How to Create an NFT: Beginner’s Guide
- Non-fungible tokens, or NFTs, have become a multi-billion dollar asset class.
- Creating, or minting, NFTs is the process of creating a unique digital asset that can later be sold or gifted.
- Potential NFT creators should take fees, marketplaces and blockchain networks into consideration before minting.
Non-fungible tokens, or NFTs, have become a mainstay of the market. While not necessarily new, NFTs have gained momentum as artists use them to sell digital artwork and traders jump on board to make millions of dollars. Big companies are even getting in on the NFT action, with companies like Starbucks planning their own NFTs.
NFT trading topped nearly $18 billion in 2021, up more than 21,000% from 2020, according to a report by research firm NonFungible.com. Although the NFT market took a hit in 2022 with the onset of “crypto winter”, people are still eager to get into the NFT market.
What is an NFT?
While the numbers surrounding the NFT market can be staggering, it is important for anyone interested in entering the space to understand exactly what an NFT is.
Broadly speaking, an NFT is a unique digital resource. It has been assigned a specific cryptographic identifier that allows the holder to prove ownership. The data related to ownership and transaction history is recorded on a blockchain network – usually Ethereum. What is important to know is that NFTs are digital, irreplaceable and tradable through online marketplaces and exchanges.
While most people may be familiar with NFTs when dealing with digital art, they can potentially be used to “tokenize” a variety of other things, such as collectibles (think baseball cards), music, and even personal information like medical records .
Although NFTs seem like a newfangled crypto-related asset, they have been around for years, says Connor Borrego, an NFT expert and co-founder of UniPro, a digital growth agency.
“NFTs started in 2015 as pointless digital collectibles,” he says. “But now in 2022, they mostly serve as membership access to social networking sites.”
How much does it cost to create an NFT?
If you’re interested in making your own NFTs, often referred to as “minting,” know that it requires some initial legwork and investment. The cost of minting an NFT can vary from a few dollars to a few thousand dollars, depending on a number of factors. It all comes down to the details.
“You can make an NFT for super cheap by getting artwork on Fiverr and posting it on OpenSea,” says Lisa Teh, co-founder of Mooning, an Australia-based Web3 marketing agency specializing in NFT and the metaverse. More realistically, Teh says investors can expect to spend between $100 and $500 to create an NFT.
But, warns Teh, “a lot of people think they can create an NFT, put it on a marketplace and then sell it, become a millionaire and retire on an island. If it was that easy, everyone would be doing it.”
Here are some of the main costs you will face:
- Start-up costs: Teh says that perhaps the biggest and most important cost is related to what makes your NFT special. “If you want to keep costs low, think about what makes your project unique. Unless you’re a well-known artist, your NFT will need some interesting tools,” she says. As such, you may need to spend money to create artwork or other assets you are trying to tokenize.
- Account fees: Choosing an NFT marketplace to create and list your NFTs is another step that requires consideration. OpenSea, Rarible, and Binance are three of the largest and most popular marketplaces, and all may have different fees related to account creation, trading, and coining. For example, OpenSea charges a couple of one-time fees to get your account up and running and a 2.5% fee on transactions.
- Actual embossing costs: It is possible to create an NFT for free (called lazy minting) on some marketplaces, such as OpenSea. But miners typically face “gas fees” for creating NFTs. These are usually paid in ETH and can vary depending on the day and time you are trying to make. Also note that even if you choose the lazy coining option, you may still have to pay fees when your NFT is sold.
How to create an NFT
Minting an NFT may sound like a technical, involved process. But for most people it is relatively easy. Besides making a few choices regarding wallets and marketplaces, creating an NFT isn’t much more than “just having a file to upload,” says Borrego.
The process itself looks like this: Choose a file to create and a blockchain network and marketplace to create on; get your wallet in order and connected; and finally, perform the upload. Here is the process in more detail:
1. Choose your unique content
Many types of content – including images or audio files – can be inserted into NFTs. Minters must ensure that they own the rights to what they mint (either after purchasing them, or as the original creator), as they can face copyright-related lawsuits if they don’t.
Choosing what to put into an NFT is the most critical step in the entire process because it will inform important decisions later, says Teh. Depending on what you plan to do with your NFT (sell it, gift it, etc.), it may be best to use certain blockchain networks and list on certain marketplaces. So pay a lot of attention to this step.
Borrego says it can be beneficial to choose to emboss art or something else you own. The embossing process will take, for example, digital works of art and “stamps on information so that owners can see where it is and where it goes”, he says. It can help creators monetize their creations and open up new avenues to monetize them.
2. Select your NFT marketplace
Borrego says the next step is to choose a marketplace, which acts as a digital exchange where NFTs can be minted, bought or sold, such as Rarible or OpenSea. This step will involve a lot of judgment, as some marketplaces work with certain blockchain networks and certain wallets, while others will not. Make sure you do your homework. Fees are also something you need to consider. And there are some marketplaces that cater to certain audiences.
“In the larger marketplaces, there can be a lot of noise,” says Teh. “So, if you’re going to list on a marketplace, look at the many out there that are for very specific tastes,” she says, adding that some marketplaces, for example, are for sports fans while others may cater to music lovers .
3. Choose a blockchain
After choosing a marketplace, you’ll want to choose a blockchain network to use, and most marketplaces offer a handful of choices. Ethereum is the most popular and busiest blockchain network. But if you use OpenSea, for example, you can also choose to use the Polygon, Klaytn and Solana blockchains.
Teh warns that while Ethereum is the default for many coiners, it is inefficient and tends to have higher gas fees, which could push some coiners to other blockchains.
4. Set up, fund and connect a crypto wallet
Then, miners need to set up, fund and connect a crypto wallet to their chosen marketplace. Wallets are software that allow users to send and receive crypto transactions, and they are essential to the minting process.
You need to choose a wallet that is compatible with your marketplace and blockchain and make sure to fund it before you start minting. It usually involves buying ETH and sending it to your wallet’s specific address from an exchange. Experts say some wallets, like MetaMask, are probably the safest route for beginners.
Borrego says MetaMask is very user-friendly and even has a Chrome browser extension to make it easy to connect to most marketplaces. But make sure you take the right precautions by protecting your seed – if you lose it, you could be locked out of your wallet forever.
5. Upload NFT
With an account set up on a marketplace, a funded and connected wallet, and a blockchain selected, the final step is to create an NFT. Each marketplace will have different steps, but in general, a user can follow a built-in guide to complete the process. It’s usually as simple as uploading a file, filling in a few descriptions, pointing it at the correct blockchain, and pressing “mint”.
But keep in mind that there may be fees for minting, unless you use a lazy minting option. And while these fees may require you to pay with crypto, Borrego says some marketplaces are implementing credit card payments to make it even easier.
After your NFT is minted, it will live in a collection that you create and be listed on the marketplace. Then it’s yours to do with what you want.
Is it worth creating an NFT?
All of this leads to a final question: Is it worth minting an NFT? There is no direct answer. It will entirely depend on your preferences and what you want to get out of it.
If you’re hoping to make a lot of money minting and selling NFTs, the odds are against you, say both Teh and Borrego. But it can be worth it to make NFTs for your own reasons, such as making gifts or keepsakes for friends and family. Be sure to weigh the benefits of NFTs against what you are willing to invest to create them.
Borrego says he believes NFTs will be around for a long time, and that we are currently only scratching the surface of their usefulness.
“People think of NFTs right now as digital collectibles, and they don’t understand why people speculate on them,” he says. Perhaps a good way to think about many of the hyped NFT projects that currently consume traders’ attention is to think about how they will be viewed in the future, he suggests.
In fact, many NFTs these days can essentially become “antiques,” Borrego says, and that can appeal to a certain type of investor.
“It will be like proof that you were there when Web3 came.”
