So there’s this craze about NFTs lately (they really moon-rocketed in 2021 and continued to do so until 2nd quarter of 2022. Things have slowed down a bit recently due to global economy trends but my guess is it will come back and continue to grow in the long run*). Many have onboarded the NFT bandwagon. But surely, this is just a small % of onboarded users.
Similar to internet, when in early 1990s users started onboarding the ‘Internet Bandwagon’, we’re in the early years of Web3 right now (right now we’re in June 2022). Current adopters are really ‘early’ as they say.
As more and more users with internet access, learn about Web3 - NFTs in particular, more would get onboard.
For someone, who’s just getting into waters, the whole process of buying an NFT may be a challenge. This is okay & as its often said, in web3 (tbh in most things in life) you can only learn by doing things yourself.
I’ve been into NFT space for 6+ months and have minted 50+ NFTs during the course of time. So I thought, I’ll put a so called manual or reference guide for those who’re seeking to dive into the NFT space but don’t know the basics or process around it. (This is not a post on how to pick NFT projects - that’s another skill you’ll learn by getting into different projects. Many will fail but few will succeed - therein lies the lessons. This post is about how to do transactions to buy NFTs)
First things first, what all do we need as a starting point:
Fiat money (USD, GBP, AUD, INR, etc.)
A crypto wallet (most start with ‘soft’ wallet. ‘Hard’ wallet is preferred but lets leave it for another post) & a crypto exchange account (like Coinbase, Gemini, etc.)
Internet
Phone / PC
Fiat money:
This is basically your local currency (USD, CAD, AUD, INR, GBP, etc.). You’ll need this to convert into a cryptocurrency like BTC, ETH, SOL, etc. NFTs trade in cryptocurrency.
Alternatively, you can mint cryptocurrency through a mining gig but thats for another day.
Some may say that why would we need fiat money in the era of web3. Well, right now predominantly our fiat money sits in a bank account. (may be down the road we may do a direct deposit into web3 “banks” like Coinbase, Binance, FTX, etc.)
2. Crypto Wallet & Crytpo exchange account
Wallet: This may be a hot wallet like Metamask (ETH), Coinbase Wallet, Phantom (Solana), Hiro (BTC) or cold wallet like Ledger, Trezor, etc.
Most starters start with hot wallets as these are easy to set-up, readily available (as browser extensions) and easy to work with.
Crypto Exchange account is needed to move your fiat money from bank to the exchange and use the fiat money to buy crypto currency like ETH, SOL, etc.
3. Internet
As we’re talking about blockchain transactions, we will need internet to submit transactions on it.
4. Phone/PC
This is essentially the GUI for you to process the transactions.
NFT Minting Process:
For simplicity, let’s assume we are planning to mint a NFT using Ethereum. (same applies to NFTs on Solana, etc.)
a. NFT to be minted
Decide on which NFT project you want to mint NFT for. (which project to mint, what to look for in a project, what drives project’s success, etc. are separate topics and understood with hands-on experience or by listening to folks (on podcast) who have succeeded in this craft. Easier said than done!)
This may be an initial mint or in a secondary market (like OpenSea, Rarible, etc.).
Initial mints are essentially project launch (go-live) mint. It allows folks to mint at a base price (mint price decided by the project team). There are some mechanics that come into play (like whitelists, # of mints allowed per wallet, supply-demand, etc.) depending upon hype of the project.
Once the project is launched & initial mint completed, the only way to purchase the NFTs are from secondary market like an OpenSea, Rarible, etc. The price in these markets may be higher or lower than the mint price - depending on project hype, project roadmap, type of holders, etc.
Always make sure you click on the official links for the project you’re trying to mint.
b. Transfer the ETH
You’ll need to transfer the ETH (or any cryptocurrency that mint is accepting) from your crypto exchange to wallet you intend to use for minting (this may be the same wallet you used to connect to crypto exchange or a different one)
c. Minting process:
Once on the mint site (either initial mint or on secondary market), you’ll be asked to connect your wallet (say MetaMask, Coinbase, etc.)
Again always make sure you’re on the right link (typically posted on project’s Twitter bio, ‘Official Links’ section in discord server of the project, on official project website, etc.)
Once connected, select ‘mint’ on website or ‘buy’ on marketplace like OpenSea, Rarible, etc.
You will get a pop-up showing gas fee details, the mint price, the total approximate amount (mint price + gas fees) that will incur in the transaction.
It is recommended to select the transaction speed as ‘High’ (default is ‘Medium’). I’ve experienced that this almost always ensures successful transaction (even when there is high demand to mint). At times I’ve got failed transactions using ‘Medium’ speed when the demand is high as ‘high’ speed ones are prioritized. Although there is difference in gas fee between ‘High’ speed (higher gas fees) and ‘Medium’ speed (lesser gas fees), the difference is negligible compared to the surety of minting the NFT especially on mint days when demand is higher.
Once you submit the transaction, the blockchain will take few seconds to confirm it. Once confirmed, you’ll receive the NFT and can see it under assets in your crypto wallet.
The crypto/web3 landscape is evolving rapidly and we may see improvements/changes in some of the ways these processes work.
Hope this article gives a detailed overview of the NFT minting process and helps you in your NFT journey.
WAGMI!
* I think there may be bear cycles in this NFT journey (as is the case in any long-term investments). Hodlers (of probably 1 to 3 blue chip projects) will be rewarded in the long run with airdrops of tokens, NFTs, etc. that will eventually make the NFT portfolio winner in the long run. Not an investment advice, just my own view :)
note: Nothing in this post is a financial advice. Also I don’t have any affiliation with any of the companies mentioned in this post (Opensea, Metamask, etc.)