What you need to know about investing in NFTs in Australia in 2022

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You can now buy non-fungible tokens (NFTs) using a wide variety of different methods, ranging from specialized marketplaces to prominent cryptocurrency exchanges like Binance and Crypto.com. com In this guide, we'll take a look at how to purchase NFTs from a marketplace that is exclusive to NFTs.

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Since the majority of NFTs are traded on the Ethereum blockchain, you will first need to acquire some ETH or another cryptocurrency that is supported. Make use of the table that we have provided below to compare the blockchains that various NFT marketplaces use.

Your cryptocurrency will need to be stored in a wallet that is compatible with the protocol before you can proceed. If you don't already have an Ethereum wallet, MetaMask is a good option to look into getting.

Do some research to find out which NFT marketplaces offer the NFT collection or category you're looking for, then sign up for an account with those marketplaces. Prepare some form of photo identification that can be used to verify your identity before connecting your cryptocurrency wallet.

You can look through the NFTs on the market to find one that you like and that is within your price range. Put in a bid or make a purchase right away. Your NFT will be added to your account as soon as it has been confirmed.

Where to purchase non-financial assets in Australia

Instructions in greater detail on how to purchase NFTs

1. Invest in digital currencies. NFTs are created through the use of a technology known as smart contracts, which means that they are typically purchased through the use of a cryptocurrency. Over ninety percent of non-fungible tokens (NFTs) are traded on Ethereum marketplaces, which indicates that the vast majority of exchanges use ETH as their primary trading token. Even though Non-Fungible Tokens (NFTs) can be bought with other tokens like BNB or NEAR, the vast majority of NFTs are traded for ETH. If you need to buy ETH in order to trade for NFTs, all you have to do is go to a cryptocurrency exchange and buy the amount of Ethereum that you want.
2. Prepare a wallet for use. The wallet known as MetaMask is by far the most popular choice for integrating Ethereum tokens with decentralized applications (dapps). The process of creating an account on MetaMask is simple, and all you need to do to get started is follow this guide. After your account has been created and verified, the next step is to send the Ether (ETH) that you purchased from the brokerage exchange to the address of the wallet that is associated with your MetaMask.
3. Pick your NFT market to participate in. There is a diverse selection of marketplaces available, so before making a purchase, be sure to investigate the NFT category you are interested in (for example, digital art, metaverses, or memes) and compare the marketplaces that provide that category.
4. Make sure you sign up for it. Create an account on the particular market of your choosing. Because the procedures for setting up a business and proving your identity vary depending on the marketplace, make sure to follow the instructions provided by the platform. You might be required to show identification issued by the government before you can start trading, but this will depend on the market you choose.
5. You should link your wallet. Connect your wallet, which in this case would be MetaMask, to the trading platform as soon as your account is ready to go. In most cases, this will consist solely of clicking a "Connect Wallet" button and then following the on-screen instructions that appear.
6. Explore the various NFTs that are available. After successfully connecting your wallet to your marketplace account, you are now able to investigate the various NFTs that are offered through the platform. Consider the amount of Ethereum you currently possess when determining which NFTs are within your financial means to purchase.
7. You can either bid on or buy NFTs. Some NFTs are structured as auctions, which means that you have to place a bid on the asset before the closing date, very similarly to how you would do so on eBay. On the other hand, certain assets can be acquired straight away.
8. Complete transaction Follow the prompts provided by the marketplace to successfully complete your order, and once it has been confirmed, your NFT will be deposited into your account. Your purchases will typically be displayed on your profile dashboard, and you will typically be able to access them through a tab labeled "My Collections" or something comparable. This tab functions in a manner analogous to that of a cryptocurrency wallet.

NFT peer-to-peer marketplaces

• The peer-to-peer market structure is utilized by a number of the most widely used NFT trading platforms. Any user who registers for an account has the ability to produce their own NFTs, which they can then sell.
• As a consequence of this, these platforms will typically maintain a vast inventory of different NFT categories for you to select from.
• Peer-to-peer marketplaces are frequently decentralized, which creates an authentic peer-to-peer environment. Since the platform does not act as a middleman, it is unable to censor, veto, or otherwise become involved in the transactions that take place on it.
• The majority of these decentralized marketplaces are built on the Ethereum network; transactions are accompanied by a gas fee, which is typically paid in ETH; however, some of these marketplaces do not accept ETH.

Popular peer-to-peer non-fungible currency markets

OpenSea

• OpenSea is the peer-to-peer (P2P) marketplace in the decentralized finance ecosystem that is likely the most well-known and popular of its kind, boasting the largest user base and transaction volume relative to its competitors.
• OpenSea was initially developed on the Ethereum Layer 2 protocol, but it has since added support for the Klaytn and Polygon blockchains as well as the tokens associated with those chains.

Read on for the complete analysis of OpenSea.

Rarible

• Rarible is a relatively exceptional market due to the fact that the distribution of its native utility token, RARI, is at the center of its governance and the economic functioning of the marketplace. RARI holders make a contribution to the community by voting on various proposals as part of their participation in the governance process.
• Rarible's primary goals are the development of innovative NFTs and the provision of adequate payment to content creators for their work.
• Rarible provides users with access to a diverse selection of NFTs, including but not limited to digital artwork, music, memes, and even adult-oriented content.

Read more about Rarible in our guide.

Mintable

• Mintable is a decentralized peer-to-peer network for trading non-fungible tokens (NFTs) that is centered on the creation of new NFTs. This platform is distinguished from the others in the industry by its zero-gas fee service, which gives artists the opportunity to create their own one-of-a-kind NFTs at no cost to them.
• The assortment of assets owned by Mintable consists of digitized works of art, collectibles, music, in-game items, and rare trading cards.

Have a look at our guide to Mintable.

Markets that have been curated

• Curated marketplaces are distinct from peer-to-peer marketplaces in that, in most cases, they are not decentralized. Instead, the platform that hosts the marketplace selects and distributes the products that are available for purchase.
• In line with this, users are typically unable to mint novel NFTs by making use of a curated marketplace; however, certain websites do allow for submissions to be reviewed.
• Curated marketplaces, on the other hand, will typically have products for sale that are of a higher quality and are less likely to engage in scams or price gouging than P2P marketplaces. P2P marketplaces give buyers and sellers more autonomy than curated marketplaces do.

Popular curated non-fungible currency markets

SuperRare

• A curated network for trading that focuses primarily on digital artwork, particularly conceptual works, SuperRare is the name of the marketplace. The majority of the most popular non-fungible tokens (such as CryptoPunks) are pixel-based and straightforward, but SuperRare has amassed a collection of abstract and intricate artwork that can be recognized with relative ease.
• In comparison to other peer-to-peer marketplaces, SuperRare only offers four different product categories, including still images, GIFs, 3D artwork, and videos. This results in a more constrained selection of goods.

Read on for the complete analysis of SuperRare.

Crypto com

• Crypto com is one of the more recent entrants to the NFT market, and it will begin facilitating the buying and selling of NFTs for its clientele in March of 2021.
• Crypto is a term that is typically used to refer to the trading of cryptocurrencies on an exchange. Users of com can now shop for a wide selection of non-fiction books (NFTs), which include a number of sports collectibles and contributions from well-known artists such as Snoop Dogg.

Read on for the complete analysis of Crypto.com.

Sorare

• Users are able to buy, trade, and sell digital trading cards through the use of Sorare, which is a marketplace that has been curated for their convenience.

Read on for the complete analysis of Sorare.

How to invest in non-financial assets

Using NFTs as a form of investment

Because of their relative unfamiliarity, high prices, and ambiguous value designations, many people are hesitant to make purchases of non-fungible tokens (NFTs). When deciding whether or not to invest in a non-traditional financial instrument (NFT), it is helpful to think of these instruments more in the vein of a collectible (such as a rare trading card or piece of artwork), rather than a stock.

As the use of these digital tokens becomes more widespread, well-known celebrities and artists are starting to mint their own versions of the tokens. Fans might be able to follow their favorite content creators, whether they are already well-known or just starting out, and buy art that they anticipate will appreciate in value.

The potential for profit from investments in NFTs extends far beyond the realm of collectibles. A metaverse is essentially a digital world that owners of NFTs are able to interact with. Users have the ability to buy the rights to domain names and land deeds in a metaverse with the intention of selling them at a later date for a profit.

One of the very first non-fungible token (NFT) series to ever be issued on the Ethereum blockchain, CryptoPunks, is a good example of this. In 2017, when it was first issued, users could pay a few hundred dollars to acquire the rights to use a CryptoPunk. The least expensive "Punk" that can be purchased as of the month of September 2021 is valued at US$108,000. However, some can be purchased for more than US$4 million.

Visa, a multinational financial technology company, has initiated an expansion into the cryptocurrency market by purchasing a "Punk" in August 2021 for close to 150,000 United States dollars.

As a form of service, NFTs

Not all non-fungible tokens are intended to be collected or used as possible investments. The range of applications for these digital assets has expanded in tandem with the expansion of their scope. Users are now able to buy, sell, and trade non-fungible tokens (NFTs) as in-game items thanks to the incorporation of NFTs into the gaming models of a number of blockchain-based games.

For instance, Axie Infinity, one of the most significant blockchain-based applications in the world, has been gaining particular prominence in the South-East Asian markets. Users compete in a game modeled after Pokemon by first purchasing NFT characters and items, and then pitting those characters in battle against other characters from all over the world.

Putting money into non-fungible token blockchains

The Ethereum 2 platform has been the foundation for the vast majority of non-fungible token platforms. 0 protocol, given its support for the development of smart contracts and decentralized applications However, as the industry of non-fungible tokens (NFTs) continues to advance, tech developers have discovered problems with using Ethereum for NFTs. These problems are primarily caused by Ethereum's high gas fees and slow transaction times.

As a response to this problem, a number of new blockchains have emerged, each of which places an emphasis on the safety of NFT transactions, creation, and transactions. These protocols, in contrast to many other NFT marketplaces, come with an attached utility token, which users can acquire in the same manner that they would acquire any other cryptocurrency (through an exchange).

Those who have some reservations about certain types of NFTs as a product but have faith in the long-term potential of the underlying technology might find it beneficial to put their money into a blockchain-based NFT instead.

• Flow (FLOW) NBA Top Shot is currently hosted on Flow, which was developed by Dapper Labs, the same company that was responsible for the development of the popular legacy NFT service CryptoKitties. Flow is currently one of the most prominent NFT platforms available on the market today. Flow's network is built on the premise of scalability without using sharding technology, which marries it to NFT marketplaces and blockchain-based video games. Flow is a decentralized payment network that operates on the Ethereum blockchain. They are currently working on developing a platform that will be officially licensed for users to purchase MMA non-fighting tokens.
• Chiliz (CHZ) Chiliz is a blockchain that was initially built on the Ethereum network and is geared toward the development of decentralized applications in the sports industry. The Chiliz development team is proud to announce that they have formed official partnerships with a large number of sports clubs and organizations, and they have also developed the Socios fan tokens system. This platform gives soccer fans the opportunity to show their support for their favorite team by purchasing NFTs from specific soccer clubs.
• Enjin (ENJ) Enjin is a blockchain that is based on Ethereum that was designed to give game developers new ways to integrate NFTs with their applications. Users are able to purchase items (such as swords and avatars) that can be utilized in associated gaming applications from Enjin's NFT marketplace. This feature is supported by gaming industry titan Ubisoft as well as other prominent gaming developers.
• The Decentralized Authority (MANA) Metaverses are the next big thing in the world of non-fungible token technology, and Decentraland is leading the way. A metaverse is essentially a digital world in which users are able to interact with both other players and the real world. Users of Decentraland have the ability to buy and sell virtual items such as avatars, weapons, and even land deeds for use in the virtual world. The MANA token, which is the application's native token, is used for conducting transactions on the network.

Putting money into non-fungible token marketplaces

Tokens for the NFT marketplace are the last option for you to take into consideration. Even though Ethereum is used by the vast majority of platforms, SuperRare (RARE) and Rarible (RARI) both have cryptocurrencies that are integral to the economic operation of their respective marketplaces.

There are a few things you ought to think about before you go ahead and make the decision to buy an NFT.

Which blockchain does it have its hosting?

The vast majority of non-fungible tokens (NFTs) are hosted on the Ethereum protocol, and ETH is used as the native buying and selling currency for these tokens. Researching the underlying blockchain of any non-fungible token (NFT) you plan to buy is a smart idea because it will help you determine whether or not you think it will be a viable option for the future of these digital assets.

How to buy and sell non-traded stocks

As was mentioned earlier, the majority of exchanges that trade NFTs are built on Ethereum; consequently, in order to buy NFTs, you will need to acquire and make use of ETH. However, there are now options available for users who wish to invest in NFTs directly with fiat currency or other cryptocurrencies such as BNB and RARI. The market is growing, so keep that in mind.

Keeping a wallet and tokens for paying gas fees is essential.

Some NFT marketplaces support direct transfers, but in most cases, you will need a Web3 wallet (typically in the form of a browser extension such as MetaMask) to connect your cryptocurrency with the platform.

In addition, it is highly likely that you will require additional funds on top of the value of the NFT in order to pay for the gas fees. In this circumstance, you will be required to make a prior purchase of these crypto tokens.

Tokens that are utilized for the purpose of paying gas fees will typically take the form of ETH, BNB, or SOL.

The dangers of investing in NFTs

Because NFTs are still relatively new, determining whether or not they would be a good investment is highly speculative at this point. There are still a lot of people who are skeptical about the actual value that NFTs represent, and some of these people believe that NFTs are nothing more than a scam.

Aside from the impact of public opinion, buying an NFT is fraught with a number of other potential dangers.

NFTs are constructed using blockchain technology and smart contracts. This technology may still be susceptible to smart contract bugs or exploits, despite the fact that its primary focus is on security. Should something like this take place on one of the NFT marketplaces where you host your NFTs, you run the risk of losing your entire collection.

The price of the NFTs that you buy is probably the most significant and widely discussed risk that comes with doing so. Even though it is possible to get your hands on some digital assets for practically nothing, getting your hands on others could cost you hundreds of thousands of dollars or even more. Because of the extremely high prices at which these NFTs are currently trading, you run the risk of losing a sizeable portion of your wealth should the market for these instruments experience a decline.

Verdict

NFTs began as a light-hearted project for tech-savvy developers and users to collaborate on and play minigames as part of. Since then, the ecosystem has experienced tremendous growth, reaching the point where almost everyone is familiar with the concept of a non-fiat token (NFT), and certain tokens are now worth tens of millions of dollars.

NFTs are one of the most speculative assets currently available on the market, and their value in the real world will continue to be a contentious topic of discussion for many years to come.

The most important question that non-profit organizations need to address is how they intend to disrupt the art and content creation industries. NFTs will make significant progress toward gaining respect if they can establish themselves as a reliable source of income for creative professionals.