Cryptocurrency And NFT Trading: Earn Passive income Online
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What is NFT?
NFT is an acronym for Non-Fungible Token, which is a token that resembles a cryptocurrency. However, while cryptocurrencies are fungible like physical currencies, meaning one Bitcoin is directly replaceable by another, NFTs are non-fungible, meaning they are like physical assets that you can sell in a market. For example, a 1-pound coin is essentially the same as any other, but a rare baseball trading card is different from almost all others.
NFT Art Trading
Much of the excitement surrounding NFT trading involves digital artwork, but it can be anything from music to game pieces. Some of the biggest NFTs have been sports trading cards, music, and CryptoKitties, a game that trades images of cats.
How NFTs work
NFTs, like cryptocurrencies, are digital tokens stored in a blockchain ledger and traded over the network. NFT trading offers many benefits such as transparency, security, and immutability. More details on the benefits of the blockchain can be found here.
Are NFTs a fad?
Cynics often point out that owning NFTs is useless given the nature of digital artworks and assets. For example, a digital artwork that could sell for several million dollars can easily be downloaded by anyone to view, edit, or use, making trading NFTs pointless.
This is not much different than physical art, though, because anyone can go online and download an image of the Mona Lisa or buy a print. However, that does not make your printed poster worth $900 million. Likewise, ownership of an NFT is more valuable than a copy, and its value is determined by market forces.
The easiest and most obvious way to get into the NFT trade is to simply buy and sell NFTs. To find an NFT for sale, you need to visit a dedicated marketplace or app. There are many marketplaces on the internet, most with slightly different focuses or benefits.
You will also need a digital wallet for the transaction, but not just any wallet. Not all wallets can support NFTs, so make sure you find one that does. Once it’s set up, you’ll need to fill it with cryptocurrencies. Then you can buy any NFT you have the money for with the wallet. The sale will then be permanently logged in the blockchain and the NFT will appear in your wallet once the sale is verified.
Investing in the NFT industry.
If you do not want to get directly involved in NFT trading but want to invest in the industry, trading NFT marketplace tokens or cryptocurrencies is the way to go. As a marketplace grows, the value of the tokens used to make transactions increases. Some of the larger marketplaces, like FLOW, can be traded on cryptocurrency exchanges.
Similarly, you can trade cryptos used for NFT trading, such as Ethereum. As ETH is increasingly used for both NFTs and regular purchases, its value would increase and you can make profits by reselling tokens.
A slightly more obscure way to trade NFTs is offered by the virtual reality world called Decentraland. This is a digital platform similar to those in science fiction movies like Ready Player One. The world consists of plots, each of which is an NFT that you can buy and thus own.
With the plots you can create anything you want, from a building to a game to an advertisement. These plots can increase in price as the world becomes more popular and land becomes scarcer or more useful. Parcels can be resold or rented out for other creators to place their content there, allowing for a range of NFT trading options.
Create and sell NFTs
Finally, you can also make money by simply creating an NFT you want to buy and then selling it. No special skills are required to create the digital asset itself; if you want to create a piece of digital art in Paint, you can. Transferring it to an NFT, however, is a bit more difficult.
Most NFT-supporting blockchains have templates you can use. Ethereum, for example, has ERC-721, which is used to create most NFTs. Semi-fungible tokens, such as concert tickets or some gaming items, use the ERC-1155 standard. There is also a new standard, EIP-2309, which allows creators to mint as many NFTs as needed in a single transaction.
OpenSea is a leading NFT trading platform with the largest digital marketplace. Customers can trade a range of NFTs, from art and collectibles to domain names. More than 700 projects are available and fees are competitive with a 2.5% transaction fee for sellers. OpenSea accepts a full range of payment methods, including Ethereum.
All in all, a good option for investors who are new to NFT trading. It offers a wide range of products and a user-friendly interface.
Nifty Gateway is a centralized marketplace based on the US dollar. You can buy and sell artwork and collectibles, known as ‘nifties’, here. The platform made headlines when Canadian musician Grimes raised $6 million after selling her virtual artwork on the platform. The company also works with innovative brands to offer limited edition collections that are available for a specific period of time.
Nifty Gateway NFT Trade
Especially for individuals trading in USD, Nifty Gateway is a good option.
Rarible is another popular NFT trading platform that connects buyers with sellers. You can find an impressive portfolio of digital artworks and memes on the user-friendly platform.
Rarible also offers its own digital currency, RARI, which is used in conjunction with Ethereum to facilitate trading. One benefit of owning RARI is that customers can vote on changes to the platform and have a say in the artwork sold. The NFT trading platform has also partnered with OpenSea and collects a 2.5% fee on each sale.
Rarible NFT Trade
Overall, Rarible is another great option for traders who are new to NFT trading.
NBA Top Shot
The last NFT trading provider on our list is NBA Top Shot. It is the product of a partnership between the NBA and a Vancouver-based blockchain company called Dapper Labs. The platform offers videos and a 3D spatial representation of game clips that can be purchased in the form of “packs.” Prices for Top Shot packs start at $9 but rise to $999 for rare and legendary categories, and hundreds of thousands of buyers can join the queue to get their hands on the digital products.
NBA Top Shot NFT Trade
For basketball fans, NBA Top Shot is the clear choice when it comes to NFT trading platforms.
A big incentive for NFT trading is the possibility of better recognition and payment for artists. Nowadays, artists are usually paid by platforms or companies that promote them and sell their work. Artists then receive a portion of the revenue in the form of royalties, but these are often small or do not take into account the additional value that the work could accumulate.
NFT trading not only verifies all artwork and ties it back to the creator, but also provides special royalty opportunities. NFTs allow artists to profit directly from all sales of the NFT, no matter how far in the future they may be. When an NFT is created, it can be assigned a value that passes a certain percentage of each sale back to the original creator.
This means that a work of art that originally sold for $10 and skyrockets to $1 million the next time it is sold will make its creator money based on its new value, not just the original $10.
The dangers of NFT trading.
Although blockchain ledgers are difficult to manipulate, there are still dangers and scams associated with NFTs. Some crypto whales (people who own large amounts of a cryptocurrency) can sell an NFT from one wallet to another wallet they own at a much higher price than it would actually be worth. This is known as wash trading and artificially drives up the price of the NFT before reselling it to an unsuspecting NFT trader.
Blockchain ledgers may be difficult to hack for the reasons mentioned above, but there are other ways hackers can get at a person’s assets. Trading NFTs requires a digital wallet in which to store them, and these wallets can be hacked, so it is important to ensure that sufficient defenses are in place.
Is NFT trading secure?
In order for a new block to be added to a blockchain, certain numbers must be mined and verified. This requires a lot of computing power, but makes it very difficult to create false information in blocks. In order to process one block, each subsequent block must also be processed correctly. Mining many blocks makes this more difficult, as it is harder to process 1,000 blocks than ten.
This is not ignored by blockchain systems. Ethereum is currently introducing a new model that uses financial stakes rather than massive computational tasks to validate new blocks. This new blockchain, ETH2, works the same as the previous model in every other way, allowing for secure and transparent trading of NFTs, with only a reduced environmental impact. The energy saving potential of this system is enormous, with projections of 99.98% energy reduction.
This may sound like it would remove the decentralization that is at the heart of blockchain, but that is not the case. It is simply a different method for the nodes in the network to ensure security. ETH2 is also intended to improve efficiency without
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