Curious about how to mint NFTs and what that process might look like? Our quick guide on the process will take you through the process of minting NFTs, picking a blockchain, an exchange, and ultimately selling your NFT.
What is an NFT?
An NFT, or non-fungible token, can be likened to the sense of digital art. It is typically a digital object or utility token that is hosted on the blockchain. These tokens are typically traded using cryptocurrency and are developed in a similar fashion as well. NFTs span a wide range of things from a digital artwork piece of a monkey worth millions, or a simple avatar within your favorite play-to-earn game. As the idea of these tokens continues to pick up steam there becomes more projects with immense value, with even more projects being worthless.
What are some examples?
A lot of big projects have come out recently centered around sports moments. The NBA has partnered with an NFT company to deliver “NBA Top Shots” to the industry. This NFT collection is digital art that simply displays specific highlight play from the NBA. This collection rose to popularity as the idea of “owning” the video clip of a crazy dunk or a clutch 3-point shot was exciting for a sports collector. Other examples of top NFT projects would be VeeFriends. Gary Vaynerchuck has created an ecosystem of NFTs that deliver real work experiences as well. This implementation of NFTs and their underlying protocol was an innovative way to provide real value to a previously confusing market. In his first release, VeeFriends Series 1, the NFTs provided utility in the sense that it would serve as an admission ticket to his physical annual convention that was starting up, among other exciting rewards and incentives.
Art collections like these are good examples of a key use case of NFTs. They also have a place in play-to-earn games. In games like Wolf Game on the Ethereum network, the NFT would be staked in the contract, and you would earn crypto in return. This is a utility case of an NFT where it serves as a useable token within a video game.
How to Mint NFTs: The Process
1. Picking the Blockchain
There are many exchanges that allow a user to mint their own NFT collection. The exchange will collect different fees and also provide different options, so deciding on which one to go with is important. There have been standout exchanges in most of the top blockchains at this point. The Ethereum blockchain is the most popular place to host NFTs, however, with the high fees associated with the Ethereum network, this is usually saved for high-value NFT collections that already have a track record of value. If the Ethereum network is not the right option, then the polygon or Solana network are typically the next alternatives. Both Solana and Polygon provide low fees for transactions, making them an extremely viable place to host, typically only costing a penny to transact. The potential downside to these chains is that they are much less popular than the widely utilized Ethereum network, thus explaining one reason for the low transaction cost.
2. Picking the Exchange
Once the blockchain decision has been made, now it is time to pick an exchange. The most common exchange is OpenSea. Opensea allows you to create an NFT in minutes and even allows you to choose between the Ethereum or polygon chain. As a user goes to the website and connects their wallet, all they have to do is click “”. After this, you upload the image, fill out some basic and brief information, then its ready to list! This could be a great way for any artist to share their collections at an extremely low cost with possible large profits to be made. As a creator, you also get royalty for every re-sell of your collection. If you would like to host your NFT on the Solana network, then magiceden would be the most commonly used exchange for that network. It’s important to remember that low fees do not always make that exchange the best option. You need to make sure that the exchange is popular enough to get the traffic necessary to make a sale.
3. Selling your NFT
Selling your NFT is essentially the same as selling another good or serve. Your product is hosted on a storefront of sorts, the exchange, where users can then spend digital currency to request transfer of ownership of the digital token. You the seller, receive proceeds from the sale and buyer receives their good, the NFT.
Do you owe taxes on Crypto & NFTs?
With all that being said, If you do decide to jump into this world of crypto and even pick yourself up some tokens or NFTs, you need to make sure that you have the proper tools on hand to help you manage your financial accounting needs. One of the best solutions for you will be Ledgible.
With Ledgible, you can report and keep track of your crypto transactions with the supported integrations as you dive into the crypto space with this new information. If you want to learn more about Ledgible and get started for free, click here.
Disclaimer: The author and Ledgible do not provide investment advice and nothing in this article is meant to be taken as such. This website is presented solely for informational and entertainment purposes and is not to be construed as a recommendation, solicitation, or an offer to buy or sell / long or short any securities, commodities, cryptocurrencies, or any related financial instruments.
