The Beginners Guide to Buying your First NFT
Everything you need to know to buy your first NFT with absolutely no previous experience required.
Time required: ~20 minutes
You’ve heard all the buzz about NFTs — from Jack Dorsey selling his first Tweet for $2.9M to a 12-year old earning $250,000 from selling cartoon whale NFTs. You’ve even heard stories about collectors who flip NFTs for a $20,000 profit after only holding them for a day. Or maybe an artist you like just announced their first NFT sale, and you’re trying to figure out how to get involved.
Whatever brought you here today, we’re going to explain everything you need to know as a beginner buying your first NFT…and we’ll do it in the simplest way possible!
Topics covered:
- Know what you’re buying 👩🏫
- Create a crypto wallet 💼
- Add funds to your crypto wallet 💸
- Find an NFT you want to buy 🖼
- Understand the type of sale 🛍
- Purchase an NFT 🌟
- Show off your NFT 📣
1. Know what you’re buying 👩🏫
Before you buy something, it probably helps to know what you’re actually buying. So here’s the way you can explain it to your grandma. An NFT is a unique digital piece of art whose ownership is never in doubt since every sale is permanently recorded online. Simple right?
Anything can be an NFT. Whether it’s a beautiful 3D generated landscape, a cute pixelated cartoon corgi, or maybe even a painted rock. There are even NFTs being made by sports leagues like the NBA as well as musical ones from top artists like Calvin Harris.
When you buy an NFT the transaction gets recorded on the “blockchain.” 🙌 You can think of the blockchain as the world’s smartest record-keeping system, because it essentially is.
You can visually see the blockchain in action when you look at the history of any NFT. In the example below, you can see the moment the artist created or “minted” the piece, when they listed it for sale, and when it was purchased. Future sales will also be listed here.
Summary: NFTs are unique pieces of art whose ownership is recorded through the blockchain.
2. Create a crypto wallet 💼
You understand what an NFT is and you want to get to the fun stuff! Well, the first thing you’re going to need is what’s called a crypto wallet. This will not only be the place where you store your cryptocurrency such as Ethereum, but it will also become your online identity where you share your NFTs.
One of the most common Ethereum based cryptocurrency wallets used is MetaMask. It works as both a browser extension and a mobile app. Many people choose to use MetaMask because it is one of the most widely accepted wallets online and it works smoothly with NFT marketplaces such as OpenSea and Rarible.
If you already have a crypto wallet, you can move on to the next step.
How to Install MetaMask
*If you prefer a video demonstration, check out MetaMask’s installation guide here
- Visit https://metamask.io/
- Click the “Download Now” button.
- Decide whether you’d like to download MetaMask on your browser or on your phone.
- In this case, we will install it as a browser extension on Chrome. Click “Install MetaMask for Chrome.”
- Click “Add to Chrome” and follow the instructions to install the extension.
- After adding the MetaMask extension, MetaMask will appear in your browser. Click “Get Started.”
7. From here you will select “Create a wallet.”
8. A data sharing option will show up. This is completely optional and up to you. Your choice will not impact your usage of MetaMask.
9. Create a password. Please use a good password. We hope you’re using a password tool like 1Password or LastPass to create unique passwords.
10. MetaMask will now teach you how to secure your account. Their explanation is so good we’re copying it here:
What is a recovery phrase?
Your recovery phrase is the “master key” to your wallet and funds.
How do I save my recovery phrase?
- Save in a password manager
- Store in a bank vault.
- Store in a safe deposit box.
- Write down and store in multiple secret places.
Should I share my recovery phrase?
Never, ever share your recovery phrase, even with MetaMask! If someone asks for your recovery phrase, they are most likely trying to scam you.
That last part is worth repeating, NEVER SHARE YOUR RECOVERY PHRASE.
11. MetaMask will now give you your Secret Recovery Phrase. You can click to reveal this. Once you do, write it down in whichever secure way you’ve chosen.
12. MetaMask will then ask you to confirm you’ve stored your secret backup phrase correctly by asking you to place the words in the correct order. Simply click the words in the order they appear for your phrase.
13. You’re done! You should now see your MetaMask account which will look like this. We’ve highlighted 3 elements that you should be familiar with here.
1. This is your Wallet Address. This is the equivalent of your username. You can send or receive crypto assets at this address. All your transactions on the blockchain will use this address.
2. This is only as secret as you would want your username to be. But to buy or sell NFTs, people will be able to see your wallet address.
3. This is your balance in Ethereum. You can change the line below to appear in your local currency if you’d like. You can use the “buy” button to purchase Ethereum from one of the third-party solutions that MetaMask supports such as Wyre which lets you use your debit card. We’ll discuss more options to fund your crypto wallet in the next step.
Summary: You now have a crypto wallet set up. This will serve as the place you store your crytpo currency as well as NFTs. It will also be your username in the crypto world.
3. Add funds to your crypto wallet 💸
You know what NFTs are and you’ve got your first crypto wallet setup but to buy an NFT you need something to pay with! You’re crypto broke at the moment, so let’s fix that.
The fastest way to get funds into your MetaMask account is going to be to use one of the built-in options in the previous section, such as Wyre, which will allow you to use your debit card to purchase Ethereum. However, this is not often the most cost-effective way.
Many people choose to use a specific cryptocurrency exchange since they typically have better service fees. You can use reputable cryptocurrency exchanges to buy Ethereum such as Coinbase (available in most countries) or Netcoins (only for Canadians). Both of these platforms are trusted by many in the cryptocurrency space but it’s always good to do your own research.
What you’ll need to do is:
- Create an account.
- Deposit some traditional currency (USD / EUR / CAD) in your account.
- Convert your traditional currency into Ethereum.
- Transfer your Ethereum from Coinbase or Netcoins to your MetaMask wallet.
These platforms have really great guides to get you started. So instead of duplicating them, we’re just going to recommend you check out their pages:
What is Ethereum and why do you need some?
We’ve said Ethereum a few times so it’s probably about time we explain what it is! Ethereum or “ETH” (pronounced E-th) is the second-largest cryptocurrency after Bitcoin. The basic difference between Ethereum and Bitcoin is that with Ethereum, you can create contracts between two parties and sign the contracts all on the Ethereum blockchain. That’s why developers choose Ethereum to build their crypto applications. Today most NFTs are bought and sold using Ethereum and that’s what this guide is using.
Summary: Congratulations! You’re no longer crypto broke. You have some ETH in your MetaMask crypto wallet.
4. Find an NFT you want to buy 🖼
It might seem silly to say that you need to find an NFT to buy in a guide about buying NFTs, but it can sometimes be tricky to find one when there are millions of choices! With so many ways to find NFTs, we want to share some of our favorite ones with you.
Using an NFT Marketplace:
You can use an NFT marketplace such as Rarible, OpenSea, or Foundation.
Twitter:
Twitter is the main social media network for the NFT world. There are tons of NFT accounts and hashtags you can follow for inspiration. One of our favorite hashtags is #NFTThailand where you can see art created by people from Thailand. Other popular hashtags are #NFTCommunity, #NFTArtist, and #NFTCollector.
On Twitter, you’ll also often see threads like this where someone says they’re looking to buy an NFT and for people to drop suggestions in the comments. These threads typically get 200+ replies so you can scroll through them to look for something you like.
Seeing someone else’s collection:
You can often get inspired by seeing what’s in another person’s collection. For instance, here is billionaire Mark Cuban’s, and here is the cocoNFT collection.
Buying creator’s Instagram posts:
You can browse the NFTs for sale here that come from Instagram creators. These NFTs have been created using the cocoNFT app (That’s us!).
Summary: You understand how to search for and find NFTs and you have a piece you’re interested in buying.
5. Understand the type of sale 🛍
Just like in real life, there are different types of sales. Sometimes you can buy a good for a set price, other times it might be at an auction. Here are some of the most popular sale types with NFTs:
Buying for a set price
This is the most straightforward way to purchase an NFT. In this case, an artist or a collector has set a fixed price for their NFT. You simply agree to pay them that amount of ETH for their NFT.
Dutch auction
In this type of sale, you purchase the NFT for a set price but the price declines as time goes on. You can typically see what the starting price was and what the lowest possible price will be. Anyone at any time can pay to purchase the NFT at the current price. It’s kinda like a game of chicken with all the other buyers.
A quick note about WETH
The next 3 purchase types (time-bound auction, unlimited auction, and unsolicited offers) all use WETH (Wrapped ETH) instead of ETH. The main difference between the two is that WETH can be used to fulfill a purchase at a later date without any further interaction by you.
WETH and ETH have the same value. You’ll need to convert some of your ETH into WETH to buy an NFT with these purchase types. Marketplaces like OpenSea and Rarible allow you to convert between the two currencies easily.
Time-bound auction
This is the eBay auction model. There’s a set amount of time and when there’s no time left the highest bidder wins.
Unlimited auction
This is like the auction you think of when you picture a fast-talking auctioneer. Every time a new bid is added the time on the clock gets reset to something like 60 minutes. Once the time finally runs out the highest bidder wins. Just beware that you might need to push your bedtime with this type of auction.
Making an unsolicited offer
Lastly, you can usually make an unsolicited offer to buy an NFT from someone. This is like you walking up to a stranger on the street and offering to buy their pen. They might not be looking to sell the pen, but hey, everything has its price, right?
Minting directly from a drop
One last method to buy an NFT is to participate in a collectible drop. These are usually projects that create ~10,000 NFTs all with the same theme and launch them at a specific date and time. There’s usually a set price per piece and you can buy them in bulk with only one transaction. You can see some upcoming drops here.
Keep in mind, drops can be highly competitive and result in gas wars. You can also end up with a failed transaction which is when your purchase order doesn’t get confirmed on the blockchain. In this situation, you lose the gas fee and don’t get an NFT. If this sounds a bit intimidating, it’s probably best to observe one or two drops before participating in one.
Summary: With knowledge of how various sale types work, you’re ready to press that buy now button!
6. Purchase an NFT 🌟
You’ve got your crypto wallet with ETH in it, you know which NFT you want to buy, and you understand the sale type, so let’s get to it!
The instructions below are going to be for the most common sale type where you’re buying an NFT for a set price. However, the flow is very similar for all other sale types.
Steps to purchase an NFT:
Purchasing an NFT has four steps that we’ll go through below:
- Sign up for an account by connecting your wallet.
- Click “Buy Now” and review your order.
- Sign the transaction in your crypto wallet.
- Wait for your transaction to be confirmed on the blockchain.
1. Sign up for an account by connecting your wallet
Before you can buy something from a marketplace, you need to create an account by connecting your crypto wallet. Keep in mind that your wallet address is your username, so you connect that address to establish your username on that website. You’ll want to select the “Sign In” option on MetaMask which will then pop open the extension where you can select your wallet and go through the two steps to confirm the connection.
2. Click “Buy Now” and review your order
When you finally click that “Buy Now” button you’ll be met with a bit of a different experience depending on the platform. Essentially, you’ll be able to review the order before it’s sent to your crypto wallet for authorization. We’ve included screenshots below from both OpenSea and Rarible.
3. Sign the transaction in your crypto wallet
Once you review the order and click the last checkout button you’ll need to sign the transaction from your crypto wallet. This is needed for every transaction. You’ll see a screen like the one below appear.
What are gas fees?
One thing you’ll notice is a section called “Gas Fee.” Every transaction on the blockchain essentially gets confirmed by other computers. The gas fee is the money that those other computers get for confirming your transaction. This fee can fluctuate wildly — from $17…and upwards of $700 at times (yes, we’ve actually seen this!). Gas fees can be frustrating when you’re first getting started but you can use tools like this to see what gas fees are at this exact moment.
- It’s worth noting the higher the gas fee you submit, the faster your transaction will be confirmed. This is why for really hot drops you hear about “gas wars.” This is when people are putting in high gas values to try and buy the NFT first. You can adjust the gas fee on your MetaMask transactions by clicking the edit button.
4. Wait for your transaction to be confirmed on the blockchain
As soon as you press the confirm button on your MetaMask transaction you’ll now see that there’s a record in your activity that says “Pending.” Your order is now off to the blockchain for confirmation! You can click into it and then see your transaction on Etherscan. Erherscan is like the all-knowing librarian for the Ethereum blockchain. It’s a convenient way to see all the details about every Ethereum transaction.
Usually, it takes no longer than 5 minutes but if gas fees are erratic it can take longer. If you run into issues with it taking longer than you want, MetaMask has these instructions on how you can speed up or cancel a pending transaction.
Summary: You’ve purchased your first NFT!
7. Bonus Round! Show Off your NFT 📣
Once your transaction is confirmed on the blockchain, you’re the proud owner of your very first NFT! Now it’s time to show it off to friends, family, and strangers on the internet!
Some of our favorite beginner-friendly tools to show off our NFT Collection:
- Twitter — This is the main social media network for NFTs. We love sharing NFTs we buy here, and we always try to mention the artist. You can also mention us if you found this guide helpful. @cocoNFT
- OnCyber — This is a very simple and free tool to showcase your NFTs in a 3D gallery. You can share your gallery link with anyone and they can see the awesome NFTs you own.
- Rainbow — This is a popular crypto wallet, but you can also use it to share your NFTs by adding your wallet address to the end of the URL.
- Lazy — Another NFT gallery tool. This one was made popular by Mark Cuban.
Summary: You’re now an NFT pro and you’re sharing your collection with the world!
