/"/n alt=\"How to Trade NFTs Safely? (Animated Explainer For Beginners)\"\n title=\"How to Trade NFTs Safely? (Animated Explainer For Beginners)\"\n class=\"p-0\">\n <img class=\"play-button\" data-target=\"#video-modal\"\n src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/assets/video-button.png/"/n alt=\"How to Trade NFTs Safely? (Animated Explainer For Beginners)\">\n </div>\n </div>\n </div>\n </div>\n <div class=\"row justify-content-center text-center\">\n <div>\n <a href=https://www.bitdegree.org/"https://www.youtube.com/c/CryptoFinallyExplained?sub_confirmation=1\%22\n class=\"btn yt-promo mb-2\" target=\"_blank\" rel=\"nofollow noopener\">\n <div class=\"row justify-content-center align-items-center mx-0 text-center\">\n <div class=\"col-4 col-md-4\">\n <i class=\"fab fa-youtube yt-dyk-btn\"></i>\n </div>\n <div class=\"col-8 col-md-8 text-center yt-promo-text\">\n <h4 class=\"m-0 text-white\">SUBSCRIBE</h4>\n <span>ON YOUTUBE</span>\n </div>\n </div>\n </a>\n </div>\n </div>\n </div>\n </div>\n</div>\n<div class=\"modal fade\" id=\"video-modal\" tabindex=\"-1\" role=\"dialog\" aria-labelledby=\"zxx-yQr9YpU\">\n <div class=\"modal-dialog modal-dialog-centered modal-lg\" role=\"document\">\n <div class=\"modal-content\">\n <div class=\"modal-body p-0\">\n <button type=\"button\" class=\"video-modal-close close\" data-dismiss=\"modal\" aria-label=\"Close\">\n <i aria-hidden=\"true\" class=\"fas fa-times\"></i>\n </button>\n <div id=\"iframe\"></div>\n </div>\n <a class=\"text-decoration-none\"\n href=https://www.bitdegree.org/"https://www.youtube.com/c/CryptoFinallyExplained?sub_confirmation=1\%22\n rel=\"nofollow noopener\" target=\"_blank\">\n <div class=\"modal-footer p-0 d-block bg-white\">\n <div class=\"row justify-content-center m-0\">\n <div class=\"col-3 col-md-4 col-lg-2 p-0\">\n <img class=\"w-100 h-100\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/assets/crypto-subscribe.jpg/" alt=\"Subscribe\">\n </div>\n <div class=\"col-9 col-md-8 col-lg-2 px-0 d-flex\">\n <div class=\"modal-subscribe w-100\">\n <p class=\"m-0 mt-1 mr-3\">SUBSCRIBE<br>\n <span class=\"m-0\">ON YOUTUBE</span>\n </p>\n </div>\n </div>\n <div class=\"col-12 col-md-12 col-lg-8 p-0 text-center d-flex justify-content-center align-items-center\">\n <div class=\"modal-subscribe-text\">\n <h4 class=\"m-0\">Understand crypto with ease</h4>\n <span>New explainer videos every week!</span>\n </div>\n </div>\n </div>\n </div>\n </a>\n </div>\n </div>\n</div>\n<h2>Before You Start</h2>\n<p>Now, while jumping into NFT trading can be a super-exciting prospect, you need to contain your excitement a tad bit longer, while we talk about a few prerequisites that you&rsquo;ll need to sort out. After all, if you want to maximize your chances of success in trading NFTs, you need to come in with your homework prepared!</p>\n<p><strong>The very first thing that you&rsquo;ll need to do is create a hot cryptocurrency wallet</strong>. You will use this wallet to store your NFTs, as well as perform all of the transactions in the future. If you decide to study how to make NFTs to sell, this wallet will be needed, as well!</p>\n<p>There are plenty of different wallets that you can pick, but I&rsquo;d personally go with <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/goon/metamask/" target=\"_blank\" rel=\"nofollow noindex noopener\"><strong>MetaMask</strong></a>. You can read <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/learn/what-is-metamask/">a dedicated section</strong></a> for this particular wallet, but in short, it&rsquo;s one of the most popular Ethereum and ERC token wallets on the market, and it&rsquo;ll make Ethereum-based NFT storage a breeze.</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"How to trade NFTs: Selling/buying.\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/optimized/hot_to_trade_nfts_01.jpg/" alt=\"How to trade NFTs: Selling/buying.\" width=\"1000\" height=\"541\" /></p>\n<p>Moving on, the next big thing that you need to take care of is the actual crypto that you&rsquo;ll use to purchase your initial NFTs. In other words, if you&rsquo;re starting completely fresh, and don&rsquo;t have any assets to your name, <strong>you&rsquo;ll need to buy some cryptocurrency</strong> (specifically - <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/buy-ethereum-eth/">Ether) in order to then trade it for your very first NFT. Some marketplaces support credit and debit cards, but if you want complete privacy and anonymity, you&rsquo;ll need to stick to the crypto route.</p>\n<p>This process can sound really intimidating, but let me assure you - it&rsquo;s really nothing to be worried about! These days, popular cryptocurrency exchange platforms are extremely good at onboarding newbies, and guiding them through their initial purchases. With the best-known exchanges, such as <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/goon/binance/" target=\"_blank\" rel=\"nofollow noindex noopener\"><strong>Binance</strong></a> or <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/goon/kraken/" target=\"_blank\" rel=\"nofollow noindex noopener\"><strong>Kraken</strong></a>, you&rsquo;ll be able to register and buy crypto with a credit or debit card in no time!</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"How to trade NFTs: Buying some crypto.\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/optimized/hot_to_trade_nfts_02.jpg/" alt=\"How to trade NFTs: Buying some crypto.\" width=\"1000\" height=\"551\" /></p>\n<p>If you&rsquo;d like to check out a more thorough explanation of how to buy cryptocurrency for the very first time, <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/learn/how-to-buy-crypto/">read this section</strong></a> &ndash; it covers the process in-depth. Granted that this section is about how to buy and sell NFTs for profit, I&rsquo;ll assume that you already have your wallet ready, and with some crypto transferred to it, too.</p>\n<p>The final point of preparation has to do with <strong>choosing the best NFT marketplace</strong>, where you&rsquo;d perform all of your trades on. Admittedly, the variety of available options is getting bigger, by the day, but if you want to err on the side of caution, your best bet would still be using <strong>OpenSea</strong>. It&rsquo;s considered by many to be the best NFT marketplace out there, offering its users access to an unprecedented number of different non-fungible tokens, and a way of how to trade NFTs safely.</p>\n<h2>Making Your First Trade</h2>\n<p>So - with all of the big preparation steps out of the way, you are finally ready to learn how to trade NFTs! But a single question remains - <strong>what NFT should you buy, as your very first one?</strong></p>\n<p>Now, truth be told, this is a discussion for the ages. Everyone is going to have their own opinions about which non-fungible tokens are <em>&ldquo;worth it&rdquo;</em>, and which will tank, price-wise.</p>\n<p>Depending on when it is that you&rsquo;re reading this section, the NFT boom might be at its peak, or we might currently be in an &ldquo;NFT winter&rdquo;. This is a huge factor to consider, as well - as history has shown, many NFTs tend to lose a lot of their initial value, when the bear market comes!</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"How to trade NFTs: Find a worthy NFT.\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/optimized/hot_to_trade_nfts_03.jpg/" alt=\"How to trade NFTs: Find a worthy NFT.\" width=\"1000\" height=\"537\" /></p>\n<p><strong>Your best bet would be to set up a price range, and then look for an NFT project that has some sort of backing behind it</strong>. This can be anything - a collection of paintings with free tickets to a concert, each, a piece of digital artwork from a band, containing a link to their new, Metaverse-exclusive album, photos of cars from a famous car brand, each coming with exclusive benefits to the holder, and so on.</p>\n<p>No one can say for sure, which projects will blow up, and which will tank in price! However, if you follow the market trends, and educate yourself about the industry, as a whole, you could catch some hidden gems, every once in a while!</p>\n<p>Let&rsquo;s say that you&rsquo;ve found that one, single NFT that you absolutely love, and think that it&rsquo;s going to appreciate in price, as time goes on. <strong>How do you get it into your digital wallet?</strong></p>\n<p>Well, if you&rsquo;re using OpenSea and MetaMask, this process is going to be super simple.</p>\n<p>First, you need to<strong> connect your wallet to OpenSea</strong>. This can be done at the top-right corner of the screen, on the OpenSea homepage - simply choose to connect via MetaMask, pass a few verifications, and you&rsquo;re in!</p>\n<p>Next, you&rsquo;ll need to <strong>find the NFT that you&rsquo;ve picked, and either add it to your basket, or buy it instantly</strong>. When you navigate to your basket, you&rsquo;ll be able to view all of the necessary details to complete your transaction - creator fees, payment types, total price, and so on.</p>\n<p>If everything seems to be in order, you can complete your payment - if you&rsquo;re using crypto, and have enough coins in your wallet, you&rsquo;ll receive a few transaction confirmations, and in a few seconds, your MetaMask wallet will be credited with your newly-acquired non-fungible token. Congratulations on your new purchase!</p>\n<h2>Trading Your NFTs</h2>\n<p>Now that you&rsquo;ve dipped your toes into the world of NFT ownership, you can finally start trading these assets. There are multiple ways of how you can approach the topic, as well!</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"How to trade NFTs: Trading it for tokens or other NFTs.\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/optimized/hot_to_trade_nfts_04.jpg/" alt=\"How to trade NFTs: Trading it for tokens or other NFTs.\" width=\"1000\" height=\"446\" /></p>\n<p>Think of it like trading candy. You could sell the candy at a physical store, online, or trade it for some other goods, as well. NFTs aren&rsquo;t any different, in that regard!</p>\n<p>The simplest way of how to trade NFTs is to<strong> sell your current NFT for a profit, and purchase another token (or, even, tokens!) in its place</strong>. While it&rsquo;s not technically<em> &ldquo;trading&rdquo;</em>, per se, you are still exchanging NFTs, albeit indirectly.</p>\n<p>The best part? This can be done on the same marketplace that you&rsquo;ve bought your original NFT on. Meaning, you don&rsquo;t need to over-encumber yourself with the management of a huge list of different trading platforms.</p>\n<p>Alternatively, you could participate in <em>actual</em> NFT trading, as well - in other words, <strong>you could exchange your NFT for another one, in a mutually agreed-upon trade with another person</strong>.</p>\n<p>Is this something I&rsquo;d recommend doing? Well, not really, no. These types of trades involve a lot of trust, and are usually very complex when it comes to determining whether or not they&rsquo;re actually beneficial. <strong>For the most part, I&rsquo;d stick to the time-tested buying and selling processes!</strong></p>\n<p>The one piece of good news, however, is that there seems to be an influx of marketplaces that make trading NFTs much simpler. These platforms act as middlemen, and facilitate a trade between two parties - you, and another person that you&rsquo;re trading with. So, it&rsquo;s definitely something worth keeping in mind, if you do decide to go the trading route!</p>\n<h2>Extra Safety for Your NFTs</h2>\n<p>Now that you know how to buy and sell NFTs for profit, and are ready to jump into this exciting realm, there&rsquo;s one more point that I&rsquo;d like to stress.</p>\n<p>Above in this section, I've mentioned MetaMask, and how it&rsquo;s the best wallet to use for all of your NFT trading ventures. While that is true, convenience-wise, <strong>MetaMask is still considered to be a hot wallet - one that maintains a constant connection to the internet</strong>.</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"How to trade NFTs: Extra safety for your NFTs.\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/optimized/hot_to_trade_nfts_05.jpg/" alt=\"How to trade NFTs: Extra safety for your NFTs.\" width=\"1000\" height=\"749\" /></p>\n<p>Assuming that you&rsquo;ll find success in your non-fungible token trading ventures, and grow your portfolio, eventually, you might start worrying about the safety of your assets. While MetaMask has a decent reputation, security-wise, there&rsquo;s still a lot of room for improvement - this is where <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/learn/crypto-terms/what-is-hardware-wallet/">hardware wallets</strong></a> come in.</p>\n<p>Hardware wallets are often considered to be among the safest crypto storage options in the industry. Combine that with the fact that you can actually connect your MetaMask wallet with one of the most popular hardware storage devices on the market - <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/goon/ledger/" target=\"_blank\" rel=\"nofollow noindex noopener\"><strong>the Ledger wallet</strong></a> -, and you have yourself a pretty strong case for security and asset protection!</p>\n<p>That's about it, for now. I leave you with the knowledge of both how to trade NFTs, for the very first time, as well as concerning all of the prerequisites that you need to be aware of before you can actually start trading.</p>","preview_url":"https://www.bitdegree.org/crypto/learn/how-to-trade-nfts","youtube_video":{"id":137,"channel_id":1,"sort":13,"video_title":"How to Trade NFTs Safely? (Animated Explainer For Beginners)","description":"How to trade NFTs on OpenSea for the very first time?\n\nLove ‘em or hate ‘em, one thing’s for sure - NFTs have definitely become a huge part of the larger crypto ecosystem. While the space is still very volatile, it does attract a lot of attention, from both crypto newbies and veterans, alike!\n\nIn this video, I will tell you how to trade NFTs, or how to buy and sell NFTs for a profit. We’ll talk about the key points that you’ll need to figure out before you start trading, and after that, I will walk you through the process of buying and trading your very first NFT!\n\nHave you ever traded NFTs before? If so, how did you do it? Share your experiences in the comments below!\n\nVideo Time Table:\n\n0:00 Introduction to How to Trade NFTs\n1:00 How to Prepare for NFT Trading\n3:09 Making Your First Trade\n5:16 Trading Your NFTs\n6:41 Extra Safety For Your NFTs\n7:45 Wrap-up: How to Trade NFTs?\n\nGet Quick Crypto Tips on Twitter - Follow:\nhttps://twitter.com/crypto_xplained\n\n#HowToTradeNfts #HowToTradeNftsOnOpensea #HowToTradeNftsSafely","video_id":"zxx-yQr9YpU","duration":493,"view_count":176,"thumbnail_url":"https://i.ytimg.com/vi/zxx-yQr9YpU/hq720.jpg","thumbnail_width":1280,"thumbnail_height":720,"published_at":"2023-02-09 20:02:37","created_at":"2023-02-09T23:00:04.000000Z","updated_at":"2023-05-21T23:00:04.000000Z","channel":{"id":1,"title":"CryptoFinallyExplained","channel_id":"UCOryUY0yxC08eJtK23mNgiA","main_playlist_id":"UUOryUY0yxC08eJtK23mNgiA"}}},"prevSection":{"id":424,"featured_image_id":9338,"original_id":null,"youtube_video_id":136,"author_id":42,"translator_id":null,"chapter_id":4,"title":"The Key Crypto Wallet Safety Practices: How Safe Can Crypto Be?","slug":"how-safe-is-cryptocurrency","definition":"Did you know that being more attentive and cautious is one of the main ways to boost your safety in the crypto world?","status":"published","content":"<p>In this section, we&rsquo;re going to talk about <strong>how safe is cryptocurrency</strong>, as well as some of the best crypto wallet safety practices that everyone should be following!</p>\n<p>Imagine that you&rsquo;ve bought the safest wallet on the planet. It has multiple locks attached to it, and even a digital display requiring your fingerprint in order for it to open. You store all of your money within the wallet, and walk around feeling very safe about your cash.</p>\n<p>However, one day, while you weren&rsquo;t looking, someone grabs your wallet from the table where you left it on. Even though it might have been the safest wallet in the world, it still got stolen - in order to avoid something like this happening in the real world, to your crypto assets, you need to be aware of some of <strong>the best crypto wallet safety practices</strong>!</p>\n<p>In this section, we&rsquo;re going to look at how safe is cryptocurrency, as well as some of the most important crypto wallet safety and security practices that you should be aware of, when you&rsquo;re just starting out with crypto. I&rsquo;ll reveal the top tips for keeping your crypto safe, and then elaborate on how you can use them yourself, no matter what type of wallet you might have.</p>\n<p><em>So, let&rsquo;s get to it!</em></p>\n<h2>Don&rsquo;t Tell Anyone About Your Crypto</h2>\n<p>Now, keep in mind that a lot of the best <strong>crypto wallet safety practices covered in this section are going to be applicable to both hot wallets, as well as cold storage devices.</strong></p>\n<p>If you have no idea what are hot or cold crypto wallets, please make sure to read the <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/learn/hot-wallet-vs-cold-wallet/">section dedicated to this topic</strong></a>. It&rsquo;ll help you get a much better understanding of how to keep your wallets safe!</p>\n<p>So, now - is it safe to invest in cryptocurrency, and just how safe are cryptocurrencies, in general? Well, the answer really depends on whether or not you follow all of the &ldquo;best safety practices&rdquo;!</p>\n<p>The first safety practice is rather simple - <strong>you should never tell anyone about owning crypto, or about the wallets that you use</strong>.</p>\n<p>Why is that the case? Let's expand on the earlier example.</p>\n<p>Imagine that, with your super-secret wallet in hand, you went to a coffee shop to meet a friend, and ordered a cup of coffee. Excited about your new wallet, you start telling your friend all about how secure it is, and how you now keep all of your money inside of it. A stranger sitting nearby overhears your conversation, and takes an interest in what you&rsquo;re saying.</p>\n<p>The first opportunity they get, when you&rsquo;re not looking, they grab your wallet, and run off with it. Perhaps if you wouldn&rsquo;t have boasted about that item, it would still be in your possession, and you wouldn&rsquo;t need to ask yourself - is crypto safe?</p>\n<p>Cryptocurrency wallets work the exact same way, really. With <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/learn/crypto-terms/what-is-hardware-wallet/">hardware wallets</strong></a>, this is self-explanatory - they are actual physical items that can be stolen. The same, though, is true with <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/learn/crypto-terms/what-is-hot-wallet/">hot wallets</strong></a>, as well.</p>\n<p>If you go around boasting about your crypto portfolio, telling everyone where you keep all of your assets, you risk becoming a target to some less-than-honorable individuals. The saying <em>&ldquo;money loves silence&rdquo;</em> is very accurate, in this regard - you can probably see why that&rsquo;s the case, as well!</p>\n<h2>Store Your Recovery Phrase Somewhere Safe</h2>\n<p>Moving on, note that there&rsquo;s actually something even more important than your crypto wallet, cryptocurrency storage-wise. Something that is essential to know about, when you&rsquo;re wondering &ldquo;how safe is cryptocurrency?&rdquo;. That would be the <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/learn/crypto-terms/what-is-recovery-seed/">wallet recovery phrase</strong></a>.</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"How safe is cryptocurrency: Recovery phrase.\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/optimized/crypto_wallet_safety_practices_01.jpg/" alt=\"How safe is cryptocurrency: Recovery phrase.\" width=\"1000\" height=\"384\" /></p>\n<p>Whenever you set up a crypto wallet for the first time, you are given a string of randomly generated words &ndash; usually 12 or 24. <strong>These words, in that exact order, are your wallet recovery phrase</strong>. If your wallet got lost, stolen, or if you forgot your password, you would use this phrase to recover your funds to a new wallet.</p>\n<p>Now, as you can probably guess, this works the other way around, too. So, if someone were to steal your wallet recovery phrase, they would essentially be able to <em>&ldquo;recover&rdquo;</em> (i.e., steal) all of your wallet&rsquo;s contents. Needless to say, that&rsquo;s a really scary scenario!</p>\n<p>This is why it&rsquo;s absolutely crucial that you keep your wallet recovery phrase in the safest possible place you can think of. Since it&rsquo;s something that you&rsquo;d only need to use in an emergency, you can store it somewhere remote, like a safe. On top of that, <strong>NEVER tell anyone where it is</strong> - that&rsquo;s very important!</p>\n<h2>Avoid Clicking Weird Links on the Internet</h2>\n<p>The next &ldquo;best crypto wallet safety practice&rdquo; is mainly applicable to hot wallet owners. It has to do with <strong>all of those weird links that you see in your email, on various websites, or in your chat box</strong>. This includes a message that you&rsquo;ve received from a friend, telling you to <em>\"check out</em> <em>this awesome photo on this definitely-not-suspicious website&rdquo;.</em></p>\n<p><em><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"How safe is cryptocurrency: Weird links.\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/optimized/crypto_wallet_safety_practices_02.jpg/" alt=\"How safe is cryptocurrency: Weird links.\" width=\"1000\" height=\"309\" /></em></p>\n<p>You know the drill by now - links with viruses and keyloggers are something that we&rsquo;ve all encountered, at least once in our lives. Some of them are very obvious, but others can be super-malicious, as well as difficult to spot.</p>\n<p>Well, if you&rsquo;re not careful, and accidentally download a virus by clicking on one of such links, you might set in motion a sequence of events that&rsquo;ll lead to your wallet being emptied. It doesn&rsquo;t necessarily have to be related to questions such as is staking crypto safe, or is accessing a specific dApp secure - these hacks can happen in crypto-unrelated ways, as well!</p>\n<p><strong>The best-case scenario is to have a separate device</strong>, altogether. You would only use this device to log into your crypto exchange account, trade, and use your wallet to perform transactions - that&rsquo;s it. Assuming that the device is brand new, and hasn&rsquo;t been compromised before, this would lower the chance of you catching a virus significantly.</p>\n<p>Naturally, not that many people are going to take this route. Instead, if you use but a single device for all of your internet browsing and crypto trading wants and needs, do put in the conscious effort to <strong>avoid any suspicious websites and more-than-shady links</strong>.</p>\n<h2>Don&rsquo;t Carry Your Wallet Around With You</h2>\n<p>As opposed to all of that, let&rsquo;s now take a look at a safety practice that&rsquo;s mostly relevant to cold, or hardware wallet owners - <strong>never carry your wallet around with you, if you won&rsquo;t need it</strong>.</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"How safe is cryptocurrency: Cold wallet.\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/optimized/crypto_wallet_safety_practices_03.jpg/" alt=\"How safe is cryptocurrency: Cold wallet.\" width=\"1000\" height=\"760\" /></p>\n<p>Though this is something that you&rsquo;ve probably figured out already - thieves and malicious individuals are always looking for people who are not careful with their belongings. Cryptocurrency wallet devices are definitely not an exception. Instead, quite the opposite is true, really - they attract attention, due to the fact that they look interesting and futuristic. Even wallets that are designed to look like everyday items are still somewhat unusual - that&rsquo;s both a good thing, and a bad thing, really!</p>\n<p>In other words, <strong>your hardware wallet should remain in a safe and secure place, at all times</strong>. Usually, there&rsquo;s absolutely no need to bring it with you to a date, a meetup with friends, or to the local grocery store. Everyone learning about how safe is cryptocurrency should know this very well!</p>\n<p>If you do accidentally take your wallet with you and notice only after you leave the house - keep it in your pocket, and don&rsquo;t tell anyone! Otherwise, you might end up being the main character of the situation I described at the beginning of this section!</p>\n<h2>Be Careful With Your Transactions</h2>\n<p>Up to this point, we&rsquo;ve mostly talked about <em>&ldquo;external&rdquo;</em> factors - thieves stealing your wallet, keyloggers &amp; viruses, and so on. However, learning is cryptocurrency safe, you&rsquo;ll find out that wallet safety practices are applicable to the other side of the deal, as well.</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"How safe is cryptocurrency: Transactions.\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/optimized/crypto_wallet_safety_practices_04.jpg/" alt=\"How safe is cryptocurrency: Transactions.\" width=\"1000\" height=\"755\" /></p>\n<p>To be a bit more specific, <strong>you should always check the transactions that you&rsquo;re participating in</strong>, too. Never interact with strange applications that ask you for your wallet address, and never send your crypto to some shady third parties. With the crypto market evolving so fast, scams evolve, as well, and become more and more intricate and clever. The best way to avoid them is to remove yourself from a fishy situation, altogether.</p>\n<p>On the flip side, avoiding these types of situations can sometimes be tricky, I admit. This is where the second part of this crypto wallet safety practice comes in - <strong>diversifying your crypto storage options</strong>.</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"How safe is cryptocurrency: Crypto storage.\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/optimized/crypto_wallet_safety_practices_05.jpg/" alt=\"How safe is cryptocurrency: Crypto storage.\" width=\"1000\" height=\"529\" /></p>\n<p>Is it safe to buy crypto on <strong><a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/goon/robinhood-crypto/" target=\"_blank\" rel=\"nofollow noindex noopener\">Robinhood</a></strong>? Probably, but only if you use an external wallet. Is Gemini crypto safe? Perhaps, but far less safe if you keep your tokens on the exchange! Can I keep crypto on <strong><a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/goon/binance/" target=\"_blank\" rel=\"nofollow noindex noopener\">Binance</a></strong>, <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/goon/kraken/" target=\"_blank\" rel=\"nofollow noindex noopener\"><strong>Kraken</strong></a>, or any other exchange? Well&hellip;</p>\n<p>If you want to feel a bit more at ease about your portfolio, you should <strong>always have multiple wallets at your disposal</strong>, with at least one of them being a hardware device (due to their high-end security). This way, even if something were to go wrong, and one of your wallets got compromised, you wouldn&rsquo;t risk losing ALL of your assets.</p>\n<p>Of course, managing multiple wallets can be a daunting task. Nonetheless, it&rsquo;s certainly a practice that can save your crypto, especially if you have a large portfolio of different coins and tokens!</p>\n<h2>Wrapping Things Up</h2>\n<p>Those were some of the best crypto wallet safety practices that every beginner crypto enthusiast should be aware of, and utilize. Of course, there are many more different safety measures that you could take, in order to ensure the security of your crypto. However, if you employ the practices that were discussed in this section, you&rsquo;ll already be ahead of the curve, by a significant margin!</p>\n<p>So, how safe is cryptocurrency, and is it safe to invest in crypto, in the first place? It&rsquo;s clear that, if you follow all of the proper precautions, <strong>crypto can be relatively safe</strong>. Though it&rsquo;s important to always stay up-to-date and aware of what&rsquo;s happening in the industry!</p>","meta_title":"Is Cryptocurrency Safe? Effective Wallet Safety Practices","meta_description":"Do you want to invest in crypto but keep wondering how safe is cryptocurrency? Find everything about crypto wallet safety practices here!","meta_keywords":"how safe is cryptocurrency, is it safe to invest in cryptocurrency, is cryptocurrency safe, is crypto safe, crypto security, is staking crypto safe, is it safe to buy crypto on robinhood, is gemini crypto safe, keep crypto on coinbase","order":37,"language":"en","created_at":"2023-01-17T12:04:08.000000Z","updated_at":"2023-02-02T06:47:43.000000Z","modified_content":"<p>In this section, we&rsquo;re going to talk about <strong>how safe is cryptocurrency</strong>, as well as some of the best crypto wallet safety practices that everyone should be following!</p>\n<p>Imagine that you&rsquo;ve bought the safest wallet on the planet. It has multiple locks attached to it, and even a digital display requiring your fingerprint in order for it to open. You store all of your money within the wallet, and walk around feeling very safe about your cash.</p>\n<p>However, one day, while you weren&rsquo;t looking, someone grabs your wallet from the table where you left it on. Even though it might have been the safest wallet in the world, it still got stolen - in order to avoid something like this happening in the real world, to your crypto assets, you need to be aware of some of <strong>the best crypto wallet safety practices</strong>!</p>\n<p>In this section, we&rsquo;re going to look at how safe is cryptocurrency, as well as some of the most important crypto wallet safety and security practices that you should be aware of, when you&rsquo;re just starting out with crypto. I&rsquo;ll reveal the top tips for keeping your crypto safe, and then elaborate on how you can use them yourself, no matter what type of wallet you might have.</p>\n<p><em>So, let&rsquo;s get to it!</em></p>\n<div class=\"container\">\n <div class=\"row justify-content-center\">\n <div class=\"col-md-10 comparison-suggestion pb-3 mb-4\">\n <div class=\"d-flex flex-row\">\n <div class=\"text-center\">\n <div class=\"img-block-yt\">\n <img src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/assets/images/compare-crypto-exchanges.gif/"/n alt=\"Is Your Crypto Safe? (5 Best Crypto Security Practices Explained)\"\n title=\"Is Your Crypto Safe? (5 Best Crypto Security Practices Explained)\" class=\"border-0\">\n <p>Video Explainer</p>\n </div>\n </div>\n <div class=\"col-xs-10 col-sm-10 col-md-10 text-left py-3 yt-info\">\n <h4 class=\"mb-1\">Video Explainer: The Key Crypto Wallet Safety Practices: How Safe Can Crypto Be?</h4>\n <p class=\"py-1 mb-0 youtube-video-subtitle\">Reading is not your thing? Watch the \"The Key Crypto Wallet Safety Practices: How Safe Can Crypto Be?\" video explainer</p>\n </div>\n </div>\n <div class=\"row justify-content-center text-center\">\n <div class=\"col-12 col-md-11 px-3\">\n <div class=\"wrapper mb-0\">\n <div class=\"youtube mb-4 bg-transparent p-0 video-modal-popup\" data-toggle=\"modal\"\n data-target=\"#video-modal\" data-id=\"bN5XetWivGA\" data-title=\"CryptoFinallyExplained\">\n <div class=\"video-gradient-top\"></div>\n <p class=\"text-left dyk-video-title\">Is Your Crypto Safe? (5 Best Crypto Security Practices Explained)</p>\n <img src=https://www.bitdegree.org/"https://i.ytimg.com/vi/bN5XetWivGA/hq720.jpg/"/n alt=\"Is Your Crypto Safe? (5 Best Crypto Security Practices Explained)\"\n title=\"Is Your Crypto Safe? (5 Best Crypto Security Practices Explained)\"\n class=\"p-0\">\n <img class=\"play-button\" data-target=\"#video-modal\"\n src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/assets/video-button.png/"/n alt=\"Is Your Crypto Safe? (5 Best Crypto Security Practices Explained)\">\n </div>\n </div>\n </div>\n </div>\n <div class=\"row justify-content-center text-center\">\n <div>\n <a href=https://www.bitdegree.org/"https://www.youtube.com/c/CryptoFinallyExplained?sub_confirmation=1\%22\n class=\"btn yt-promo mb-2\" target=\"_blank\" rel=\"nofollow noopener\">\n <div class=\"row justify-content-center align-items-center mx-0 text-center\">\n <div class=\"col-4 col-md-4\">\n <i class=\"fab fa-youtube yt-dyk-btn\"></i>\n </div>\n <div class=\"col-8 col-md-8 text-center yt-promo-text\">\n <h4 class=\"m-0 text-white\">SUBSCRIBE</h4>\n <span>ON YOUTUBE</span>\n </div>\n </div>\n </a>\n </div>\n </div>\n </div>\n </div>\n</div>\n<div class=\"modal fade\" id=\"video-modal\" tabindex=\"-1\" role=\"dialog\" aria-labelledby=\"bN5XetWivGA\">\n <div class=\"modal-dialog modal-dialog-centered modal-lg\" role=\"document\">\n <div class=\"modal-content\">\n <div class=\"modal-body p-0\">\n <button type=\"button\" class=\"video-modal-close close\" data-dismiss=\"modal\" aria-label=\"Close\">\n <i aria-hidden=\"true\" class=\"fas fa-times\"></i>\n </button>\n <div id=\"iframe\"></div>\n </div>\n <a class=\"text-decoration-none\"\n href=https://www.bitdegree.org/"https://www.youtube.com/c/CryptoFinallyExplained?sub_confirmation=1\%22\n rel=\"nofollow noopener\" target=\"_blank\">\n <div class=\"modal-footer p-0 d-block bg-white\">\n <div class=\"row justify-content-center m-0\">\n <div class=\"col-3 col-md-4 col-lg-2 p-0\">\n <img class=\"w-100 h-100\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/assets/crypto-subscribe.jpg/" alt=\"Subscribe\">\n </div>\n <div class=\"col-9 col-md-8 col-lg-2 px-0 d-flex\">\n <div class=\"modal-subscribe w-100\">\n <p class=\"m-0 mt-1 mr-3\">SUBSCRIBE<br>\n <span class=\"m-0\">ON YOUTUBE</span>\n </p>\n </div>\n </div>\n <div class=\"col-12 col-md-12 col-lg-8 p-0 text-center d-flex justify-content-center align-items-center\">\n <div class=\"modal-subscribe-text\">\n <h4 class=\"m-0\">Understand crypto with ease</h4>\n <span>New explainer videos every week!</span>\n </div>\n </div>\n </div>\n </div>\n </a>\n </div>\n </div>\n</div>\n<h2>Don&rsquo;t Tell Anyone About Your Crypto</h2>\n<p>Now, keep in mind that a lot of the best <strong>crypto wallet safety practices covered in this section are going to be applicable to both hot wallets, as well as cold storage devices.</strong></p>\n<p>If you have no idea what are hot or cold crypto wallets, please make sure to read the <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/learn/hot-wallet-vs-cold-wallet/">section dedicated to this topic</strong></a>. It&rsquo;ll help you get a much better understanding of how to keep your wallets safe!</p>\n<p>So, now - is it safe to invest in cryptocurrency, and just how safe are cryptocurrencies, in general? Well, the answer really depends on whether or not you follow all of the &ldquo;best safety practices&rdquo;!</p>\n<p>The first safety practice is rather simple - <strong>you should never tell anyone about owning crypto, or about the wallets that you use</strong>.</p>\n<p>Why is that the case? Let's expand on the earlier example.</p>\n<p>Imagine that, with your super-secret wallet in hand, you went to a coffee shop to meet a friend, and ordered a cup of coffee. Excited about your new wallet, you start telling your friend all about how secure it is, and how you now keep all of your money inside of it. A stranger sitting nearby overhears your conversation, and takes an interest in what you&rsquo;re saying.</p>\n<p>The first opportunity they get, when you&rsquo;re not looking, they grab your wallet, and run off with it. Perhaps if you wouldn&rsquo;t have boasted about that item, it would still be in your possession, and you wouldn&rsquo;t need to ask yourself - is crypto safe?</p>\n<p>Cryptocurrency wallets work the exact same way, really. With <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/learn/crypto-terms/what-is-hardware-wallet/">hardware wallets</strong></a>, this is self-explanatory - they are actual physical items that can be stolen. The same, though, is true with <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/learn/crypto-terms/what-is-hot-wallet/">hot wallets</strong></a>, as well.</p>\n<p>If you go around boasting about your crypto portfolio, telling everyone where you keep all of your assets, you risk becoming a target to some less-than-honorable individuals. The saying <em>&ldquo;money loves silence&rdquo;</em> is very accurate, in this regard - you can probably see why that&rsquo;s the case, as well!</p>\n<h2>Store Your Recovery Phrase Somewhere Safe</h2>\n<p>Moving on, note that there&rsquo;s actually something even more important than your crypto wallet, cryptocurrency storage-wise. Something that is essential to know about, when you&rsquo;re wondering &ldquo;how safe is cryptocurrency?&rdquo;. That would be the <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/learn/crypto-terms/what-is-recovery-seed/">wallet recovery phrase</strong></a>.</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"How safe is cryptocurrency: Recovery phrase.\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/optimized/crypto_wallet_safety_practices_01.jpg/" alt=\"How safe is cryptocurrency: Recovery phrase.\" width=\"1000\" height=\"384\" /></p>\n<p>Whenever you set up a crypto wallet for the first time, you are given a string of randomly generated words &ndash; usually 12 or 24. <strong>These words, in that exact order, are your wallet recovery phrase</strong>. If your wallet got lost, stolen, or if you forgot your password, you would use this phrase to recover your funds to a new wallet.</p>\n<p>Now, as you can probably guess, this works the other way around, too. So, if someone were to steal your wallet recovery phrase, they would essentially be able to <em>&ldquo;recover&rdquo;</em> (i.e., steal) all of your wallet&rsquo;s contents. Needless to say, that&rsquo;s a really scary scenario!</p>\n<p>This is why it&rsquo;s absolutely crucial that you keep your wallet recovery phrase in the safest possible place you can think of. Since it&rsquo;s something that you&rsquo;d only need to use in an emergency, you can store it somewhere remote, like a safe. On top of that, <strong>NEVER tell anyone where it is</strong> - that&rsquo;s very important!</p>\n<h2>Avoid Clicking Weird Links on the Internet</h2>\n<p>The next &ldquo;best crypto wallet safety practice&rdquo; is mainly applicable to hot wallet owners. It has to do with <strong>all of those weird links that you see in your email, on various websites, or in your chat box</strong>. This includes a message that you&rsquo;ve received from a friend, telling you to <em>\"check out</em> <em>this awesome photo on this definitely-not-suspicious website&rdquo;.</em></p>\n<p><em><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"How safe is cryptocurrency: Weird links.\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/optimized/crypto_wallet_safety_practices_02.jpg/" alt=\"How safe is cryptocurrency: Weird links.\" width=\"1000\" height=\"309\" /></em></p>\n<p>You know the drill by now - links with viruses and keyloggers are something that we&rsquo;ve all encountered, at least once in our lives. Some of them are very obvious, but others can be super-malicious, as well as difficult to spot.</p>\n<p>Well, if you&rsquo;re not careful, and accidentally download a virus by clicking on one of such links, you might set in motion a sequence of events that&rsquo;ll lead to your wallet being emptied. It doesn&rsquo;t necessarily have to be related to questions such as is staking crypto safe, or is accessing a specific dApp secure - these hacks can happen in crypto-unrelated ways, as well!</p>\n<p><strong>The best-case scenario is to have a separate device</strong>, altogether. You would only use this device to log into your crypto exchange account, trade, and use your wallet to perform transactions - that&rsquo;s it. Assuming that the device is brand new, and hasn&rsquo;t been compromised before, this would lower the chance of you catching a virus significantly.</p>\n<p>Naturally, not that many people are going to take this route. Instead, if you use but a single device for all of your internet browsing and crypto trading wants and needs, do put in the conscious effort to <strong>avoid any suspicious websites and more-than-shady links</strong>.</p>\n<h2>Don&rsquo;t Carry Your Wallet Around With You</h2>\n<p>As opposed to all of that, let&rsquo;s now take a look at a safety practice that&rsquo;s mostly relevant to cold, or hardware wallet owners - <strong>never carry your wallet around with you, if you won&rsquo;t need it</strong>.</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"How safe is cryptocurrency: Cold wallet.\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/optimized/crypto_wallet_safety_practices_03.jpg/" alt=\"How safe is cryptocurrency: Cold wallet.\" width=\"1000\" height=\"760\" /></p>\n<p>Though this is something that you&rsquo;ve probably figured out already - thieves and malicious individuals are always looking for people who are not careful with their belongings. Cryptocurrency wallet devices are definitely not an exception. Instead, quite the opposite is true, really - they attract attention, due to the fact that they look interesting and futuristic. Even wallets that are designed to look like everyday items are still somewhat unusual - that&rsquo;s both a good thing, and a bad thing, really!</p>\n<p>In other words, <strong>your hardware wallet should remain in a safe and secure place, at all times</strong>. Usually, there&rsquo;s absolutely no need to bring it with you to a date, a meetup with friends, or to the local grocery store. Everyone learning about how safe is cryptocurrency should know this very well!</p>\n<p>If you do accidentally take your wallet with you and notice only after you leave the house - keep it in your pocket, and don&rsquo;t tell anyone! Otherwise, you might end up being the main character of the situation I described at the beginning of this section!</p>\n<h2>Be Careful With Your Transactions</h2>\n<p>Up to this point, we&rsquo;ve mostly talked about <em>&ldquo;external&rdquo;</em> factors - thieves stealing your wallet, keyloggers &amp; viruses, and so on. However, learning is cryptocurrency safe, you&rsquo;ll find out that wallet safety practices are applicable to the other side of the deal, as well.</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"How safe is cryptocurrency: Transactions.\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/optimized/crypto_wallet_safety_practices_04.jpg/" alt=\"How safe is cryptocurrency: Transactions.\" width=\"1000\" height=\"755\" /></p>\n<p>To be a bit more specific, <strong>you should always check the transactions that you&rsquo;re participating in</strong>, too. Never interact with strange applications that ask you for your wallet address, and never send your crypto to some shady third parties. With the crypto market evolving so fast, scams evolve, as well, and become more and more intricate and clever. The best way to avoid them is to remove yourself from a fishy situation, altogether.</p>\n<p>On the flip side, avoiding these types of situations can sometimes be tricky, I admit. This is where the second part of this crypto wallet safety practice comes in - <strong>diversifying your crypto storage options</strong>.</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"How safe is cryptocurrency: Crypto storage.\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/optimized/crypto_wallet_safety_practices_05.jpg/" alt=\"How safe is cryptocurrency: Crypto storage.\" width=\"1000\" height=\"529\" /></p>\n<p>Is it safe to buy crypto on <strong><a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/goon/robinhood-crypto/" target=\"_blank\" rel=\"nofollow noindex noopener\">Robinhood</a></strong>? Probably, but only if you use an external wallet. Is Gemini crypto safe? Perhaps, but far less safe if you keep your tokens on the exchange! Can I keep crypto on <strong><a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/goon/binance/" target=\"_blank\" rel=\"nofollow noindex noopener\">Binance</a></strong>, <a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/goon/kraken/" target=\"_blank\" rel=\"nofollow noindex noopener\"><strong>Kraken</strong></a>, or any other exchange? Well&hellip;</p>\n<p>If you want to feel a bit more at ease about your portfolio, you should <strong>always have multiple wallets at your disposal</strong>, with at least one of them being a hardware device (due to their high-end security). This way, even if something were to go wrong, and one of your wallets got compromised, you wouldn&rsquo;t risk losing ALL of your assets.</p>\n<p>Of course, managing multiple wallets can be a daunting task. Nonetheless, it&rsquo;s certainly a practice that can save your crypto, especially if you have a large portfolio of different coins and tokens!</p>\n<h2>Wrapping Things Up</h2>\n<p>Those were some of the best crypto wallet safety practices that every beginner crypto enthusiast should be aware of, and utilize. Of course, there are many more different safety measures that you could take, in order to ensure the security of your crypto. However, if you employ the practices that were discussed in this section, you&rsquo;ll already be ahead of the curve, by a significant margin!</p>\n<p>So, how safe is cryptocurrency, and is it safe to invest in crypto, in the first place? It&rsquo;s clear that, if you follow all of the proper precautions, <strong>crypto can be relatively safe</strong>. Though it&rsquo;s important to always stay up-to-date and aware of what&rsquo;s happening in the industry!</p>","preview_url":"https://www.bitdegree.org/crypto/learn/how-safe-is-cryptocurrency","youtube_video":{"id":136,"channel_id":1,"sort":14,"video_title":"Is Your Crypto Safe? (5 Best Crypto Security Practices Explained)","description":"How safe is cryptocurrency, and what are some of the best crypto wallet safety practices?\n\nCryptocurrency wallets are designed with security in mind - that’s obvious. However, even the most secure wallet in the world can fail, if the owner doesn’t understand the basic principles of wallet safety!\n\nIn this video, I will tell you about how safe is cryptocurrency, as well as the best crypto wallet safety practices that any and all wallet owners need to employ. We’ll look into both hardware and software wallets, talk about is crypto safe, in general, and discuss tips that will suit both of these types of crypto storage.\n\nDo you have any additional tips for keeping your crypto wallet safe? Share them in the comments below!\n\nVideo Time Table:\n\n0:00 Introduction to Best Crypto Security Practices\n1:08 Don't Tell Anyone About Your Crypto\n3:10 Store Your Recovery Phrase Somewhere Safe\n4:15 Avoid Clicking Weird Links on the Internet\n5:35 Don't Carry Your Wallet Around With You\n6:50 Be Careful With Your Transactions\n8:26 Wrap-up: Best Crypto Security Practices\n\nGet Quick Crypto Tips on Twitter - Follow:\nhttps://twitter.com/crypto_xplained\n\n#HowSafeIsCryptocurrency #CryptoSecurity #IsCryptocurrencySafe","video_id":"bN5XetWivGA","duration":549,"view_count":221,"thumbnail_url":"https://i.ytimg.com/vi/bN5XetWivGA/hq720.jpg","thumbnail_width":1280,"thumbnail_height":720,"published_at":"2023-02-01 16:48:42","created_at":"2023-02-01T23:00:03.000000Z","updated_at":"2023-05-21T23:00:04.000000Z","channel":{"id":1,"title":"CryptoFinallyExplained","channel_id":"UCOryUY0yxC08eJtK23mNgiA","main_playlist_id":"UUOryUY0yxC08eJtK23mNgiA"}}},"chapterTitle":"NFTs","cryptoBookSection":{"id":1,"featured_image_id":6396,"original_id":null,"youtube_video_id":11,"author_id":42,"translator_id":null,"chapter_id":5,"title":"What are Non-Fungible Tokens (NFTs)?","slug":"what-are-nfts","definition":"Can you wrap your head around the fact that one of the most expensive NFTs in the world was sold for over $69,3 million?","status":"published","content":"<p>Many people who have gotten into <strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-non-fungible-token-nft/">NFTs will tell you that the learning curve is really confusing. Both crypto experts, and also traditional artists that have never heard about <strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-blockchain/">blockchain technology</a></strong> before are going to have completely different outlooks on what an NFT is, and what it can be used for.</p>\n<p>Personally, I believe that everyone should have at least a fundamental understanding of NFTs&nbsp;since they are becoming increasingly more popular by the day. Understanding the concept will surely help you clearly see what NFTs are and why they are so valuable.</p>\n<p>In this section, we&rsquo;re going to take a good look at NFTs - specifically, what they are, where they come from, why they are so expensive, and how you can purchase or even create them yourself. And don&rsquo;t worry - we&rsquo;ll avoid any and all technical jargon, and only introduce industry terms when they&rsquo;re absolutely essential to the context of the section.&nbsp;</p>\n<p><em>So, let&rsquo;s dive in!</em></p>\n<p>An &ldquo;NFT&rdquo; is a &ldquo;<strong>non-fungible token</strong>&rdquo;. &ldquo;Non-fungible&rdquo; is a fancy way of saying that something is completely unique, and cannot be replaced with something else.</p>\n<p>For example, think of your car (of course, if you have one)&nbsp;- sure, there are other cars out there that are probably just like yours, but they&rsquo;ll have different mileage, different tires, engines, personal interior gadgets, various dings &amp; dents, or even those stupid stickers on the trunk. All of these things make your car UNIQUE - there&rsquo;s only ONE car purely like THAT!</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/media/what-are-nfts-1.o.jpg/" alt=\"What are NFTs: &quot;Non-Fungible Token&quot; definition.\" width=\"1000\" height=\"550\" /></p>\n<p>So, before we continue, an example of a &ldquo;<strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-fungible/">fungible&rdquo; asset would be the <strong>value of a $1 bill</strong>. This is because the value of your $1 will always be equal to the value of another $1 bill, and you can trade your $1 for any other $1 bill out there - something you wouldn&rsquo;t be able to do with your car.</p>\n<p>Following that, a token is simply a <strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-digital-asset/">digital asset</a></strong>.&nbsp;</p>\n<p>Rather, tokens are used as <strong>representations of different asset kinds</strong>. Obviously, you can&rsquo;t physically take your car and just put it into the internet, as you put it into your garage. That's why you need some sort of digital representation tool! And this is where tokens come in.&nbsp;</p>\n<p>So, if you have a car, you could create a token to represent that car on the internet, as a physical object. Although there&rsquo;s much more to it, in this context, you can think of it as a digitalized version of a physical item.</p>\n<p>Moving on and continuing with that car example, let&rsquo;s imagine you have taken a picture of your car, and later created a digital token for it - this would be the NFT of your car! It&rsquo;s &ldquo;non-fungible&rdquo; since it&rsquo;s unique, and it&rsquo;s a token since it&rsquo;s not the actual car, but rather, <strong>a digital representation</strong> of it!</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/media/what-are-nfts-2.o.jpg/" alt=\"What are NFTs: transforming a physical object into an NFT.\" width=\"1000\" height=\"550\" /></p>\n<p>Most people associate the term NFT with trading cards, digital artwork, or in-game items and characters. It&rsquo;s important to understand that the NFTs themselves aren&rsquo;t the actual assets, but rather, representations of those assets on the blockchain.</p>\n<p>Now, <strong>blockchains are essentially data storage locations</strong> - <em>virtual databases, if you will</em>. If you were to create a unique token - an NFT - on a blockchain, it would receive <strong>a special code,</strong> which would be used to identify it in the future. Since blockchains are (mostly) public, everyone would be able to see that the token was both created by you&nbsp;and that it&rsquo;s the original - not a copy-pasted version made by your friend or a random guy on the internet.</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/media/what-are-nfts-3.o.jpg/" alt=\"What are NFTs: Blockchain and NFTs.\" width=\"1000\" height=\"800\" /></p>\n<p><em>Heh, that&rsquo;s a lot to wrap your head around, I&rsquo;ll admit. </em>But don&rsquo;t worry - it gets easier from here.</p>\n<p>Let me give you another example by referencing <strong>Twitter former CEO&rsquo;s Jack Dorsey&rsquo;s tweet. </strong>Dorsey created an NFT out of his first-ever tweet and auctioned it off for <strong>over $2,9 million.</strong></p>\n<p>Is the tweet available for everyone to see? Yes. However, the creator-signed NFT version of the tweet belongs solely to the individual who won the auction - this is very simple to prove with the help of the blockchain.</p>\n<p>When viewed on the blockchain, NFTs are simply <strong>strings of data. </strong>This textual data references an image, a GIF, or any other asset that can be viewed on the <strong><a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/best-cryptocurrency-exchange/">exchange platforms</a></strong> where the NFT is located on. Thus, when you purchase an NFT, you actually purchase that referential data.</p>\n<p>Now, this point is crucial to understand - if you own an NFT, it actually means that <strong>you own only that data.</strong> Not an image, nor a GIF, nor some sort of a virtual character - instead, you own the data that references the aforementioned assets. This data is encoded on the blockchain and references the place where the asset (picture, GIF, etc.) is located (the server).</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/media/what-are-nfts-4.o.jpg/" alt=\"What are NFTs: how NFTs work.\" width=\"1000\" height=\"550\" /></p>\n<p>Theoretically, the marketplace platform could swap out the image on their servers, and your data would point to a different picture of GIF than the one you&rsquo;ve bought! Also, the image can simply be deleted from the server - your data on the blockchain, on the other hand, can not.</p>\n<p>Personally, this idea always bothered me the most, when it comes to NFTs. However, when you understand that you don&rsquo;t own the actual image, but rather, the data on the blockchain, things start making much more sense.</p>\n<p>So, why do people buy NFTs, and why are some NFTs priced as high as they are? I mean, the earlier-mentioned Jack Dorsey&rsquo;s tweet is a good reference here as well as some of the image collections from the popular NFT creators like <strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-cryptopunks/">CryptoPunks or <strong><a href=https://www.bitdegree.org/"https://en.wikipedia.org/wiki/Bored_Ape/" target=\"_blank\" rel=\"nofollow noindex noopener\">Bored Ape</a></strong>.</p>\n<p>Well, there are actually a few things that lead to NFTs being as desirable as they are.</p>\n<p>For starters, they are <strong>a true innovation</strong> in the first place, and as most have heard, also an easy way to invest and get some profits. NFTs are the first phenomenon of this kind, and people still don&rsquo;t really know what to make of them. Should they purely become a future art? Maybe the gaming industry could benefit most from them? Is there any utility for an NFT?</p>\n<p>These questions showcase that NFTs are still very new, and people are attracted to innovations that may potentially prove to be a good investment.</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/media/what-are-nfts-5.o.jpg/" alt=\"What are NFTs: why do people buy expensive NFTs?\" width=\"1000\" height=\"650\" /></p>\n<p>This is actually the second big reason behind their popularity - the speculated value of what NFTs will be worth in the future. Some people compare NFTs to tech stocks back in the late 90s and the early 2000s. When the internet was still very young, people had no way of telling how much Amazon or Google stocks would be worth in a couple of decades.</p>\n<p>Nowadays, though, you have some NFTs being sold for huge amounts of money. For example, one of the most expensive NFTs ever sold is Beeple&rsquo;s <strong>&ldquo;EVERYDAY: THE FIRST 5000 DAYS&rdquo;</strong> - it was sold for <strong>over $69,3 million.</strong> Following that, Beeple&rsquo;s &ldquo;One&rdquo; was sold for $28,9 million. Some CryptoPunks have also been sold for anywhere from almost $8 million to over $10 million.</p>\n<p>The parallel here is that NFTs are still <strong>a very new concept,</strong> and a volatile market to be entering. It&rsquo;s like a carnival - everything&rsquo;s shiny and colorful, you never really know what sort of cool attraction lies around the corner, and every once in a while, you may find yourself on a rollercoaster ride - the last part is true for many NFT prices.</p>\n<p>This brings me to my next point - the reason why some NFTs are priced as high as they are. The answer here is actually very boring and simple - it&rsquo;s a <strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-supply-and-demand/">supply &amp; demand</a></strong> type of deal.</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/media/what-are-nfts-6.o.jpg/" alt=\"What are NFTs: why are NFTs so expensive?\" width=\"1000\" height=\"580\" /></p>\n<p>Imagine that you have a very rare painting. You decide to auction it off on eBay, without setting a minimum bid. Sure, someone may come around and offer a couple of dollars for the painting.</p>\n<p>However, since it&rsquo;s so rare, it&rsquo;s highly likely to attract a lot of attention from art fans. This results in huge demand for something that&rsquo;s very scarce - in other words, something that has <strong>a limited supply. </strong>This makes the price of the asset go up, exponentially.</p>\n<p>The same is true with many NFTs, as well. If the token is part of an exclusive collection, and there are only 10 NFTs that will ever be created within that collection, this makes it desirable for a lot of people - hence, the price goes up.</p>\n<p><strong>Social influence and renown</strong> are often huge factors, as well. Once again, think about the earlier-mentioned Jack Dorsey&rsquo;s tweet NFT. Being one of the founders of Twitter, Jack Dorsey is a prominent figure in the business world - naturally, him selling an NFT of his very first tweet on the platform that he founded would draw a lot of attention and interest!</p>\n<p>Taking a step back, another reason why NFTs are as hyped up as they are is <strong>the utility factors. </strong>While most people assume that non-fungible tokens are merely used for collectible purposes, this isn&rsquo;t necessarily true.</p>\n<p>Imagine if your favorite clothing store would issue a set of limited NFTs. In addition to being some cool images or GIFs that you can acquire, each NFT would provide the holder with lifetime access to set discounts when shopping within the store. This is a case for the utility aspect of an NFT - in other words, it creates tangible, real-world value for a non-fungible token.</p>\n<p>Combine this with the fact that there&rsquo;s a limited number of NFTs available, and that all of them are auctioned off to the highest bidders, and this can result in some tokens possessing a huge price tag.</p>\n<p><em>So, let&rsquo;s recap</em>. <strong>NFTs are valuable and sought-after</strong> because they are rare, might be created or owned by a famous or well-known individual, can provide tangible, real-world value, and are an innovation. The sum of these features leads to everyone, including their pets, having at least heard of NFTs, even if you know nothing else about the crypto space.</p>\n<p>Now, when you think about valuable NFTs today, the first names that would probably come to my mind are <strong>CryptoKitties, CryptoPunks, Decentraland, the Bored Ape Yacht Club, and Banksy.</strong> This is fair - many of these NFTs were the catalysts that drove the relatively niche industry into the mainstream.</p>\n<p>However, what was the very first NFT that was ever created? And when did this happen?</p>\n<p>Surprisingly, it&rsquo;s not any one of the names mentioned earlier. Instead, the very first NFT - of the kind that we&rsquo;re used to today, that is - was created all the way back in 2014, by a man named <strong>Kevin McCoy. </strong>The piece is called<strong> &ldquo;Quantum&rdquo;</strong> and is up for sale for <strong>over $7 million dollars.</strong></p>\n<p>So, while pop culture-relevant non-fungible tokens helped bring mainstream awareness to the market, and exploded the topic into unparalleled popularity, artists have been experimenting with the technology long before that.</p>\n<p>Finally, on the topic of experimenting with the technology, let&rsquo;s now take a look at how YOU, - <em>yes, YOU</em> - <strong>can create an NFT of your own. </strong>Allow me to reassure you - while it may sound difficult from the sidelines, creating an NFT is actually very straightforward.</p>\n<p>First things first - you&rsquo;re going to need a <strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-wallet/">cryptocurrency wallet</a>. </strong>This will act as the storage area for your NFTs, and will also house the <strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-cryptocurrency/">cryptocurrency needed to pay for the creation process of the token. Think of it this way - if an NFT is a car, then the cryptocurrency used to make it is gas. Without gas, the car is practically useless. Following this example, a crypto wallet would be like a garage for your car.</p>\n<p>The most popular wallet in this regard is called <strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-metamask/">MetaMask. It&rsquo;s free to use, and you can download and install it as a browser extension. Once you set it up, you&rsquo;ll be able to start using the wallet almost instantly.</p>\n<p>Next up, you need to fund the wallet. This can be done by visiting an exchange platform and purchasing some cryptocurrency for <strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-fiat/">fiat money</a>.</strong> The currency that you&rsquo;ll want to buy is known as <strong><a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/buy-ethereum-eth/">Ether (commonly referred to simply as Ethereum).</p>\n<p>Before we continue, though - why Ether? Well, the absolute <strong>majority of NFTs are created on the Ethereum blockchain.</strong> Thus, in order to pay for the creation process, you need to use the native currency of this particular blockchain - Ether.</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/media/what-are-nfts-7.o.jpg/" alt=\"What are NFTs: how to create an NFT?\" width=\"1000\" height=\"650\" /></p>\n<p>Once you purchase Ether and transfer it from the exchange to your MetaMask wallet, you&rsquo;re ready to go!</p>\n<p>Now, you will need to visit what&rsquo;s known as <strong>an</strong> <strong>NFT marketplace</strong> where NFTs are auctioned. Just like eBay or Amazon for traditional goods, NFT marketplaces allow you to browse through different non-fungible tokens, and <strong>bid, purchase or sell the ones that you like.</strong> On that note, these marketplaces also allow you to create NFTs on them&nbsp;in a simple and efficient manner. For the sake of this example, I&rsquo;ll reference the most popular NFT marketplaces out there - <strong>OpenSea and Rarible.</strong></p>\n<p>What you&rsquo;ll need to do is <strong>connect your MetaMask wallet to OpenSea</strong> - this is like creating an account on the marketplace. Once you do so, you&rsquo;ll be able to start the NFT creation process - OpenSea has a very detailed tutorial that guides you all through the process, and even if it&rsquo;s your first time, you shouldn&rsquo;t face any struggles whatsoever.</p>\n<p>Once you upload your picture or GIF&nbsp;and set all of the properties to your liking, all that you&rsquo;ll need to do is create the NFT. Upon completion, your wallet address (the unique identification number of your personal cryptocurrency wallet) will <strong>forever be tied to the NFT,</strong> and no matter who owns it, you will always remain the verified creator of the asset in the blockchain log.</p>\n<p>Moving on, now that you&rsquo;re equipped with the knowledge of how NFTs are created, buying a token will seem like a super-simple process.</p>\n<h2>How to Buy an NFT?&nbsp;</h2>\n<p>In order to buy an NFT, you will need to have the same MetaMask wallet connected to OpenSea, and that wallet will need to be funded with Ether, as well. It&rsquo;s <strong>not possible to purchase NFTs with fiat money,</strong> and thus, it needs to be exchanged for crypto.</p>\n<p>With your wallet connected, you are now able to purchase your desired NFT (if it&rsquo;s on sale) or bid on it at an auction. If you win, the token will be transferred to your wallet. That&rsquo;s it - you&rsquo;re a proud owner of a non-fungible token!</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/media/what-are-nfts-8.o.jpg/" alt=\"What are NFTs: how to acquire an NFT?\" width=\"1000\" height=\"600\" /></p>\n<p>Make sure to keep your tokens secure, however - you could still store them in your MetaMask wallet, but if you want extra added security, you could also look into purchasing a <strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-hardware-wallet/">hardware wallet</a></strong> (a physical crypto wallet device), and connecting it to your MetaMask.</p>\n<p>Now as a recap, we took a good, non-technical look at the essentials of NFTs. We&rsquo;ve covered what they are and what they aren&rsquo;t, talked about their value proposition, and also covered the questions of how to create and purchase your desired non-fungible tokens.</p>\n<p>Anyways, if you want to learn more about the MetaMask wallet, make sure to check out the section <strong>\"<a href=https://www.bitdegree.org/"/crypto/learn/what-is-metamask/">What is the MetaMask?</a>\".</strong></p>","meta_title":"What are NFTs? A Guide to Creating or Purchasing One","meta_description":"Can't find a clear and simple explanation about what are NFTs? Find an answer right here alongside a guide to creating or purchasing an NFT.","meta_keywords":"what is an nft, what are nfts, what is a nft, what is a nft, what is nft mean, what is nft stand for, are nfts worth it, what are nfts in crypto","order":1,"language":"en","created_at":"2022-05-02T06:07:35.000000Z","updated_at":"2023-05-16T11:44:33.000000Z","modified_content":"<p>Many people who have gotten into <strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-non-fungible-token-nft/">NFTs will tell you that the learning curve is really confusing. Both crypto experts, and also traditional artists that have never heard about <strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-blockchain/">blockchain technology</a></strong> before are going to have completely different outlooks on what an NFT is, and what it can be used for.</p>\n<p>Personally, I believe that everyone should have at least a fundamental understanding of NFTs&nbsp;since they are becoming increasingly more popular by the day. Understanding the concept will surely help you clearly see what NFTs are and why they are so valuable.</p>\n<p>In this section, we&rsquo;re going to take a good look at NFTs - specifically, what they are, where they come from, why they are so expensive, and how you can purchase or even create them yourself. And don&rsquo;t worry - we&rsquo;ll avoid any and all technical jargon, and only introduce industry terms when they&rsquo;re absolutely essential to the context of the section.&nbsp;</p>\n<p><em>So, let&rsquo;s dive in!</em></p>\n<p>An &ldquo;NFT&rdquo; is a &ldquo;<strong>non-fungible token</strong>&rdquo;. &ldquo;Non-fungible&rdquo; is a fancy way of saying that something is completely unique, and cannot be replaced with something else.</p>\n<p>For example, think of your car (of course, if you have one)&nbsp;- sure, there are other cars out there that are probably just like yours, but they&rsquo;ll have different mileage, different tires, engines, personal interior gadgets, various dings &amp; dents, or even those stupid stickers on the trunk. All of these things make your car UNIQUE - there&rsquo;s only ONE car purely like THAT!</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/media/what-are-nfts-1.o.jpg/" alt=\"What are NFTs: &quot;Non-Fungible Token&quot; definition.\" width=\"1000\" height=\"550\" /></p>\n<p>So, before we continue, an example of a &ldquo;<strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-fungible/">fungible&rdquo; asset would be the <strong>value of a $1 bill</strong>. This is because the value of your $1 will always be equal to the value of another $1 bill, and you can trade your $1 for any other $1 bill out there - something you wouldn&rsquo;t be able to do with your car.</p>\n<p>Following that, a token is simply a <strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-digital-asset/">digital asset</a></strong>.&nbsp;</p>\n<p>Rather, tokens are used as <strong>representations of different asset kinds</strong>. Obviously, you can&rsquo;t physically take your car and just put it into the internet, as you put it into your garage. That's why you need some sort of digital representation tool! And this is where tokens come in.&nbsp;</p>\n<p>So, if you have a car, you could create a token to represent that car on the internet, as a physical object. Although there&rsquo;s much more to it, in this context, you can think of it as a digitalized version of a physical item.</p>\n<p>Moving on and continuing with that car example, let&rsquo;s imagine you have taken a picture of your car, and later created a digital token for it - this would be the NFT of your car! It&rsquo;s &ldquo;non-fungible&rdquo; since it&rsquo;s unique, and it&rsquo;s a token since it&rsquo;s not the actual car, but rather, <strong>a digital representation</strong> of it!</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/media/what-are-nfts-2.o.jpg/" alt=\"What are NFTs: transforming a physical object into an NFT.\" width=\"1000\" height=\"550\" /></p>\n<p>Most people associate the term NFT with trading cards, digital artwork, or in-game items and characters. It&rsquo;s important to understand that the NFTs themselves aren&rsquo;t the actual assets, but rather, representations of those assets on the blockchain.</p>\n<p>Now, <strong>blockchains are essentially data storage locations</strong> - <em>virtual databases, if you will</em>. If you were to create a unique token - an NFT - on a blockchain, it would receive <strong>a special code,</strong> which would be used to identify it in the future. Since blockchains are (mostly) public, everyone would be able to see that the token was both created by you&nbsp;and that it&rsquo;s the original - not a copy-pasted version made by your friend or a random guy on the internet.</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/media/what-are-nfts-3.o.jpg/" alt=\"What are NFTs: Blockchain and NFTs.\" width=\"1000\" height=\"800\" /></p>\n<p><em>Heh, that&rsquo;s a lot to wrap your head around, I&rsquo;ll admit. </em>But don&rsquo;t worry - it gets easier from here.</p>\n<p>Let me give you another example by referencing <strong>Twitter former CEO&rsquo;s Jack Dorsey&rsquo;s tweet. </strong>Dorsey created an NFT out of his first-ever tweet and auctioned it off for <strong>over $2,9 million.</strong></p>\n<p>Is the tweet available for everyone to see? Yes. However, the creator-signed NFT version of the tweet belongs solely to the individual who won the auction - this is very simple to prove with the help of the blockchain.</p>\n<p>When viewed on the blockchain, NFTs are simply <strong>strings of data. </strong>This textual data references an image, a GIF, or any other asset that can be viewed on the <strong><a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/best-cryptocurrency-exchange/">exchange platforms</a></strong> where the NFT is located on. Thus, when you purchase an NFT, you actually purchase that referential data.</p>\n<p>Now, this point is crucial to understand - if you own an NFT, it actually means that <strong>you own only that data.</strong> Not an image, nor a GIF, nor some sort of a virtual character - instead, you own the data that references the aforementioned assets. This data is encoded on the blockchain and references the place where the asset (picture, GIF, etc.) is located (the server).</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/media/what-are-nfts-4.o.jpg/" alt=\"What are NFTs: how NFTs work.\" width=\"1000\" height=\"550\" /></p>\n<p>Theoretically, the marketplace platform could swap out the image on their servers, and your data would point to a different picture of GIF than the one you&rsquo;ve bought! Also, the image can simply be deleted from the server - your data on the blockchain, on the other hand, can not.</p>\n<p>Personally, this idea always bothered me the most, when it comes to NFTs. However, when you understand that you don&rsquo;t own the actual image, but rather, the data on the blockchain, things start making much more sense.</p>\n<p>So, why do people buy NFTs, and why are some NFTs priced as high as they are? I mean, the earlier-mentioned Jack Dorsey&rsquo;s tweet is a good reference here as well as some of the image collections from the popular NFT creators like <strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-cryptopunks/">CryptoPunks or <strong><a href=https://www.bitdegree.org/"https://en.wikipedia.org/wiki/Bored_Ape/" target=\"_blank\" rel=\"nofollow noindex noopener\">Bored Ape</a></strong>.</p>\n<p>Well, there are actually a few things that lead to NFTs being as desirable as they are.</p>\n<p>For starters, they are <strong>a true innovation</strong> in the first place, and as most have heard, also an easy way to invest and get some profits. NFTs are the first phenomenon of this kind, and people still don&rsquo;t really know what to make of them. Should they purely become a future art? Maybe the gaming industry could benefit most from them? Is there any utility for an NFT?</p>\n<p>These questions showcase that NFTs are still very new, and people are attracted to innovations that may potentially prove to be a good investment.</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/media/what-are-nfts-5.o.jpg/" alt=\"What are NFTs: why do people buy expensive NFTs?\" width=\"1000\" height=\"650\" /></p>\n<p>This is actually the second big reason behind their popularity - the speculated value of what NFTs will be worth in the future. Some people compare NFTs to tech stocks back in the late 90s and the early 2000s. When the internet was still very young, people had no way of telling how much Amazon or Google stocks would be worth in a couple of decades.</p>\n<p>Nowadays, though, you have some NFTs being sold for huge amounts of money. For example, one of the most expensive NFTs ever sold is Beeple&rsquo;s <strong>&ldquo;EVERYDAY: THE FIRST 5000 DAYS&rdquo;</strong> - it was sold for <strong>over $69,3 million.</strong> Following that, Beeple&rsquo;s &ldquo;One&rdquo; was sold for $28,9 million. Some CryptoPunks have also been sold for anywhere from almost $8 million to over $10 million.</p>\n<p>The parallel here is that NFTs are still <strong>a very new concept,</strong> and a volatile market to be entering. It&rsquo;s like a carnival - everything&rsquo;s shiny and colorful, you never really know what sort of cool attraction lies around the corner, and every once in a while, you may find yourself on a rollercoaster ride - the last part is true for many NFT prices.</p>\n<p>This brings me to my next point - the reason why some NFTs are priced as high as they are. The answer here is actually very boring and simple - it&rsquo;s a <strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-supply-and-demand/">supply &amp; demand</a></strong> type of deal.</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/media/what-are-nfts-6.o.jpg/" alt=\"What are NFTs: why are NFTs so expensive?\" width=\"1000\" height=\"580\" /></p>\n<p>Imagine that you have a very rare painting. You decide to auction it off on eBay, without setting a minimum bid. Sure, someone may come around and offer a couple of dollars for the painting.</p>\n<p>However, since it&rsquo;s so rare, it&rsquo;s highly likely to attract a lot of attention from art fans. This results in huge demand for something that&rsquo;s very scarce - in other words, something that has <strong>a limited supply. </strong>This makes the price of the asset go up, exponentially.</p>\n<p>The same is true with many NFTs, as well. If the token is part of an exclusive collection, and there are only 10 NFTs that will ever be created within that collection, this makes it desirable for a lot of people - hence, the price goes up.</p>\n<p><strong>Social influence and renown</strong> are often huge factors, as well. Once again, think about the earlier-mentioned Jack Dorsey&rsquo;s tweet NFT. Being one of the founders of Twitter, Jack Dorsey is a prominent figure in the business world - naturally, him selling an NFT of his very first tweet on the platform that he founded would draw a lot of attention and interest!</p>\n<p>Taking a step back, another reason why NFTs are as hyped up as they are is <strong>the utility factors. </strong>While most people assume that non-fungible tokens are merely used for collectible purposes, this isn&rsquo;t necessarily true.</p>\n<p>Imagine if your favorite clothing store would issue a set of limited NFTs. In addition to being some cool images or GIFs that you can acquire, each NFT would provide the holder with lifetime access to set discounts when shopping within the store. This is a case for the utility aspect of an NFT - in other words, it creates tangible, real-world value for a non-fungible token.</p>\n<p>Combine this with the fact that there&rsquo;s a limited number of NFTs available, and that all of them are auctioned off to the highest bidders, and this can result in some tokens possessing a huge price tag.</p>\n<p><em>So, let&rsquo;s recap</em>. <strong>NFTs are valuable and sought-after</strong> because they are rare, might be created or owned by a famous or well-known individual, can provide tangible, real-world value, and are an innovation. The sum of these features leads to everyone, including their pets, having at least heard of NFTs, even if you know nothing else about the crypto space.</p>\n<p>Now, when you think about valuable NFTs today, the first names that would probably come to my mind are <strong>CryptoKitties, CryptoPunks, Decentraland, the Bored Ape Yacht Club, and Banksy.</strong> This is fair - many of these NFTs were the catalysts that drove the relatively niche industry into the mainstream.</p>\n<p>However, what was the very first NFT that was ever created? And when did this happen?</p>\n<p>Surprisingly, it&rsquo;s not any one of the names mentioned earlier. Instead, the very first NFT - of the kind that we&rsquo;re used to today, that is - was created all the way back in 2014, by a man named <strong>Kevin McCoy. </strong>The piece is called<strong> &ldquo;Quantum&rdquo;</strong> and is up for sale for <strong>over $7 million dollars.</strong></p>\n<p>So, while pop culture-relevant non-fungible tokens helped bring mainstream awareness to the market, and exploded the topic into unparalleled popularity, artists have been experimenting with the technology long before that.</p>\n<p>Finally, on the topic of experimenting with the technology, let&rsquo;s now take a look at how YOU, - <em>yes, YOU</em> - <strong>can create an NFT of your own. </strong>Allow me to reassure you - while it may sound difficult from the sidelines, creating an NFT is actually very straightforward.</p>\n<p>First things first - you&rsquo;re going to need a <strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-wallet/">cryptocurrency wallet</a>. </strong>This will act as the storage area for your NFTs, and will also house the <strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-cryptocurrency/">cryptocurrency needed to pay for the creation process of the token. Think of it this way - if an NFT is a car, then the cryptocurrency used to make it is gas. Without gas, the car is practically useless. Following this example, a crypto wallet would be like a garage for your car.</p>\n<p>The most popular wallet in this regard is called <strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-metamask/">MetaMask. It&rsquo;s free to use, and you can download and install it as a browser extension. Once you set it up, you&rsquo;ll be able to start using the wallet almost instantly.</p>\n<p>Next up, you need to fund the wallet. This can be done by visiting an exchange platform and purchasing some cryptocurrency for <strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-fiat/">fiat money</a>.</strong> The currency that you&rsquo;ll want to buy is known as <strong><a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/buy-ethereum-eth/">Ether (commonly referred to simply as Ethereum).</p>\n<p>Before we continue, though - why Ether? Well, the absolute <strong>majority of NFTs are created on the Ethereum blockchain.</strong> Thus, in order to pay for the creation process, you need to use the native currency of this particular blockchain - Ether.</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/media/what-are-nfts-7.o.jpg/" alt=\"What are NFTs: how to create an NFT?\" width=\"1000\" height=\"650\" /></p>\n<p>Once you purchase Ether and transfer it from the exchange to your MetaMask wallet, you&rsquo;re ready to go!</p>\n<p>Now, you will need to visit what&rsquo;s known as <strong>an</strong> <strong>NFT marketplace</strong> where NFTs are auctioned. Just like eBay or Amazon for traditional goods, NFT marketplaces allow you to browse through different non-fungible tokens, and <strong>bid, purchase or sell the ones that you like.</strong> On that note, these marketplaces also allow you to create NFTs on them&nbsp;in a simple and efficient manner. For the sake of this example, I&rsquo;ll reference the most popular NFT marketplaces out there - <strong>OpenSea and Rarible.</strong></p>\n<p>What you&rsquo;ll need to do is <strong>connect your MetaMask wallet to OpenSea</strong> - this is like creating an account on the marketplace. Once you do so, you&rsquo;ll be able to start the NFT creation process - OpenSea has a very detailed tutorial that guides you all through the process, and even if it&rsquo;s your first time, you shouldn&rsquo;t face any struggles whatsoever.</p>\n<p>Once you upload your picture or GIF&nbsp;and set all of the properties to your liking, all that you&rsquo;ll need to do is create the NFT. Upon completion, your wallet address (the unique identification number of your personal cryptocurrency wallet) will <strong>forever be tied to the NFT,</strong> and no matter who owns it, you will always remain the verified creator of the asset in the blockchain log.</p>\n<p>Moving on, now that you&rsquo;re equipped with the knowledge of how NFTs are created, buying a token will seem like a super-simple process.</p>\n<div class=\"container\">\n <div class=\"row justify-content-center\">\n <div class=\"col-md-10 comparison-suggestion pb-3 mb-4\">\n <div class=\"d-flex flex-row\">\n <div class=\"text-center\">\n <div class=\"img-block-yt\">\n <img src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/assets/images/compare-crypto-exchanges.gif/"/n alt=\"What is an NFT? (Explained with Animations)\"\n title=\"What is an NFT? (Explained with Animations)\" class=\"border-0\">\n <p>Video Explainer</p>\n </div>\n </div>\n <div class=\"col-xs-10 col-sm-10 col-md-10 text-left py-3 yt-info\">\n <h4 class=\"mb-1\">Video Explainer: What are Non-Fungible Tokens (NFTs)?</h4>\n <p class=\"py-1 mb-0 youtube-video-subtitle\">Reading is not your thing? Watch the \"What are Non-Fungible Tokens (NFTs)?\" video explainer</p>\n </div>\n </div>\n <div class=\"row justify-content-center text-center\">\n <div class=\"col-12 col-md-11 px-3\">\n <div class=\"wrapper mb-0\">\n <div class=\"youtube mb-4 bg-transparent p-0 video-modal-popup\" data-toggle=\"modal\"\n data-target=\"#video-modal\" data-id=\"YL0-sEzDDNI\" data-title=\"CryptoFinallyExplained\">\n <div class=\"video-gradient-top\"></div>\n <p class=\"text-left dyk-video-title\">What is an NFT? (Explained with Animations)</p>\n <img src=https://www.bitdegree.org/"https://i.ytimg.com/vi/YL0-sEzDDNI/hq720.jpg/"/n alt=\"What is an NFT? (Explained with Animations)\"\n title=\"What is an NFT? (Explained with Animations)\"\n class=\"p-0\">\n <img class=\"play-button\" data-target=\"#video-modal\"\n src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/assets/video-button.png/"/n alt=\"What is an NFT? (Explained with Animations)\">\n </div>\n </div>\n </div>\n </div>\n <div class=\"row justify-content-center text-center\">\n <div>\n <a href=https://www.bitdegree.org/"https://www.youtube.com/c/CryptoFinallyExplained?sub_confirmation=1\%22\n class=\"btn yt-promo mb-2\" target=\"_blank\" rel=\"nofollow noopener\">\n <div class=\"row justify-content-center align-items-center mx-0 text-center\">\n <div class=\"col-4 col-md-4\">\n <i class=\"fab fa-youtube yt-dyk-btn\"></i>\n </div>\n <div class=\"col-8 col-md-8 text-center yt-promo-text\">\n <h4 class=\"m-0 text-white\">SUBSCRIBE</h4>\n <span>ON YOUTUBE</span>\n </div>\n </div>\n </a>\n </div>\n </div>\n </div>\n </div>\n</div>\n<div class=\"modal fade\" id=\"video-modal\" tabindex=\"-1\" role=\"dialog\" aria-labelledby=\"YL0-sEzDDNI\">\n <div class=\"modal-dialog modal-dialog-centered modal-lg\" role=\"document\">\n <div class=\"modal-content\">\n <div class=\"modal-body p-0\">\n <button type=\"button\" class=\"video-modal-close close\" data-dismiss=\"modal\" aria-label=\"Close\">\n <i aria-hidden=\"true\" class=\"fas fa-times\"></i>\n </button>\n <div id=\"iframe\"></div>\n </div>\n <a class=\"text-decoration-none\"\n href=https://www.bitdegree.org/"https://www.youtube.com/c/CryptoFinallyExplained?sub_confirmation=1\%22\n rel=\"nofollow noopener\" target=\"_blank\">\n <div class=\"modal-footer p-0 d-block bg-white\">\n <div class=\"row justify-content-center m-0\">\n <div class=\"col-3 col-md-4 col-lg-2 p-0\">\n <img class=\"w-100 h-100\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/assets/crypto-subscribe.jpg/" alt=\"Subscribe\">\n </div>\n <div class=\"col-9 col-md-8 col-lg-2 px-0 d-flex\">\n <div class=\"modal-subscribe w-100\">\n <p class=\"m-0 mt-1 mr-3\">SUBSCRIBE<br>\n <span class=\"m-0\">ON YOUTUBE</span>\n </p>\n </div>\n </div>\n <div class=\"col-12 col-md-12 col-lg-8 p-0 text-center d-flex justify-content-center align-items-center\">\n <div class=\"modal-subscribe-text\">\n <h4 class=\"m-0\">Understand crypto with ease</h4>\n <span>New explainer videos every week!</span>\n </div>\n </div>\n </div>\n </div>\n </a>\n </div>\n </div>\n</div>\n<h2>How to Buy an NFT?&nbsp;</h2>\n<p>In order to buy an NFT, you will need to have the same MetaMask wallet connected to OpenSea, and that wallet will need to be funded with Ether, as well. It&rsquo;s <strong>not possible to purchase NFTs with fiat money,</strong> and thus, it needs to be exchanged for crypto.</p>\n<p>With your wallet connected, you are now able to purchase your desired NFT (if it&rsquo;s on sale) or bid on it at an auction. If you win, the token will be transferred to your wallet. That&rsquo;s it - you&rsquo;re a proud owner of a non-fungible token!</p>\n<p><img style=\"display: block; margin-left: auto; margin-right: auto;\" title=\"\" src=https://www.bitdegree.org/"https://assets.bitdegree.org/crypto/storage/media/what-are-nfts-8.o.jpg/" alt=\"What are NFTs: how to acquire an NFT?\" width=\"1000\" height=\"600\" /></p>\n<p>Make sure to keep your tokens secure, however - you could still store them in your MetaMask wallet, but if you want extra added security, you could also look into purchasing a <strong><a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-hardware-wallet/">hardware wallet</a></strong> (a physical crypto wallet device), and connecting it to your MetaMask.</p>\n<p>Now as a recap, we took a good, non-technical look at the essentials of NFTs. We&rsquo;ve covered what they are and what they aren&rsquo;t, talked about their value proposition, and also covered the questions of how to create and purchase your desired non-fungible tokens.</p>\n<p>Anyways, if you want to learn more about the MetaMask wallet, make sure to check out the section <strong>\"<a href=https://www.bitdegree.org/"/crypto/learn/what-is-metamask/">What is the MetaMask?</a>\".</strong></p>","preview_url":"https://www.bitdegree.org/crypto/learn/what-are-nfts","youtube_video":{"id":11,"channel_id":1,"sort":61,"video_title":"What is an NFT? (Explained with Animations)","description":"What is an NFT?\n\nAn NFT is a non-fungible token - a representation of digital or physical assets on the blockchain. Popular for many reasons, from a sense of exclusivity to investment, NFTs are often thought to be the future of financial technology and art! \n\nNFTs have really taken the world by storm over the past few years, but to some they are still as mysterious as ever. In this video, I’ll explain to you what an NFT is and what you need to know about it in a simple way. Without using any crypto jargon, I’ll give you simple examples and analogies to make you understand how NFTs are made, how they work, and what they have become in our modern world!\n\nHave you ever created, bought, or sold NFTs before? Share your experience in the comments below!\n\nVideo Time Table:\n\n0:00 What is an NFT?\n1:12 What Are NFTs?\n2:49 Blockchain And NFTs\n3:37 Example of an NFT - a Tweet\n4:00 What Do You Actually Buy?\n5:13 Why Do People Buy NFTs?\n7:07 Why Are NFTs So Expensive?\n9:07 How Are NFTs Made?\n10:00 How Can YOU Make an NFT?\n12:33 How To buy an NFT?\n13:19 Wrap-up: What is an NFT?\n\nGet Quick Crypto Tips on Twitter - Follow:\nhttps://twitter.com/crypto_xplained\n\n#WhatIsAnNFT #WhatAreNFTs #GuideToNFTs #NFT #NFTs #NFTs2022 #Crypto #Tokens #Blockchain","video_id":"YL0-sEzDDNI","duration":826,"view_count":16851,"thumbnail_url":"https://i.ytimg.com/vi/YL0-sEzDDNI/hq720.jpg","thumbnail_width":1280,"thumbnail_height":720,"published_at":"2022-01-20 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Chapter 5: NFTs

What are Non-Fungible Tokens (NFTs)?

Can you wrap your head around the fact that one of the most expensive NFTs in the world was sold for over $69,3 million?
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Many people who have gotten into NFTs will tell you that the learning curve is really confusing. Both crypto experts, and also traditional artists that have never heard about blockchain technology before are going to have completely different outlooks on what an NFT is, and what it can be used for.

Personally, I believe that everyone should have at least a fundamental understanding of NFTs since they are becoming increasingly more popular by the day. Understanding the concept will surely help you clearly see what NFTs are and why they are so valuable.

In this section, we’re going to take a good look at NFTs - specifically, what they are, where they come from, why they are so expensive, and how you can purchase or even create them yourself. And don’t worry - we’ll avoid any and all technical jargon, and only introduce industry terms when they’re absolutely essential to the context of the section. 

So, let’s dive in!

An “NFT” is a “non-fungible token”. “Non-fungible” is a fancy way of saying that something is completely unique, and cannot be replaced with something else.

For example, think of your car (of course, if you have one) - sure, there are other cars out there that are probably just like yours, but they’ll have different mileage, different tires, engines, personal interior gadgets, various dings & dents, or even those stupid stickers on the trunk. All of these things make your car UNIQUE - there’s only ONE car purely like THAT!

What are NFTs: "Non-Fungible Token" definition.

So, before we continue, an example of a “fungible” asset would be the value of a $1 bill. This is because the value of your $1 will always be equal to the value of another $1 bill, and you can trade your $1 for any other $1 bill out there - something you wouldn’t be able to do with your car.

Following that, a token is simply a digital asset

Rather, tokens are used as representations of different asset kinds. Obviously, you can’t physically take your car and just put it into the internet, as you put it into your garage. That's why you need some sort of digital representation tool! And this is where tokens come in. 

So, if you have a car, you could create a token to represent that car on the internet, as a physical object. Although there’s much more to it, in this context, you can think of it as a digitalized version of a physical item.

Moving on and continuing with that car example, let’s imagine you have taken a picture of your car, and later created a digital token for it - this would be the NFT of your car! It’s “non-fungible” since it’s unique, and it’s a token since it’s not the actual car, but rather, a digital representation of it!

What are NFTs: transforming a physical object into an NFT.

Most people associate the term NFT with trading cards, digital artwork, or in-game items and characters. It’s important to understand that the NFTs themselves aren’t the actual assets, but rather, representations of those assets on the blockchain.

Now, blockchains are essentially data storage locations - virtual databases, if you will. If you were to create a unique token - an NFT - on a blockchain, it would receive a special code, which would be used to identify it in the future. Since blockchains are (mostly) public, everyone would be able to see that the token was both created by you and that it’s the original - not a copy-pasted version made by your friend or a random guy on the internet.

What are NFTs: Blockchain and NFTs.

Heh, that’s a lot to wrap your head around, I’ll admit. But don’t worry - it gets easier from here.

Let me give you another example by referencing Twitter former CEO’s Jack Dorsey’s tweet. Dorsey created an NFT out of his first-ever tweet and auctioned it off for over $2,9 million.

Is the tweet available for everyone to see? Yes. However, the creator-signed NFT version of the tweet belongs solely to the individual who won the auction - this is very simple to prove with the help of the blockchain.

When viewed on the blockchain, NFTs are simply strings of data. This textual data references an image, a GIF, or any other asset that can be viewed on the exchange platforms where the NFT is located on. Thus, when you purchase an NFT, you actually purchase that referential data.

Now, this point is crucial to understand - if you own an NFT, it actually means that you own only that data. Not an image, nor a GIF, nor some sort of a virtual character - instead, you own the data that references the aforementioned assets. This data is encoded on the blockchain and references the place where the asset (picture, GIF, etc.) is located (the server).

What are NFTs: how NFTs work.

Theoretically, the marketplace platform could swap out the image on their servers, and your data would point to a different picture of GIF than the one you’ve bought! Also, the image can simply be deleted from the server - your data on the blockchain, on the other hand, can not.

Personally, this idea always bothered me the most, when it comes to NFTs. However, when you understand that you don’t own the actual image, but rather, the data on the blockchain, things start making much more sense.

So, why do people buy NFTs, and why are some NFTs priced as high as they are? I mean, the earlier-mentioned Jack Dorsey’s tweet is a good reference here as well as some of the image collections from the popular NFT creators like CryptoPunks or Bored Ape.

Well, there are actually a few things that lead to NFTs being as desirable as they are.

For starters, they are a true innovation in the first place, and as most have heard, also an easy way to invest and get some profits. NFTs are the first phenomenon of this kind, and people still don’t really know what to make of them. Should they purely become a future art? Maybe the gaming industry could benefit most from them? Is there any utility for an NFT?

These questions showcase that NFTs are still very new, and people are attracted to innovations that may potentially prove to be a good investment.

What are NFTs: why do people buy expensive NFTs?

This is actually the second big reason behind their popularity - the speculated value of what NFTs will be worth in the future. Some people compare NFTs to tech stocks back in the late 90s and the early 2000s. When the internet was still very young, people had no way of telling how much Amazon or Google stocks would be worth in a couple of decades.

Nowadays, though, you have some NFTs being sold for huge amounts of money. For example, one of the most expensive NFTs ever sold is Beeple’s “EVERYDAY: THE FIRST 5000 DAYS” - it was sold for over $69,3 million. Following that, Beeple’s “One” was sold for $28,9 million. Some CryptoPunks have also been sold for anywhere from almost $8 million to over $10 million.

The parallel here is that NFTs are still a very new concept, and a volatile market to be entering. It’s like a carnival - everything’s shiny and colorful, you never really know what sort of cool attraction lies around the corner, and every once in a while, you may find yourself on a rollercoaster ride - the last part is true for many NFT prices.

This brings me to my next point - the reason why some NFTs are priced as high as they are. The answer here is actually very boring and simple - it’s a supply & demand type of deal.

What are NFTs: why are NFTs so expensive?

Imagine that you have a very rare painting. You decide to auction it off on eBay, without setting a minimum bid. Sure, someone may come around and offer a couple of dollars for the painting.

However, since it’s so rare, it’s highly likely to attract a lot of attention from art fans. This results in huge demand for something that’s very scarce - in other words, something that has a limited supply. This makes the price of the asset go up, exponentially.

The same is true with many NFTs, as well. If the token is part of an exclusive collection, and there are only 10 NFTs that will ever be created within that collection, this makes it desirable for a lot of people - hence, the price goes up.

Social influence and renown are often huge factors, as well. Once again, think about the earlier-mentioned Jack Dorsey’s tweet NFT. Being one of the founders of Twitter, Jack Dorsey is a prominent figure in the business world - naturally, him selling an NFT of his very first tweet on the platform that he founded would draw a lot of attention and interest!

Taking a step back, another reason why NFTs are as hyped up as they are is the utility factors. While most people assume that non-fungible tokens are merely used for collectible purposes, this isn’t necessarily true.

Imagine if your favorite clothing store would issue a set of limited NFTs. In addition to being some cool images or GIFs that you can acquire, each NFT would provide the holder with lifetime access to set discounts when shopping within the store. This is a case for the utility aspect of an NFT - in other words, it creates tangible, real-world value for a non-fungible token.

Combine this with the fact that there’s a limited number of NFTs available, and that all of them are auctioned off to the highest bidders, and this can result in some tokens possessing a huge price tag.

So, let’s recap. NFTs are valuable and sought-after because they are rare, might be created or owned by a famous or well-known individual, can provide tangible, real-world value, and are an innovation. The sum of these features leads to everyone, including their pets, having at least heard of NFTs, even if you know nothing else about the crypto space.

Now, when you think about valuable NFTs today, the first names that would probably come to my mind are CryptoKitties, CryptoPunks, Decentraland, the Bored Ape Yacht Club, and Banksy. This is fair - many of these NFTs were the catalysts that drove the relatively niche industry into the mainstream.

However, what was the very first NFT that was ever created? And when did this happen?

Surprisingly, it’s not any one of the names mentioned earlier. Instead, the very first NFT - of the kind that we’re used to today, that is - was created all the way back in 2014, by a man named Kevin McCoy. The piece is called “Quantum” and is up for sale for over $7 million dollars.

So, while pop culture-relevant non-fungible tokens helped bring mainstream awareness to the market, and exploded the topic into unparalleled popularity, artists have been experimenting with the technology long before that.

Finally, on the topic of experimenting with the technology, let’s now take a look at how YOU, - yes, YOU - can create an NFT of your own. Allow me to reassure you - while it may sound difficult from the sidelines, creating an NFT is actually very straightforward.

First things first - you’re going to need a cryptocurrency wallet. This will act as the storage area for your NFTs, and will also house the cryptocurrency needed to pay for the creation process of the token. Think of it this way - if an NFT is a car, then the cryptocurrency used to make it is gas. Without gas, the car is practically useless. Following this example, a crypto wallet would be like a garage for your car.

The most popular wallet in this regard is called MetaMask. It’s free to use, and you can download and install it as a browser extension. Once you set it up, you’ll be able to start using the wallet almost instantly.

Next up, you need to fund the wallet. This can be done by visiting an exchange platform and purchasing some cryptocurrency for fiat money. The currency that you’ll want to buy is known as Ether (commonly referred to simply as Ethereum).

Before we continue, though - why Ether? Well, the absolute majority of NFTs are created on the Ethereum blockchain. Thus, in order to pay for the creation process, you need to use the native currency of this particular blockchain - Ether.

What are NFTs: how to create an NFT?

Once you purchase Ether and transfer it from the exchange to your MetaMask wallet, you’re ready to go!

Now, you will need to visit what’s known as an NFT marketplace where NFTs are auctioned. Just like eBay or Amazon for traditional goods, NFT marketplaces allow you to browse through different non-fungible tokens, and bid, purchase or sell the ones that you like. On that note, these marketplaces also allow you to create NFTs on them in a simple and efficient manner. For the sake of this example, I’ll reference the most popular NFT marketplaces out there - OpenSea and Rarible.

What you’ll need to do is connect your MetaMask wallet to OpenSea - this is like creating an account on the marketplace. Once you do so, you’ll be able to start the NFT creation process - OpenSea has a very detailed tutorial that guides you all through the process, and even if it’s your first time, you shouldn’t face any struggles whatsoever.

Once you upload your picture or GIF and set all of the properties to your liking, all that you’ll need to do is create the NFT. Upon completion, your wallet address (the unique identification number of your personal cryptocurrency wallet) will forever be tied to the NFT, and no matter who owns it, you will always remain the verified creator of the asset in the blockchain log.

Moving on, now that you’re equipped with the knowledge of how NFTs are created, buying a token will seem like a super-simple process.

What is an NFT? (Explained with Animations)

Video Explainer

Video Explainer: What are Non-Fungible Tokens (NFTs)?

Reading is not your thing? Watch the "What are Non-Fungible Tokens (NFTs)?" video explainer

What is an NFT? (Explained with Animations)

What is an NFT? (Explained with Animations) What is an NFT? (Explained with Animations)

How to Buy an NFT? 

In order to buy an NFT, you will need to have the same MetaMask wallet connected to OpenSea, and that wallet will need to be funded with Ether, as well. It’s not possible to purchase NFTs with fiat money, and thus, it needs to be exchanged for crypto.

With your wallet connected, you are now able to purchase your desired NFT (if it’s on sale) or bid on it at an auction. If you win, the token will be transferred to your wallet. That’s it - you’re a proud owner of a non-fungible token!

What are NFTs: how to acquire an NFT?

Make sure to keep your tokens secure, however - you could still store them in your MetaMask wallet, but if you want extra added security, you could also look into purchasing a hardware wallet (a physical crypto wallet device), and connecting it to your MetaMask.

Now as a recap, we took a good, non-technical look at the essentials of NFTs. We’ve covered what they are and what they aren’t, talked about their value proposition, and also covered the questions of how to create and purchase your desired non-fungible tokens.

Anyways, if you want to learn more about the MetaMask wallet, make sure to check out the section "What is the MetaMask?".