If you’ve ever tried to explore the world of non-fungible tokens (NFTs), you’ve probably heard of OpenSea. This platform is perhaps the most prominent gateway to the NFT market, and you could see it as a marketplace that you will use to explore and interact with the space.
Before diving into NFT, it’s important to understand ways to invest in NFT. In this article, we will be discussing everything you need to know about ways to invest in OpenSea NFTs.
What is NFT?
NFT is an acronym for non-fungible token. These tokens are digital representations of real-world things like art, music, videos, and in-game purchases. Each token is unique, which is why it is not fungible. They are very popular with all types of collectors, including sports trading card collectors. They use blockchain technology to process transactions and encrypt the identity of the NFT owner.
Crypto assets like Bitcoin and Ethereum are fungible or interchangeable, while NFTs benefit from blockchain technology, making digital assets provably unique and non-interchangeable. In other words, NFTs provide the much-needed irreplaceability to bring unique digital and physical assets onto the blockchain.
What is OpenSea?
OpenSea is an NFT marketplace that entered the NFT movement early on and has become the go-to place not only for NFT traders but also for NFT developers. Beyond the first-mover advantage, OpenSea’s success can be attributed to its open-world design, which allows anyone to create NFTs for free and buy and sell them on an auditable infrastructure powered by blockchain technology. This open-world design attracts hordes of NFT creators as there are few, if any, restrictions stifling the creative and transactional flow.
Despite the controversy surrounding its operations, OpenSea remains the largest NFT marketplace, processing over $3.5 billion worth of Ethereum-based NFT transactions in August 2021 alone. Judging by this statistic, OpenSea published only $20 million worth of NFT transaction volume throughout 2020.
Six Ways to Invest in OpenSea NFTs
The following are the ways to invest in OpenSea NFTs:
Get a Digital Wallet and Fund it
You need a digital wallet to buy NFTs. On OpenSea, the currency you use to buy is Ether (ETH). Using the most popular NFT web wallet, MetaMask, although Coinbase Wallet has also quickly become a popular favourite.
If you don’t have the wallet installed, visit metamask.io as an extension for your web browser and connect it to OpenSea. To do this, go to OpenSea and navigate to the top right bar and click on Profiles. You will be redirected to a new page asking you to connect your wallet. Choose MetaMask, Coinbase Wallet or other available options.
Grant OpenSea all necessary permissions to use your wallet and sign the signature requests.
After installation, you can view the collection of NFTs available on the OpenSea Marketplace. If you don’t have ETH, go to your MetaMask wallet and click “Buy” – you can make a crypto deposit directly or use a debit/credit card.
Or, if you prefer, you can set up a Coinbase wallet – another very popular option that users love and that comes with the reputation of the Coinbase brand itself.
The process is very similar to installing MetaMask – you go to the official Coinbase website and add the non-custodial wallet as a Chrome extension and generate your wallet. It doesn’t matter which wallet you use to interact with OpenSea, but the Coinbase wallet comes with some additional benefits.
Browse the OpenSea NFT Collection
First, you need to find the NFT you want to purchase. Go to your OpenSea profile and click Explore. There you will see thousands of collections of NFTs.
In the top right bar, you can filter your search by clicking Trending, Popular, Art, Collectibles, Domains, Music, Photography, Sports, Trading Cards, Click “Utilities”, and “Virtual Worlds”.
Buy the NFT
After verifying that the NFT is a genuine transaction, click Buy Now to verify the purchase further and then navigate to the checkout popup, where you will find the final cost of the purchase.
If everything is ok, press the “Checkout” button to complete the transaction. This way, OpenSea will redirect you to your wallet, where you will find the applicable gas fee. Click “Confirm” to complete the purchase. After completing the transaction, you can view the NFTs in your wallet by returning to your profile page and clicking “In-Wallet”.
Make an Offer (Auction)
After reviewing the auction details and bids from other interested buyers, locate the NFT you wish to buy in the auction and click the ‘Bid’ button. Note that the new bid must be at least 5% higher than the NFT’s current bid to be accepted.
The Actual Purchase
Click Buy Now to checkout. You will see the details of the NFT, such as name, the specific collection, subtotal and total. Click Confirm Checkout.
Next, OpenSea loads your MetaMask wallet.
Here you can see all the details of your purchase, such as the estimated gas fee and the processing time of the transaction.
You can change the gas fee by clicking edit, but remember that lowering the gas fee will slow down transactions significantly. The best time to buy with MetaMask is when the Ethereum network is not too busy.
Check out the Ethereum Gas Tracker on Etherscan to see the current gas costs. You can also check recommended gas prices on ETHgasstation.
When you’re ready to purchase, click Confirm and wait for your purchase to be processed. In just a few seconds, your brand new NFT will appear in your collection. Just go back to your profile and wait for your new NFT to appear.
Sell the NFT
If you want to sell, click on “Sell” in the top right corner, and you will be taken to a new page to fill out the terms of sale.
Choose whether you want to sell at a fixed price or a timed auction, as well as the currency and expiration date for sale. Listings are free, but OpenSea charges 2.5% of each sale.
If you want to see your NFT in the MetaMask wallet and it doesn’t show up, don’t worry; it’s not that it doesn’t exist – you’ll have to add it manually.
First, click on your NFT and scroll down to the details.
Click on the contract address in this section – this will take you to the Etherscan page for your NFT specific address.
Copy this address and return to your MetaMask wallet. At the bottom you will find the option “Import Token”. Click here and select Custom Token. Paste the address you copied from the Etherscan page.
The token symbol is just a public name identifier, and the token decimal point is just a way to display your NFTs. This does not change the amount you hold. For example, if you choose 3, you get 0.001. In this case we enter 0 and keep adding it.
Now you can see your NFT under your balance.
Investing in NFTs on OpenSea is not as difficult as you might think. However, be aware that there are many scammers in this space and prices can be very volatile.
It’s not uncommon for people to lose money to scammers through phishing or carpet pulling. The NFT space is also full of fake traders who generate fake volume on certain collectibles to make them more attractive to investors.
Regardless, it’s important to remember that this is a very young market and is highly unregulated in most jurisdictions. Therefore, it is necessary to approach it in this way and take the necessary precautions to protect your funds.