NFTs Will Someday Be Bigger Than The Internet: A Beginner's Guide

NFTs Will Someday Be Bigger Than The Internet: A Beginner’s Guide

When it comes to collectibles, NFTs are the future of digital ownership. It’s easy to assume they will be one of the biggest things to change the world since the internet. An NFT, or Non-Fungible Token, has multiple utilities, and it’s not hard to understand these tokens and everything they’re useful for. They are already changing the game from art to sports, fashion, and real estate. Even though they can come with memes and a lot of hype, pretty soon there won’t be anything that can’t be owned by proving ownership with an NFT.

With Web 2 dying and Web 3 on the rise, right now is the perfect time to get into the world of digital assets and NFTs. In the world of decentralized finance (DeFi) the federal reserve does not own your money, you do. NFTs, or Non-Fungible Tokens, means that they are not 1:1 or fungible, so you can’t exchange one NFT for another. Each NFT has its own value, so one could be worth $28, and another might be worth $300,000!

How NFTs Will Be Bigger Than The Internet

Why Own An NFT?

Even though they were made for art, NFTs open up a range of collectibles and assets that people can own, and what’s even better is that they can appreciate or depreciate in value depending on the demand of the asset and the supply of that asset’s collection.

The metaverse is something that is coming within the next decade, and fashion businesses are already leaping onto digital clothing. Within fashion, there are ways NFTs can adapt and change the industry. RTFKT, a digital fashion brand, sold a virtual jacket for over $125,000! We know, it’s WILD.

NBA Topshot, the NBA’s version of collectible online trading cards, are all NFTs that currently have a volume of $1B in sales since late July 2020. All collectibles can digitalize as an NFT. 

But this does not just stop at collectibles, you could own a share of a celebrity’s fame and invest in their success if you believe their career will be infamous. That celebrity can include you in their brand deals just for holding their NFT.

Once you own that NFT, you become a part of a community that also has NFTs in that same collection. This can include people who are new buyers just like yourself, the OG’s who’ve been there for a while, and the creators of the project. NFT projects gather and talk to their holders via Discord and Twitter. It can all go numerous ways in Web 3 and the new social world we will be living in soon.

Metaverse

How Do I Get An NFT?

So, you want to buy your first NFT? There are a few things you need to do first in order to acquire your first NFT. The following are steps to setting up a crypto wallet that will allow you to digitally pay for your assets.

  1. Download MetaMask for Ethereum or Phantom for Solana.
    • These will be the crypto wallets you use to fund and buy your NFTs.
  1. Download a trusted cryptocurrency app such as Crypto.com or CoinBase.
    • Using these two exchange marketplaces you can buy crypto with your debit or credit card.
  1. Once you have crypto, send it to your crypto wallet using a wallet address.
    • All wallets that can hold crypto have a unique code of characters called a wallet address.
  1. Go back to your crypto wallet, whether it be MetaMask or Phantom.
  1. Connect your wallet, approve the message for verification, and get to trading!

But How Do We Know Who Owns What?

Since everything nowadays is moving to digital rather than physical, assets will too. The blockchain is what we use to track who owns what. NFTs are purchased using cryptocurrencies and put on the blockchain to verify possession. There are different cryptocurrencies such as Bitcoin, Ethereum, and Solana, to name a few.

IP rights aren’t necessarily given to holders, depending on the project you may be given the right to do whatever you want with the NFT you own. You could even build an image or brand from it. Andy Nguyen built the Bored & Hungry restaurant. He built his business from an NFT from the Bored Ape Yacht Club into a restaurant and grill.

How NFTs Will Be Bigger Than The Internet

What About Taxes?

Taxes and NFTs are a little wonky, but we can give you a quick rundown. Depending on where you live and how much you profit from selling your NFTs, any token that you sell represents a capital gain and is required to be written on your tax forms. Some NFTs can be used for tax write-offs depending on where the money you invest goes. If that certain business donates most of its earnings to helping the world or doing good deeds, then you are eligible. 

Scams and Rugpulls

There are people out there who, just like in Web 2, will hit you up and ask for your information. They’ll hit you with, “your computer needs to update, download this anti-virus software immediately,” or something else about your wallet being at risk.

We advise you to NOT CLICK ON ANY suspicious links or messages in your discord, social media dm’s, or email about this topic. The following are the two scariest ways people can hack and take EVERYTHING you own from your digital wallet:

  1. SCAMS
  • Scams can come from anywhere on your phone or computer.
  • This can be social media or an email.
  • Usually, the ones that will try to get you are random people with not a lot of followers.
  1. RUGPULLS
  • When investing in a project or business make sure you DYOR (Do Your Own Research) and look up the people behind it.
  • Doxxed means that the creators of the project show their real identities with either their real names or pictures.
  • Investing in a team that does not show their identity but has a hyped-up project does NOT mean good things. The NFTs appreciate in value, and when the dust settles, they take and run with the profits of the project and there is nothing you can do about it 
cryptocurrency

Overall, NFTs are shaping and rewriting the way we function as a society. Tickets to events, Airbnb bookings, and even clothing in your virtual closet will be converted into NFTs. We hope that you do not invest in anything that you aren’t willing to lose. NFTs can depreciate in value just as quickly as they can appreciate in value. Go ahead and get on Twitter, hop into discord, and most importantly don’t forget to do your own research!

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