Created in 2012, Colored Coins are considered the first step towards Non-Fungible Tokens (NFTs). We discussed that NFTs aren’t actual cryptocurrencies but instead tokens on a blockchain that represent ownership of a digital creation like art, collectibles, or even real estate.
What makes them non-fungible is that NFTs are unique, distinguished from one another by metadata, limited in quantity and not interchangeable; they can function as proof of authenticity and ownership.
To create your own NFT, you’ll need to:
Have the digital asset that you own the rights to which can be a custom painting, picture, music, video game collectible, meme, GIF, or even a tweet.
Create an account on the marketplace you wish you to use such as OpenSea, Axie Marketplace, Larva Labs/CryptoPunks, NBA Top Shot Marketplace, Rarible, SuperRare.
Make sure you have a digital wallet to fund your project and pay the gas fee, a payment made by the user to compensate for the computing energy required to process and validate transactions on the blockchain. Popular wallets include Metamask and Coinbase Wallet. Minting an NFT can be free, but can cost between $10 to $100, depending on the chosen marketplace.
Follow the NFT platform's instructions. Each marketplace has instructions creators will need to follow in order to create a Non-Fungible Token.
After uploading the digital item, choose whether to mint a single token or a collection.
The final stage in the NFT minting process is to decide how you want to monetize your NFT. Do you want to sell it at:
- A fixed price: You’ll allow the first person willing to meet that price to buy your NFT.
- A timed auction: You’ll set a time limit for those interested to submit their final bid.*
- An unlimited auction: You have control to end the auction whenever you want.*
* For auctions, you'll need to determine the minimum price. Set your royalties to continue cashing in on your NFT if it resells on the secondary market. Keep fees in mind when setting the minimum price because you could lose money on your NFT sale if you set the price too low.
Depending on the platform and pricing, you could pay a listing fee, an NFT minting fee, a commission on the sale, and a transaction fee to transfer money from the buyer's wallet to yours. Fees also can fluctuate due to the volatility in cryptocurrency pricing. It’s important to take a close look at the costs you'll have to pay to make and sell your NFT to make sure they're worthwhile.
Once done, promote your NFT to your potential collectors. Share the link to your creation on sites that have established communication channels for the crypto community like Twitter, Discord, and Reddit. You’ll establish a reputation and improve general awareness.
Here’s my first NFT which was created with a piece made from my book, Color Your Word! A Creativity Outlet for Nerdy Adults.
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