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how-to-buy-an-nft

The Metaverse: Everything I Learned on How to Buy an NFT

April 12, 2022/0 Comments/in Cryptocurrency /by Wallet Squirrel

Now that we got that out of the way, let us jump into how I went about hunting, researching, and finally purchasing an NFT. I spent months searching for a project I believed in enough to make an investment. There were also some mistakes made along the way.Before we even start talking about how to buy an NFT, I have something to get out of the way. While I have learned TONS of vital information about the NFT world, I am not an expert in the NFT world. This world is very complex, broad, and sometimes scary. Please before jumping into any project, do your own research and due diligence.

Now that we got that out of the way, let us jump into how I went about hunting, researching, and finally purchasing an NFT. I spent months searching for a project I believed in enough to make an investment. There were also some mistakes made along the way.

This is your chance to learn from my mistakes.

The Hunt

Many months ago I started researching the metaverse and NFTs. After my research on what the heck NFTs are, I decided I wanted to buy one. The next question I needed to answer was, “What kind of NFT do I want?”

As I mentioned, the NFT world has a lot going on right now. There are so many different genres and types of NFTs. I had no idea how complex this would be.

  • Artwork (JPEGs)
  • GIFs
  • Gaming
  • Collectible Items/Trading Cards
  • Music and Media
  • Virtual Fashion/Avatars
  • Real-world Assets

Utility Is a Must

One thing I knew was a must, was my NFT had to have utility. This means if I was to buy a JPEG, it had to provide more than just colored pixels. The NFT had to also provide real value on top of looking pretty. An NFT with utility can mean a lot of different things. Some give you voting rights within the project to help direct the project’s next steps or some give you access to real vacation homes (like a timeshare).

As time goes by, the utility can get bigger and better as well. That is why it is nice to be part of a project that has voting rights. Other utility projects can gain you real cryptocurrency that can be exchanged for USD. There is a whole wide world of really neat utility out there.

Where I Landed

As I mentioned earlier, I spent months trying to find the perfect NFT project for me to buy into. I looked at hundreds of different projects within the different types of genres I listed above. During my search, I kept a shortlist of projects that I liked. One night while I was reviewing, I noticed ALL but one of the projects on the list were gaming-related. As a gamer, it made sense that I would be attracted to these types of projects.

Having a passion for games made it an easy choice.

Finally, I had an NFT type to focus on. I was now excited to start digging into the projects.

Due Diligence

I started doing my due diligence on how to buy an NFT. I went through each gaming project one by one looking at various items.

  • Project Roadmap – Is it clear with a vision, complete, and has realistic goals?
  • Doxxed Team Members – Is the team anonymous or not? Could you do research on the team and previous projects?
  • Team Actions – How has the team performed so far? I think of this quote, “It’s not what you say that defines you, it’s what you do.”
  • Community – Is there a positive, realistic, active, and large community around the project?
  • White Paper or Articles – Has the team released a white paper or articles explaining the project?
  • AMA’s – Has the team done talks about the project on Discord or Twitter Spaces? How do I feel about the project after listening to the project?
  • Utility – Does the NFT have value beyond the pixels?
  • Cost – Does it fit within my budget?

This took a while but at the end of my research, I found a project that I really believed in, Troverse.

https://walletsquirrel.com/wp-content/uploads/2022/04/3hoofCT-Imgur.mp4

Why I Liked Troverse

Troverse is an open-world survival space game that has tons of potential to grow into something special. The possibilities for NFTs are endless such as voxels, space suits, ships, buildings, etc. The best and most valuable NFTs were put on the market first though, the planets. Troverse minted 10,000 unique planets that build the foundation of the game.

Here is what I saw in Troverse while going through my due diligence list.

  • Project Roadmap – The roadmap is complete even though there are some large gaps between the planet mint and the alpha release of the game, Q1 2022 to Q3 2022.
  • Doxxed Team Members – The team is partially doxxed and they have previous work released on Steam.
  • Team Actions – The team has always followed through with their words. In fact, they tend to outperform expectations. This gives me the impression the team is very smart, innovative, and creative.
  • Community – There is an awesome Discord community that is very engaged and supportive.
  • White Paper or Articles – There is no white paper yet which is somewhat concerning. The reason given for this is they are still putting the finishing touches on the gameplay. Not releasing the white paper allows for more flexibility to fine-tune things in case they find an issue with play.
  • AMA’s – Yes, the developers have done several AMA’s and I liked what they had to say.
  • Utility – Each planet owner can earn real income from the game. When someone mines minerals on your planet, you get a portion of those minerals that you can use for trading, selling, or building other NFTs.
  • Cost – The cost for me was a little pricey but I had the funds. I believe in the project long-term.

A lot of NFT projects end up being flipped quickly. This is not the case for the planets within Troverse. They are the initial NFT for a very large project that is going to take time to get fully developed, the beta release is Q4 2022. For a traditional investor nine months seems like nothing but in the NFT world, this is a LONG time!

I believe Troverse will be a pioneer in the NFT gaming space.

How to Buy an NFT

Mint

Minting is the release of a brand new NFT or NFT series into the market. I like to think of a mint similar to when a new music album is dropped. The major difference is that NFT projects have a very limited supply such as 200,000 unique tokens or as low as 888.

So how to buy an NFT by minting? Well most importantly, you need to get to know about the project before it is ready to mint. Why? Because a lot of the high-demand projects can sell out within minutes. For example, the Azuki project sold out in four minutes!

Getting in at Mint can be very tough. Because of the high demand, most projects have a whitelist (WL) that you need to be on in order to get in on the mint. Basically, the project will allow the people who got WL to mint (buy) the NFT first at the mint price. There will be a timeline for this buying phase which afterward, they will open it up to the public. In my experience, you do not want to be part of this public mint as thousands of people will be trying to purchase the last 200. This can make GAS fees skyrocket (more on this later)!

While WL makes sense, I hate it. To get WL for most projects you need to grind to gain status within a Discord channel or get lucky in a giveaway on Twitter. I tried to grind once then realized why am I working so hard for a project that should be trying to win me over.

This is one reason why I loved Troverse. Sure, yeah, they had the grinding for the WL but those people got the second pick. Troverse set aside 7,000 planets for a public reverse dutch auction. Then they did the WL mint phase with 2,700 planets. Anything that remained went to a general public mint. The reverse auction was something new that no one else had ever done (though a lot of projects are now copying the idea).

Learn other terms for the metaverse in our Metaverse Glossary.

Second Market

Unfortunately for me, I found Troverse too late and missed the public auction. For me, if I wanted to invest in the project, I had to buy a planet on the second market. The two most popular markets are Opensea and Looksrare. Here you connect a cryptocurrency wallet such as Metamask.

There are several ways to get crypto into your wallet. Metamask allows you to deposit using a debit or credit card ($30-$40 fee). Or you can purchase cryptocurrency using Coinbase or Binance and then transfer those funds to your wallet. I opted for the latter because at the time it was cheaper ($5 Coinbase fee + gas fees for the transfer). Now with funds in your wallet, you can use them to purchase any NFT you can afford.

In the current NFT market, purchasing on the secondary market is usually more expensive. For me, my planet cost triple what the mint price was. It turns out I could have waited a couple of days to get a cheaper price but that’s okay. The price could have gone up instead.

https://walletsquirrel.com/wp-content/uploads/2022/04/tjSjx7Q-Imgur.mp4

Lessons Learned

Yes, I made a stupid mistake when I was learning how to buy an NFT (more about that next) but I have also learned a lot from others as to what you need to watch out for. The NFT world is booming right now. A lot of people are making a lot of money during this boom. This boom will also attract some people trying to take advantage of people. This is something you need to watch out for.

Rug Pulls (Scams)

A rug pull is when the person behind a project simply vanishes after the mint. They take all of the resources with them and you lose everything even the NFT that is supposed to be yours.

I had this happen to me with a GIF project called, Invisible Doodle Friends. For fun, I wanted to get into a low supply project with the remaining $100 I had leftover after purchasing my Troverse planet. I found the doodle project on Twitter, it looked legit (they always do). I made the mistake of letting FOMO settle in because they were minting right then and the price was perfect. After five minutes of research, I decided to mint.

The rug pull didn’t happen for another few days after they did the reveal and the GIFs were just JPEGs. After word got out about it being a scam, the creator pulled the rug from underneath the 2,222 people that purchased.

For me, I only lost $60. I came out with an awesome learning moment to share with you as well.

Liquidity

Remember, NFTs are not liquid investments like stocks or most cryptocurrencies. You need to find a buyer which can take a while. This was something I didn’t think about until I started getting deep into my research.

Bad Teams

There are teams out there that are not scammers but they are not good developers or project managers. Before purchasing, do as much research on the project’s team members as you can.

One competing space project to Troverse did their reveal a few months before Troverse. The results were not good. The graphics ended up being horrible and the value of the project tanked.

High GAS

GAS is the cost to process the calculations to complete your transaction on the blockchain. When there is a lot of demand, the prices go up. If you are trying to compete to get one of those last 200 NFTs in a mint, the price of GAS is going to skyrocket. Be prepared to speed a lot of extra money just for that mint.

Oh yeah, if someone beats you out with a higher GAS price, you still lose your GAS money. You do not get it back. Pretty silly, right?

Unless you are very experienced with how to buy an NFT and have good funds, I would avoid these bidding wars. There are a lot of very large whales out there.

Concluding How to Buy an NFT

Overall, the NFT world is a very fun place. It is perfect for those people who enjoy collecting and flipping/trading items they have collected. I once heard that the NFT world was the perfect place for sneakerhead collectors.

I am glad I jumped into the space. It is something that interests me and I would kick myself if I didn’t give it a try. My adventure hasn’t been perfect and neither will yours be. That is okay. Sometimes it is okay to make mistakes as long as you learn from them.

I don’t think I will be putting more money directly into NFTs though. My issue is with the lack of liquidity NFTs don’t have. I want my investments to have a little more liquidity. I still want to invest in some more gaming projects though so I will find ones that have a coin that I can purchase such as Star Atlas or Axie Infinity.

Wallet Squirrel

Wallet Squirrel is a personal finance blog by best friends Andrew & Adam on how money works, building side-hustles, and the benefits of cleverly investing the profits. Featured on MSN Money, AOL Finance, and more!

www.walletsquirrel.com/
metaverse-terms-you-should-know

The Metaverse: Terms You Should Know to Get Started

January 11, 2022/0 Comments/in Cryptocurrency /by Wallet Squirrel

When I started researching the Metaverse late last year, there were several moments when I was completely lost. After many hours of research I have decide to put together a Metaverse dictionary to help us all out learn about this new world. #metaverse #blogging #cryptocurrencyWhen I started researching the Metaverse late last year, there were several moments when I was completely lost. This was because I ran into terms such as minted and DOA that I had no idea what they meant. I am sure I am not the only one so I have created a dictionary of metaverse terms that you should know to get started. 

My goal with this dictionary is to create an easy reference of various metaverse terms to help make our journey a lot easier. Some of the terms are more simple than others. I wanted to create a very robust dictionary that is meant for everybody ranging from the earliest newbie to the more experienced. 

Last thing, as I continue my exploration in the metaverse and stumble upon new terms, I will be adding them here. This list is not static. It will continue to grow. Be sure to bookmark this article so you can use it too!

Did I forget a term? Let me know in the comments below!

Metaverse Terms You Should Know

Augmented Reality – Also known as AR is a digital interactive experience within the real world. Typically this is used to enhance the user’s experience within a game or application. Think of Pokemon Go.

Blockchain – Blockchain is a decentralized ledger that is often stored in blocks that are chained together. Bitcoin and Decentraland are all built using blockchain.

Blockchain Gaming – The games have aspects within them that use the decentralized blockchain. These aspects typically revolve around cryptocurrency or non-fungible tokens. Think Axie Infinity or Sandbox.

Cryptocurrency – A decentralized digital currency that is built using blockchain. Prime cryptocurrency examples are Bitcoin or Etherium.

DAG Technology – To put it simply, Directed Acyclic Graph technology is kind of a competitor to Blockchain. Instead of using and stringing together a series of blocks, DAG does not use blocks. It is a network of individual transactions linked to multiple other transactions which don’t need to be chained together with blocks. This allows for cheaper, more efficient, and quicker transactions. 

Decentralized Autonomous Organization – Also known as DOA, is a form of investor-directed venture capital fund. DAO was launched back in 2016 after a crowdfunding event. It set out to provide a new decentralized business model for organizing various enterprises. (Wikipedia).

Gas Fees – This is the fee that it takes to complete a transaction on the blockchain. These fees are in place because cryptocurrency miners are required to complete transactions by solving complex mathematical problems. The first miner to solve the problem is paid for the use of their resources. This is paid by the gas fee.

Hashgraph – Considered as a competitor to the blockchain, Hashgraph is a distributed ledger technology. Hashgraph is patented so it is not open to use like blockchain. Hashgraph is a more advanced technology compared to blockchain because it is more efficient. 

Internet of Value – A concept that is said to be brought forward by Ripple where value moves and is exchanged freely like information is in the current internet. 

Layer-2 – Layer-2 references a technology or network that sits on top of a blockchain protocol. This is usually done to improve efficiencies and scalability. One example is The Lightning Network. 

Non-Fungible Token – Also known as an NFT is a unique digital item. There are endless possibilities of what an NFT can be. The key aspect of what defines an NFT is they need to be unique, non-fungible. They also need to use a token to verify its uniqueness by using blockchain, DAG, Hashgraph, etc. Some examples include a JPEG of a fish, a piece of clothing in Sandbox, a Satellite in a virtual space game, or even a plot of land. 

You can read more about NFT’s in our What The Heck Are NFTs article.

Meatspace – The real world, planet Earth, that we physically live in/on. 

Mint – The release of a new NFT out into the market is referred as minted. Think of when a new album would drop in stores. 

Rug Pull – When a creator of an NFT simply vanishes off the web. They take all of the resources with them and you lose everything. 

Security Tokens – Security Tokens are digital liquid contracts for fractions of assets that have value. Examples would be stocks, real estate, and even a car. This is an area that the meatspace meats the blockchain market because these contracts are preserved on the blockchain ledger. 

Smart Contract – These are transactions or computer programs that are set to run on the blockchain when predetermined conditions are met. Smart Contracts help remove the middle man because they automate the execution of an agreement. 

Staking/Yield Farming – Simply put, Staking/Yield Farming is when one party lends out cyptocurrency to another party in exchange for interest or other rewards. 

Web 3.0 – The next generation of the internet. It is considered moving to the decentralized metaverse will be the next phase of the internet, Web 3.0. 

Virtual Reality – Also known as VR, is a simulation that immerses the user into the surroundings of the program they are running. Typically the user will wear a headset such as an Oculus for this immersion. 

Other Metaverse Term resources

There is so much in the metaverse that revolves around the blockchain and other similar technologies. If you are hungry for more information, I recommend taking a look at these resources to continue your research. Happy reading!

  • Gemini Cryptopedia
  • Investopedia
  • Coinbase Learn

 

If you are looking for other ways to earn more money each month but the Metaverse does not seem like your cup of tea, then I recommend hopping over to our Ways to Make Money page. Here at Wallet Squirrel, we are all about finding new ways to make money each month to get us to financial freedom. We have compiled a massive list of other ways for you to earn more money.

Wallet Squirrel

Wallet Squirrel is a personal finance blog by best friends Andrew & Adam on how money works, building side-hustles, and the benefits of cleverly investing the profits. Featured on MSN Money, AOL Finance, and more!

www.walletsquirrel.com/

The Metaverse: What The Heck Are NFTs?

December 10, 2021/0 Comments/in Cryptocurrency /by Wallet Squirrel

Seriously though, what the heck are NFTs? Even spelling out what NFT stands for, non-fungible token, doesn't help. In fact, I might be more confused now.Every morning, I hop on Twitter to do some mindless scrolling to see what is important to the Twitterverse today. I mostly get nothing out of this time but sometimes I get some good tidbits for my fantasy football team. Recently though, I have been seeing a lot of tweets about people buying a bored ape NFT or meme selling as an NFT for $500,000. These headlines just keep flooding my news feed day after day and all I can think to myself is, “What is an NFT?”

Seriously though, what the heck are NFTs? Even spelling out what NFT stands for, non-fungible token, doesn’t help. In fact, I might be more confused now.

To continue on with our metaverse series, let’s take a look at what NFTs really are. For me personally, this article really helped me understand what NFTs are. I’m not biased or anything though. 🙂

What Does NFT Stand for?

As mentioned earlier, NFT stands for non-fungible token. Really, this doesn’t help define what an NFT is.

Let’s start at the basics then. Non-fungible stands for, “a unique digital identifier that cannot be copied, substituted or subdivided, that is recorded in a blockchain, and that is used to certify authenticity and ownership” (Merriam Webster).

As an example, something fungible would be a US dollar bill. That dollar bill can be replaced with another dollar bill that has the exact same meaning and value. On the flip-side, something non-fungible would be a plot of land in a neighborhood. Sure all of the land plots are exactly one acre in size but each one is slightly different. One plot might have 20 trees on it when another only has 5.

Lastly, token refers to the blockchain aspect of where NFTs are part of. Most NFTs are built on top of the Entherium blockchain. This token is the unique identifier that records its ownership. Crazy enough, it records and holds all of the ownership history. That’s right, you can hop into an NFT listing to see who has owned it in the past and how much they bought it for. Pretty cool, right?

Copy and Paste Issue

An awkward thing is you can copy and paste NFTs. Back in February 2021 a 10-second clip by Beeple sold for $6.6 million.

Spoiler! You can right-click on that clip and save it to your computer’s desktop.

Wait, what?!?! How is that possible? Well, you can copy a digital file as many times as you want, including the art that’s included with an NFT. Think of this like buying a print of the Mona Lisa. At the end of the day, you might have a copy but it is still not the original.

Think of it this way. Before the blockchain, you could take a JPEG, make a copy of it onto a flash drive, and then copy that JPEG over to your friend’s computer. Those copied JPEGs are the exact same as the original on your computer. There is no difference between them at all. Your friend could take that JPEG and take credit for it. There would be no way to tell that your JPEG is the original. If your JPEG was an NFT tied to the blockchain, you would be able to see that yours is the original plus all of the history for the NFT.

Pretty cool, huh?

Why Are NFTs So Special?

People are treating NFTs as digital collectibles or even virtual plots of land to build virtual buildings on to sell virtual goods from. They are unique pieces of work that cannot be replicated.

NFTs can be:

  • Digital Art
  • Digital Trading Cards
  • Music
  • Virtual Land
  • Tweets (So weird)
  • Memes and GIFs

There are so many more outside of this list such as buying digital clothes for your avatar in Decentraland. I am sure there are so many more ways NFTs will be special that we have not even thought about yet. Personally, I hope they find some better reasons to buy an NFT because I am not going to be buying any digital hats anytime soon.

Where Can I Buy An NFT?

Digital-artwork NFTs are sold on specialty web markets such as Opensea, Rarible, and Zora.

NBA Top Shot is a virtual trading card NFT site while Cryptokitties is a Pokemon-like digital collecting app.

You can also jump into a virtual world like Sandbox or Decentraland to find all of the above plus real estate or collectibles for your avatar. Even in some virtual worlds, you can buy a spaceship! So cool!

Another thing is you don’t have to buy an NFT directly to invest in them. Some of these virtual worlds have their own cryptocurrencies that you can invest in outside of the world. For example, Decentraland has the coin MANA and Axie Infinity has the coin AXS.

Can I Even Do Anything With My NFT?

Good question. What can you do with an original piece of digital art? Well, some people are printing them and hanging them in their house or office but that would not be the original. To display the original like an art gallery you can use a digital screen. The wild thing is we are starting to see physical galleries display NFTs instead of traditional art. But you are also seeing virtual NFT art galleries pop up in virtual worlds like Decentraland.

Remember NFTs are more than just art pieces. People are buying virtual land, an NFT, to build NFT shops so they can make more money. Recently, a company bought land in Decentraland for over $2 million so they can create a virtual clothing store to sell for people’s avatars.

To me, this just blows my mind!

For many people, the appeal is to buy and sell items. I look at this similar to trading cards or rare coins. People are buying NFTs at low prices and taking advantage of the current climate to sell them at higher prices.

What’s Next?

This is the million-dollar question. Well, trillion-dollar question. Where will these NFTs end up in several years? Will they go to the wayside with your beanie babies? Or will NFTs become a new normal for buying art, music, collectibles, or something completely new that we can’t even imagine yet?

Personally, I think we are just in the beginning with what NFTs and the metaverse can become. It will be fun to see where this technology goes in the next five years. I see there is a lot of opportunity for growth and innovation.

The real challenge is to find where that growth and innovation are going to come from.

Wallet Squirrel

Wallet Squirrel is a personal finance blog by best friends Andrew & Adam on how money works, building side-hustles, and the benefits of cleverly investing the profits. Featured on MSN Money, AOL Finance, and more!

www.walletsquirrel.com/

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