Note: This is not financial advice. This is for educational purposes only. NFTs are a highly volatile asset class.
Many NFT pundits claim that some online digital collectibles are worthy investments. Your NFT could be modestly priced today, but over the next few years, its value could grow exponentially. However, this booming NFT market is relatively new, so who knows if it’s here to stay? In the blink of an eye, the value of your NFT could also drop to zero.
If you don’t mind the risky investment, or you simply want to purchase NFT to support a talented, digital artist, here’s an easy, step-by-step guide on how to purchase a non-fungible token. (If you need an in-depth explanation of what NFTS are, check out our explainer here).
How to buy an NFT
The most important thing you’ll need before buying an NFT is an Ethereum wallet. Why? Because most non-fungible tokens run on the Ethereum blockchain. Ethereum, unlike the Bitcoin network, allows users to deploy something called “smart contracts.”
Smart contracts don’t have anything to do with legal paperwork per se (though they can facilitate binding agreements if you read our NFTs in the real estate market article). Instead, a smart contract is a program that runs on the blockchain. Without getting too technical, smart contracts are important for NFTs because they can store important data about the token. For example, if your favorite digital artist mints an NFT, it will contain data about who owned it, when they sold it and how much.
This is, in part, why many people rave about NFTs. In the same way, an artist’s signature and a certificate of authenticity tell the buyer that they own something one-of-a-kind, a smart contract does something similar. That being said, you’ll need a Metamask wallet (an Ethereum wallet) to buy an NFT.
How to get a Metamask wallet to buy an NFT
2. After onboarding with Metamask, you’ll need to add some ETH to it. You can buy Ethereum directly on Metamask by going to Buy > Continue to Wyre. Make sure to add enough to cover the cost of your desired NFT and the accompanying Ethereum gas fee (a fee you must pay to have your transaction authorized on the Ethereum network).
Now that you’ve got your Ethereum wallet setup, you have to choose which NFT marketplace you’d like to purchase from. You can buy NFTs from SuperRare, Rarible and Mintable, but for this tutorial, I’ll show you how to purchase non-fungible tokens on OpenSea.
How to buy an NFT on OpenSea
1. Go to OpenSea.io and click on Marketplace. Here, you’ll be able to scroll through millions of NFTs. On the left panel, you can filter the NFTs by category (e.g. art, music, trading cards, etc.).
2. Once you find an NFT that catches your eye, click on it.
3. Take note of the price. It will be in ETH, but it will show you its cost in USD, too. If you’re comfortable with the price, click on “Buy Now.”
4. You will be prompted to sign into your Metamask wallet. Click on “Sign in” and type in your credentials.
5. A “Complete checkout” window will appear showing you the total price of the NFT. Tick the “Terms of Service” box.
6. Click on “Checkout.” A Metamask window will pop up giving you information about the Ethereum gas fee you’ll have to pay in addition to the NFT. On a good day, the gas fee should cost no more than $25, but I’ve seen dark days when Ethereum gas fees climbed to $500.
7. If you agree to the Ethereum gas fee, click “Confirm.”
8. You’ll be taken to a page titled “Your transaction has started.” There will be a link that says “View on Etherscan.” If you click on it, it will give you information on the progress of your NFT transaction.
Don’t fret if it takes a while for the NFT transaction to go through. If the Ethereum network is congested, it could take hours and sometimes days (yes, days! It’s happened to me) before your transaction is accepted on the blockchain.
Once your NFT is confirmed, you can admire it by navigating to your profile icon on OpenSea and clicking on “My collections.”