How to invest in NFTs in India
A Non-Fungible Token is a non-interchangeable unique digital asset used for one-of-a-kind digital artworks, music, or other collectibles which cannot be replicated. If you have an NFT of such kind, it does not indicate that you become the asset owner. Instead, you are given access to the original file’s location. The file is present over the internet and you can access it virtually anywhere and whenever you want.
Consider a situation where there are two artworks, one being the original and the other being the duplicate look-alike. Compared to a duplicate, the original artwork has more value. Similarly, an NFT cannot be duplicated, and any imitation of the asset will not hold any worth. The original artwork can only be owned by one person.
What Is an NFT?
An NFT is a digital asset that represents real-world objects like art, music, in-game items, and videos. They are bought and sold online, frequently with cryptocurrency, and they are generally encoded with the same underlying software as many cryptos.
Although they’ve been around since 2014, NFTs are gaining notoriety now because they are becoming an increasingly popular way to buy and sell digital artwork. A staggering $174 million has been spent on NFTs since November 2017.
NFTs are also generally one of a kind, or at least one of a very limited run, and have unique identifying codes. “Essentially, NFTs create digital scarcity,” says Arry Yu, chair of the Washington Technology Industry Association Cascadia Blockchain Council and managing director of Yellow Umbrella Ventures.
This stands in stark contrast to most digital creations, which are almost always infinite in supply. Hypothetically, cutting off the supply should raise the value of a given asset, assuming it’s in demand.
But many NFTs, at least in these early days, have been digital creations that already exist in some form elsewhere, like iconic video clips from NBA games or securitized versions of digital art that’s already floating around on Instagram.
For instance, famous digital artist Mike Winkelmann, better known as “Beeple” crafted a composite of 5,000 daily drawings to create perhaps the most famous NFT of the moment, “Every day: The First 5000 Days,” which sold at Christie’s for a record-breaking $69.3 million.
How NFTs Work
NFTs are created through a process called minting, in which the information of the NFT is recorded on a blockchain. At a high level, the minting process entails a new block is created, NFT information being validated by a validator, and the block being closed. This minting process often entails incorporating smart contracts that assign ownership and manage the transferability of the NFT.
As tokens are minted, they are assigned a unique identifier directly linked to one blockchain address. Each token has an owner, and the ownership information (i.e., the address in which the minted token resides) is publicly available. Even if 5,000 NFTs of the same exact item are minted (similar to general admission tickets to a movie), each token has a unique identifier and can be distinguished from the others.
How to Buy NFTs
First, you’ll need to get a digital wallet that allows you to store NFTs and cryptocurrencies. You’ll likely need to purchase some cryptocurrency, like Ether, depending on what currencies your NFT provider accepts. You can buy crypto using a credit card on platforms like Coinbase, Kraken, eToro, and even PayPal and Robinhood now. You’ll then be able to move it from the exchange to your wallet of choice.
You’ll want to keep fees in mind as you research options. Most exchanges charge at least a percentage of your transaction when you buy crypto.
How to invest in NFTs in India
NFTs can also be used to streamline investing. For example, consulting firm Ernst & Young has already developed an NFT solution for one of its fine wine investors—by storing wine in a secure environment and using NFTs to protect provenance.
Real estate can also be tokenized—a property could be parceled into multiple sections, each containing different characteristics. For example, one of the sections might be on a lakeside, while another is closer to the forest. Depending on its features, each piece of land could be unique, priced differently, and represented by an NFT. Real estate trading, a complex and bureaucratic affair, could then be simplified by incorporating relevant metadata into a unique NFT associated with only the corresponding portion of the property.
The first step to investing in NFT is to create a digital wallet. Currently, WazirX is the only Indian marketplace that offers NFT investment at present. It is suggested to create an account on WazirX.
The second step is to fund the digital wallet with cryptocurrency. In general, Ethereum (ETH) is the most accepted cryptocurrency for NFT investment. The native token for WazirX is “WRX”. The price of 1 WRX is estimated at Rs. 87. Currently, NFTs on WazirX have a fixed price. You can choose the NFT you wish to purchase by paying in WRX tokens.
You can also visit websites like OpenSea, Raible, super-rare, and Nifty Gateway to search for different NFTs and compare their price.
WazirX was founded in 2018, and it is an Indian cryptocurrency exchange with over 7.3 million users. The platform was acquired by the crypto trading platform Binance. They launched the NFT marketplace dedicated to regional and traditional creators. The platform is known to host its first NFT exhibition and is popularly known to be a good option for beginners. It charges users 5% of service fees, and creators can keep the rest of the proceedings. The platform recorded $38 billion trading in a record year by November 2021 and even crashed after heavy user activity was seen based on news of the Indian government’s cryptocurrency bill decision.
To access the WazirX marketplace you need to head over here and click on Connect Wallet button at the top to connect your Metamask Wallet. The marketplace work on the Binance Smart Chain network and you need a WRX token in your wallet to place a bid or buy an NFT.
Founded in 2016, BuyUCoin is one of the leading crypto exchanges in India that serves over 350,000 users and handles over $300 million-plus in digital asset transactions. The company has announced that its mission is to bring crypto into billion Indian pockets. It enables users to buy and sell and trade 33 cryptos, including Ethereum, Bitcoin, Ripple, Stellar, among many others. The platform charges users a 0.24% maker fee.
The platform also has a dedicated NFT marketplace that has a UI very similar to Opensea and hosts some of the popular NFT projects that are up for grabs.
Similar to OpenSea, Rarible is a democratic, open marketplace that allows artists and creators to issue and sell NFTs. RARI tokens issued on the platform enable holders to weigh in on features like fees and community rules.
4. Jupiter Meta
Jupiter Meta has just announced that it has launched India’s first fully curated innovative marketplace. It is focused on creating singular metaverse experiences via music films and games. Their NFT ‘Icons of Singara Chennai’ cities culture through digital art, NFT of food, monuments, and beaches. It was founded in 2021 to trade NFT and various creative and cultural segments built into its metaverse. The marketplace offers fixed prices and a personalized experience. The platform is backed by Rubix blockchain technology of level-1 and has zero gas fees.
Here, artists must receive “upvotes” or an invitation from fellow creators to post their art. The community’s exclusivity and cost of entry—artists must also purchase “gas” to mint NFTs—means it may boast higher-caliber artwork. For instance, Nyan Cat creator Chris Torres sold the NFT on the Foundation platform. It may also mean higher prices — not necessarily a bad thing for artists and collectors seeking to capitalize, assuming the demand for NFTs remains at current levels, or even increases over time.
Is NFT really worth investing
As NFT is a new technology in the market, it will eventually take time to get the answer to this question. You can consider investing in a genuine item of art that is available in digital form. Another reason why people invest in NFT is due to its unambiguous nature, they believe its value will rise over time.
Always remember that the world is full of valuable collectors. Digital artwork is catching the eye of many and investors are willing to pay millions to buy an original artwork that can become a statement piece. The progress of NFTs is slow and eventually can become one of the ways for digital transactions in the near future.
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