Gas, Burn, Mint – Stomach Problems or Selling Art?
There are lots of folk who believe that using NFTs to buy art is a way to develop a valuable asset portfolio and just as many who believe it’s a scam, but just a little understanding of the process and some nuances makes for a better decision making process when trying to evaluate or understand the world of NFT art. Before you become the new Picasso of the digital world, you will need a digital wallet, a software or service based application that stores transactional information and potentially identification that allows the user to buy or sell both physical and digital assets. Such software can reside on a smartphone or any digital device including a server, and could be thought of as a either a ‘bank account’ (with no bank attached) or a retail account (with no retailer attached). “Hot” wallets, which are on-line, are used to make quick transactions, while “Cold” wallets are more for storing assets and are not connected to the internet and are therefore more secure.
Once you have a wallet, you need to put something in it in order to pay “Gas”, the fees that are charged for listing your artwork and for executing some of the transactions. In order to fund those fees you will likely need to put Ethereum, a common cryptocurrency in your wallet. The Ethereum blockchain keeps track of all Ethereum transactions in a manner that does not put any specific information on a particular server or device, but distributes parts of the transaction data and history across hundreds or thousands of servers. You will need to use either other digital currency or ‘real’ currency from your bank account to purchase Ethereum for your wallet, usually through an intermediary like Coinbase (COIN), and Ethereum itself changes in value as do other currencies, so the value of your wallet will vary even before you become an artist.
Next you need to connect to an NFT platform, essentially a place where your art is available to others to look at and purchase. When you “mint” your art on such a site, like Opensea (pvt), they will charge “Gas” of between 2% and 3% of the transaction value. As part of the process your artwork must be verified (POW – Proof-of-Work) that entails much blockchain processing but will (hopefully) verify you as the rightful creator and owner of the digital asset. Once uploaded and verified you can decide if you just want to leave the item open, sort of an Ebay (EBAY) “Buy-it-Now” or create an auction, and then it is up to the art world to decide whether there is value in your work.
Of course you will have to ‘advertise’ in order to get noticed and that means lots of time on social media creating an image of you as the latest and greatest digital image creator, and while you are publicizing yourself you also have to deal with the rapid changes in the value of cryptocurrencies that could influence the value of your artwork, but such is life in the digital art (or music) world and participants either accept the heavy responsibilities of being a digital artist or go back to the 9 to 5. We won’t go into the ethics or legalities of the NFT art world or make a value judgement on those who profess to have made millions buying and selling digital art, but we reinforce one thing and that is to pay attention to “Gas” as the multitude of fees involved in the process can erode profits for sellers and raise costs for buyers, while fee collectors smile after every transaction.
Once you have a wallet, you need to put something in it in order to pay “Gas”, the fees that are charged for listing your artwork and for executing some of the transactions. In order to fund those fees you will likely need to put Ethereum, a common cryptocurrency in your wallet. The Ethereum blockchain keeps track of all Ethereum transactions in a manner that does not put any specific information on a particular server or device, but distributes parts of the transaction data and history across hundreds or thousands of servers. You will need to use either other digital currency or ‘real’ currency from your bank account to purchase Ethereum for your wallet, usually through an intermediary like Coinbase (COIN), and Ethereum itself changes in value as do other currencies, so the value of your wallet will vary even before you become an artist.
Next you need to connect to an NFT platform, essentially a place where your art is available to others to look at and purchase. When you “mint” your art on such a site, like Opensea (pvt), they will charge “Gas” of between 2% and 3% of the transaction value. As part of the process your artwork must be verified (POW – Proof-of-Work) that entails much blockchain processing but will (hopefully) verify you as the rightful creator and owner of the digital asset. Once uploaded and verified you can decide if you just want to leave the item open, sort of an Ebay (EBAY) “Buy-it-Now” or create an auction, and then it is up to the art world to decide whether there is value in your work.
Of course you will have to ‘advertise’ in order to get noticed and that means lots of time on social media creating an image of you as the latest and greatest digital image creator, and while you are publicizing yourself you also have to deal with the rapid changes in the value of cryptocurrencies that could influence the value of your artwork, but such is life in the digital art (or music) world and participants either accept the heavy responsibilities of being a digital artist or go back to the 9 to 5. We won’t go into the ethics or legalities of the NFT art world or make a value judgement on those who profess to have made millions buying and selling digital art, but we reinforce one thing and that is to pay attention to “Gas” as the multitude of fees involved in the process can erode profits for sellers and raise costs for buyers, while fee collectors smile after every transaction.
Fee Collector - Source: 123rf.com
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