How To Make Money With NFT | A Complete Guide
Updated: Oct 3, 2022
The introduction of Blockchain technology to the financial world has interrupted the old structure of investment and called upon making instant profits to survive the growing inflation. Cryptocurrency was one of the measures many relied upon over the past decade. But with the world moving forward and looking out for better resources, Non-Fungible Tokens seemed to have gained an immense reputation in similar space. Some buyers have collected more than ten times the profit invested, and some appeared to have lost more than 99 percent of the investment. With these situations upon line, it becomes necessary to know if you can make money with NFT. So without wasting another instant, let's get through our questions and become strictly aware of each possible situation.
What Are NFTs Anyway?
The internet is flooded with thousands of definitions of- what are NFTs. To digest them, we created ours, the crispiest and the simplest on the internet. Here is how it goes,
NFT means blockchain transactions in return for digital assets. Unlike before, when you were spending all those crypto wallets for buying and selling nothing but a coin, here you can own anything in metaverse like art, games, video clip, or maybe tweet and even sell them for millions.
But, How Do NFTs Work?
The definition might have given you a quick idea of- what are NFTs?. But why do they sell hot, and why would someone pay for a digital image that we can download or take a screenshot for free. Well, obviously, you are right, and to present my answer, I will have to give you a brief detail about these tokens.
NFTs contain information that reveals- "the person in control of this crypto wallet address is the owner of a digital entity stored in this location."
Through NFT, you can claim ownership of a unique collectible (art, furniture, or even real estate). You can sell a digital property, and the buyer can track ownership details using blockchain as a public ledger. The ownership details stored are a permanent (cannot be modified) entry that you can access any time of the day.
Assume I carry two Monalisas- one of which is the painting drawn by Leonardo Da Vinci and the other is a digital print. What would you pay more for knowing that both are similar pictures with differences in the value? That's the selling point of NFTs, owning rights to a virtual commodity (that can also work in the physical world like furniture).
Get Our Hands Dirty With Technical Knowledge.
I understand you have familiarized yourself with How do NFTs work? Now, I want you to step back and understand the technical part.
While creating a crypto asset, developers rely upon existing blueprints to ease the process and save costs. On the other hand, crypto projects like Ethereum realized the need for standardization so that a token can work for interoperability. Tough to understand? Let me simplify it.
Ethereum established token standards, a standard for fungible tokens that makes each Token similar to another Token. They share the same value and are of the same type. Knowing that these are equal, they become compatible with a platform or service in Ethereum Ecosystem.
Ethereum token standards ERC-721 and ERC-1155 allow developers to create and deploy NFTs on the Ethereum blockchain.
Crypto-assets such as Eos, Neo, and Tron are among the others that use similar technology to Ethereum and allow developers to host Non-Fungible tokens on their blockchain networks.
Is crypto and NFT the same?
No, they are not. Cryptocurrencies are fungible assets, while NFTs, as the name suggests, are not. You may exchange one bitcoin with another bitcoin or one Ether with another Ether. But an NFT is not equal to another NFT.
Additionally, you cannot list NFTs on any decentralized or centralized network as with cryptocurrencies. There are dedicated marketplaces like SuperRare and Opensea to list and trade NFTs.
Can NFTs Have Multiple Owners?
I know where you are coming from- The Merge is the most expensive NFT ever sold, with 28,983 collectors. How is it distributed then?
Most NFTs have a sole owner, but with the rising prices and to make them suitable for real-world deals, a new term called Fractional Ownership came in.
According to this, an NFT can have multiple owners, and the stakes will be divided just like the shares of a company. The more you pay, the more percentage and leverage you have. You can learn more about Functional Ownership here.
Where Do NFTs Create Value?
Like every commodity, NFTs have a target consumer base driven by demand and supply. The rarity and digital usability of NFTs attract gamers, while ones who love collecting art also participate, and amid this, investors take part to allocate funds and make a profit.
A survey conducted by CoinGecko says that 35.8% of the owners have Metaverse/ Gaming NFTs, followed by 27.4% of profile pictures, and 25.3% of the art NFTs, with only 11.5% contributing to other types.
Owners make a lot of money through some NFTs. For instance, one gamer bought 64 lots on the Decentraland virtual land platform and decided to combine them to make a single estate. The Secrets of Satoshi's Tea Garden sold for $80,000 purely for its location and road access.
There are many more instances like this one, and some even contribute as a daily source of income.
How To Make Money With NFT?
The most expensive NFT ever sold was worth $91.8 million. A tweet from Jack Dorsey sold for $2.9 million. A clip of Lebron James dunking basketball sold for $202,000. Altogether, they put a question to live: How To Make Money With NFT? And is making money with NFT even real in 2022? If yes, why does Bill Gates call it a Greater Fool Theory?
It is time when you get answers for them all.
NFTs can be complex, but with these points near you, they won't.
1. Make the Internet Aware Of NFTs.
When investing, most of us drop plans to avoid uncalculated risks with our money. There is my neighbor who earned quality money from crypto, but it doesn't mean I can do the same. It is the expertise that counts. One cannot forecast NFT growth or fall.
So, what if we earn without investing a single dollar. You see, there are people like you and me wanting to read or watch content made upon NFTs. It can be alarming, doubt solving, trends, or simply NEWS. Any content on Youtube or channels like Medium, Blogger, Hackernoon, or podcasts can promote your growth and let you start diving into this space.
Great content with excellent marketing and promotional tactics can give you a target audience and brand sponsorships.
2. Take Projects.
As a designer, it is not necessary to participate in creating nfts for selling. It can also be beneficial if you take freelancing projects from clients found on freelancing websites and convert their ideas into NFT artforms. You have no risks of losing out.
If you are not a designer, spread the word about an NFT by taking NFT marketing projects.
If you have zero skills, look for freelancers doing similar work for clients. Now, look for the clients through your freelancing profile. Set your pricing higher than what the freelancer you looked for is charging. Get the project and start dropshipping. Despite being an old trick, it works like a charm.
3. Create And Sell.
Let's now shift our focus to quality profits. While earning through the above two sources is playing safe, profits often belong to ones who take risks. As a designer, one can launch their own NFT collection. It may comprise original digital art, memes, video clips, audio clips, and much more. Remember to Create utility, carefully decide perks, and strategic marketing to lead to successful outcomes.
It is also not necessary to be the best at what you do. It is the thought that counts. You can also read our guide on designing an NFT from scratch. Additionally, there are websites like this one where you can animate your painting by simply uploading it on their platform, and it doesn't require any professional skillset.
Now that you have options in this space- start experimenting before launching your great project, and remember to let us know about it.
4. Make Money With NFT Trading.
Buying an NFT at a low cost and selling it for profits is another way to make money with NFT. Pablo Rodriguez-Fraile, a Miami-based collector, sold Beeple's digital art piece for almost 1000 times the buying price within six months. While trading, you need to keep an eye over the upcoming projects, the utility, seller's past record and accordingly make a decision.
5. NFT Gaming.
Probably your favorite to hear about, but as much as it sounds- "take all our money by playing." It is not. In NFT games, you get a chance to purchase in-game items and trade them. Now, it must sound similar to a typical marketplace. However, you can still take advantage. Look out for recently launched games. Some of these offer the in-game items for free of cost to the first few players. As soon as the demand for these in-game items increases, you can sell them and earn profits without even investing in the first place.
6. Rent Out.
Yes, you heard it right! NFTs are unique, and there is a crowd on the internet willing to rent an NFT for a period for which you will get paid.
An investor paid $222,000 to purchase a fragment of Digital Monaco Racing Track in the F1 Delta Time game. The NFT representing this piece allows the owner to earn a 5% dividend every time someone uses it for racing, and it even includes an entry fee.
7. NFT Staking.
Staking an NFT means locking up your asset in a staking pool for a period of time called the vesting period. Staking takes place to exchange rewards or interest after each cycle.
It is similar to how we deposit an amount in a savings account and earn interest.
NFT Staking is passive earning and often advised when planning for a long-term strategy.
8. Invest in NFT Startups.
Over the past couple of years, the crypto market witnessed the entry and success of several NFT startups. For one who is keen to make money with NFT but avoids risks, investing in NFT startups may help. As much as I can predict, NFTs will stay longer than we may think, and investing in these startups at the seed stage may revolutionize your portfolio.
Great, But Can You Really Make Money With NFT in 2022?
The Answer To This Question Lies Between A Solid Yes And A No. You see- there are instances of getting rich with NFTs and Crypto, but one should also not ignore the failures.
The market may sound attractive the graphs may fantasize many newbie investors, but as much as I want to support it, it isn't worth the same.
NFTs and Cryptocurrency are 100% unpredicted. Watching how two dots sell for almost $100 million proves it is a part of the Greater Fool Theory.
As long as the market continues to grow, NFTs can be favorable to artists but are not to the buyers or the sellers.
Conclusion.
The answer to How to Make Money With NFT is simple, but when you are dealing without knowledge, things can become complex. This article was an impartial take on NFTs and if you should consider investing to earn profits.
The idea of NFTs might have sounded better if they had consumed less energy and benefitted through artworks like Monalisa and physical entities that retain value over time.
What do you think? Do NFTs have the potential to take over the traditional economic methods? I expect to see you in the comments!