Before proceeding with the purchase of your first, some steps are necessary:
We will explain in this chapter how to buy an NFT on the Ethereum blockchain using Metamask. Depending on the wallet, exchange, or marketplace some aspects of this tutorial may vary but the process will be very similar on other platforms.
Here is how to use Metamask as a reference for this step-by-step guide to properly create your wallet:
Several versions of Metamask are proposed depending on the device you wish to install it on. Choose your preferred device and select “Install”.
Make sure you are on the authentic Metamask page. Please see the screenshot below as reference:
Once you’re sure it’s the correct page, install Metamask on your device.
A strong password contains at least 15 characters, including at least one uppercase letter, one number, and one special character. The longer it is the better!
Upon creating your wallet, Metamask assigns a seed phrase or backup phrase to it. This seed phrase is a series of words that will rarely be needed but are the ‘keys’ to your wallet.
Do NOT share your seed phrase with anyone!
If someone discovers your seed phrase, they’ll be able to access your wallet and all your assets.
Now that your crypto wallet is created, it is now possible to interact with decentralized applications (Dapps) such as the NFT marketplace Decentraland. But to buy an NFT, you first need to buy some cryptocurrencies to cover the cost of the transaction.
As we explained in the Fees chapter, in order to send transactions for buying or selling NFTs, minting them, or even creating new smart contracts, cryptocurrencies are needed. In this chapter, we will only focus on the two easiest methods to buy some ETH (Ethereum currency): buying from a centralized exchange platform or buying directly from Metamask.
With these two methods, you will be asked to follow the ‘Know Your Customer’ (KYC) procedure during your registration. You will be requested to provide an ID depending on the platform, this manual identity verification might last from a couple of days to a few weeks.
Since the creation of Bitcoin, many centralized exchanges (CEX) have been created to buy cryptos with fiat currency. Today, the most used and secured exchanges are compliant with international regulations and can freeze accounts in case of malicious activity.
Here are the three main Exchanges to buy your first cryptos using Credit Card or wire transfer:
During the registration process, you will be guided step-by-step to create and fund your account. Once you have traded the fiat for some Ether, it is time to withdraw them to your wallet. Open the Metamask plugin and click on your account name.
This action allows you to copy the address that will receive the funds on the clipboard. Go back to the withdrawal page of the chosen CEX and paste the address when asked. Confirmation should be asked and the transfers usually take around 10 minutes.
In 2021, Metamask and Wyre made it possible to buy $ETH directly through the wallet using a credit card. One year later, it is possible to use MoonPay, Transak and Apple Pay as well. To proceed, click on the ‘buy’ button.
Choose your provider and follow the registration process to proceed with the payment. Depending on the platform used and the amount of the transaction, the fees might vary. Also, some payment limits can occur depending on the ‘Know Your Customer’ (KYC) level put in place by the platform.
Once the transaction is complete, you will be redirected to a confirmation page and the $ETH should be transferred to your wallet shortly after.
Once these steps are complete, all that remains to be done is to select your marketplace (if you’re not sure which one would suit your needs, you can read our rMost Popular NFT Marketplacesr chapter) choose the right NFT, and buy it.
In its most decentralized version, the user can be fully responsible for every action, from creating a wallet to buying an NFT from a decentralized NFT marketplace. The user owns the private key of his wallet and can transfer the NFT.
Conversely, some marketplaces centralize everything. When creating an account with a login and password, the marketplace will generate a crypto address associated with the account. Owning crypto to buy an NFT will not be mandatory and the user will not have the opportunity to access the private keys of his wallet. The NFT marketplace will handle everything from A to Z.
Of course, there are in-betweens. For example, on Nifty Gateway, it is possible to buy an NFT directly with a credit card. To buy an NFT with crypto, a deposit on the wallet generated by the marketplace will be needed.
In order to sell the NFT on Nifty Gateway, a profile verification (the ‘Know Your Customer’ (KYC) process as mentioned above) will be required… and to sell the NFT on another marketplace, it will then be necessary to ’claim’ the NFT before taking out of the marketplace.
Today, buying your first NFT has become very simple if the purchase takes place on centralized platforms like Binance, Crypto.com, FTX, and Coinbase NFT. If the purchase is done in a decentralized way, it will require a few more steps but will ensure you better control of your NFT.
Here again, the perfect balance between security, decentralization, and scalability has not yet been found. Each method of purchase has its advantages and disadvantages, a good indicator to determine your preferred method is to assess the retention time of your NFT.
If you plan to hold your NFT for a long time, it’s preferred to focus on a decentralized marketplace that cares about the longevity of your asset (using IPFS and on-chain metadata hosting). If you plan to flip your NFT very quickly, a centralized exchange will be more suitable because it will have a lower fees and will be quicker to trade on it.