How to start working with NFTs? Algorithm of actions and life hacks
In the era of the digital revolution, where art and technology merge on new levels, unique opportunities arise for artists, collectors, and investors. Integral to this evolution are NFTs, or Non-Fungible Tokens, which open the doors to the exciting world of digital assets. But how do you embark on your journey in this captivating realm, and where can you find guidance in the sea of new technologies and possibilities?
This overview-analytical article presents a comprehensive algorithm of actions and life hacks for those who want to enter the world of NFTs.
And if you truly aspire to master this thrilling universe, why not start your journey right now? We invite you to take the first step and join our course for future NFT investors. Let’s begin this exciting journey together.
Algorithm of Actions When Starting with NFTs
Exploring the basics of blockchain and the overall Web3 worlds to understand Non-Fungible Tokens can be an exciting and valuable experience. However, without a clear algorithm, you are likely to get lost in the endless flow of information, news, technologies, and projects. Therefore, we have outlined steps below that will help you grasp the technology and its application in NFTs:
Understanding Key Concepts
What is blockchain? Start by learning fundamental concepts such as blocks, hash functions, gas (transaction fees), decentralization, and consensus. Understanding the structure of blockchain will help you realize how information is stored and managed in the network. This understanding will provide you with a basic insight into how NFTs work from the inside out.
Exploring Different Types of Blockchain
Dive into the distinctions between public blockchains (such as Ethereum, BNB Smart Chain, Solana, Polygon) and private blockchains. Understanding how different networks are structured will help you choose the right blockchain for exploring NFTs.
Studying Cryptography
Familiarize yourself with fundamental cryptographic principles, such as hash functions and digital signatures. These concepts are crucial for transaction and data security within the blockchain.
Creating a Cryptocurrency Wallet
Explore various types of cryptocurrency wallets (web wallets like MetaMask, Trust Wallet, Bybit Wallet, or hardware wallets such as Ledger, Trezor, SafePal) and create your own wallet. This will help you understand how transactions occur and how to manage your assets. Some NFT platforms might have their built-in wallets, but it is recommended to use a separate wallet for enhanced security.
Learning Smart Contracts
Delve into understanding smart contracts, which are programs operating within the blockchain and managing tokens, including NFTs. Familiarize yourself with their structure, creation, and execution.
Understanding NFTs
Learn what non-fungible tokens (NFTs) are, how they are created, their unique features, the types of media they represent (images, videos, music, etc.), and the various categories of NFTs (Collectibles, music, sport, membership, utility, game tokens, virtual worlds).
Familiarize yourself with popular NFT standards such as ERC-721 and ERC-1155, which define the rules for creating and exchanging tokens.
Researching Projects, Digital Artists, and Platforms
Explore various NFT trading platforms such as OpenSea, Blur, LooksRare, Rarible, Foundation, and others. Understanding how these marketplaces operate and the differences between them will help you comprehend the NFT market dynamics.
Study popular NFT projects (for example, Bored Ape Yacht Club, Azuki, Clone X, Moonbirds, Doodles, Cool Cats) and the teams (for example, Yuga Labs, RTFKT, Animoca Brands, Sky Mavis) behind them. Most of these projects are pioneers in the market, having caught the wave of popularity during the initial market peak, and they have since set the benchmark for all other projects. Understand the core and essence of each project, the utilities it offers to its owners, and its growth prospects. This knowledge will enable you to assess all upcoming projects in the market critically.
Familiarize yourself with in-demand and industry-recognized NFT artists. They are a driving force behind digital art. While they may not necessarily create strong communities or offer multiple utilities to token holders, their role is unique – they shape the creative landscape, advance the technological weight in art, collaborate with major brands and celebrities, and wield significant influence. For example:
- Cory Van Lew: Collaborated with Mike Tyson and Disney.
- Alessio De Vecchi: Utilized blockchain technology to create the musical project Anyma, which sells out his performances and tours worldwide.
- Reuben Wu: Worked with Asus, Apple, IBM, Jaguar Land Rover, Samsung, Volkswagen, and National Geographic, elevating the genre of photography to a qualitatively new level thanks to blockchain.
- Refik Anadol: Collaborated with companies like Google, NASA, Microsoft, and now, thanks to AI and NFTs, works with major global museums, creating unparalleled large-scale animated artworks.
Understanding Scams and Protection Against Them
As you understand, the NFT market is diverse, financially lucrative, and promising. These factors attract not only enthusiasts, researchers, creators, and investors but also various scammers.
Securing your cryptocurrency wallet, understanding various NFT scams schemes, and being aware of the legal aspects of NFT ownership are essential components of a successful experience in this market.
Engaging with the Community
Join forums, communities, and social networks dedicated to blockchain and NFTs. Interacting with experienced participants will allow you to ask questions and deepen your knowledge.
Experimentation
Develop your own NFT. Practical experience in creating and trading tokens will help you better understand the processes and complexities involved. From a fee perspective, depending on the blockchain you choose for minting, this could cost you anywhere from $1 to $100 on average.
Stay Updated with Market Developments and News
Stay updated with news and research in the blockchain and NFT space to keep abreast of the latest trends and developments. Follow NFT influencers who are driving the market and setting new trends. Engage with experienced participants; this will help you gain advice and support. Discover which global celebrities actively support the industry; celebrities play a significant role in the NFT world.
By incorporating this skill into your own habits, you will be able to:
- Understand the market’s state and cycles,
- Identify new promising projects at an early stage,
- Recognize scams and current fraudulent schemes. This knowledge will safeguard you from crypto dangers and protect your digital assets.
Taking Active Steps
Now that you understand the basic principles, technologies, and market trends, it’s time to take more active steps.
Try:
- Selecting an investment-worthy NFT project,
- Choosing an investment-promising and liquid token within the collection,
- Buying NFTs,
- Selling NFTs,
- Creating your own NFT.
By following these steps and deepening your knowledge through practice and community engagement, you will successfully navigate the world of NFTs and blockchain. You will understand how to invest in NFTs correctly and what trading strategies to use in your investments.
