What is NFT and How Your Business Can Use It?
You must have heard the word NFT. And you want to ask about the meaning of NFT. You may get a simple definition of NFT from the internet. But, you will only get its essence when you fully understand how it functions.
But first, let’s talk about all the buzz around these tokens. We all hear news about the most expensive NFT sold in a year. The very first NFT came along in 2014. And then we saw successful NFT projects such as Rare Pepes, CryptoPunks, and CryptoKitties. NFT sales have reached new heights and a lot of popular NFTs are sold for millions of dollars.
If you still don’t understand what NFT is and also want to invest in NFTs, this article is for you. We will dive deep into NFTs, how they function, and how they can be sold or bought.
What is Crypto NFT?
NFTs are digital assets that signify real-world items such as music, art, videos, and in-game objects. You can purchase and sell them on the internet usually with cryptocurrency.
They are usually encoded with the same basic software as various cryptocurrencies. From art and songs to toilet paper and tacos, NFTs sell like hotcakes.
NFTs are more popular now as they are widely used to purchase and trade digital artwork. In 2021 alone, the market for NFTs jumped to an astounding 41 billion dollars. This number is very close to the total worth of the whole global fine art industry.
Is NFT Permitted in UAE?
It is complicated. Before we dive deep into the legal ramifications of NFTs in the UAE, first understand that an NFT token is not the item it refers to.
Every United Arab Emirates mainland market, the Dubai International Financial Center, and the Abu Dhabi Global Market have different sets of rules for crypto assets, subject to the real business use of such virtual assets.
Though Bitcoin is sanctioned in the UAE, the authorities allow citizens to buy and sell it. Citizens can buy, trade, and keep BTC in this manner. However, they aren’t allowed to purchase anything else with it.
NFT Artwork Sector Gets Security
VARA or Virtual Asset Regulation Authority is the newly created authority in Dubai. It will craft a progressive legal framework to secure investors and artwork international standards to monitor NFTs, crypto, and digital assets.
Dubai government has recently announced the virtual asset regulation law which is foreseen to increase selling volumes in cryptocurrencies. And the VARA will regulate, monitor, and oversee NFT trading and virtual asset services.
Businesses that are actively taking part in the local NFT art and cryptocurrency industry have welcomed this step.
What Are Crypto Exchanges and NFT Marketplaces?
A crypto exchange or a cryptocurrency market is a place where people can purchase and sell cryptocurrency. They can trade one form of digital currency for another like trading Bitcoin for Litecoin. Or they can purchase cryptocurrency using fiat currency like the US dollar.
An NFT marketplace is an online medium for selling and purchasing NFTs. It enables users to save and show their NFTs as well as trade them with other people for cryptocurrency or regular currency.
How to Invest in NFT?
You must create an account with a crypto marketplace to buy and sell NFTs. Most NFTs are based on Ethereum therefore a lot of crypto marketplaces only allow ETH tokens to give in payment.
Users can buy Ethereum from your crypto marketplace. They don’t need to purchase a complete Ethereum as they can purchase parts and fractions. ETH tokens are kept in a digital wallet.
There are a lot of NFT marketplaces. OpenSea is among the leading NFT markets. To buy NFT here, users need MetaMask.
What is MetaMask?
Metamask refers to the best crypto wallet that lets users buy their tokens quickly. To buy NFTs, they need first to install MetaMask on their browser.
You can easily create your MetaMask wallet on the OpenSea website. Don’t forget to connect your MetaMask wallet with a suitable OpenSea account. Then follow these steps to proceed further.
- Click on the MetaMask symbol located at the top right corner of your browser window to buy ETH. If you possess ETH in your digital wallet, then select <Directly Deposit Ether>. Otherwise, choose the buy button
- Then select the ETH coins amount you want to purchase as well as a payment method
- Enter your payment details and contact number
- Validate your purchase by submitting the six-digit code
- Your wallet will be updated in a few minutes
How to Get OpenSea NFT?
You can now buy some NFTs by following these steps.
- Select your preferred NFT at the OpenSea marketplace website online
- Click the <buy> button, accept the conditions of the NFT website, and select <checkout>
- Your MetaMask extension will show you the price of NFT along with the gas fee that is based on the network activity
How to Invest in the Binance NFT Marketplace?
Selling and purchasing NFTs and crypto-assets through Binance is quite simple. Binance is a large ecosystem that has an NFT marketplace. Therefore, users can easily purchase crypto coins or refill their wallets in the same place.
You can purchase crypto on this platform following these easy steps.
- Firstly, you need a Binance account to fill your digital wallet with the 3 cryptocurrencies allowed on the marketplace — BUSD, ETH or BNB
- Purchase coins using one of these ways — use a credit/debit card or use third-party platforms or purchase on the Binance P2P
- Deposit money in fiat currency through a bank transfer or e-wallet transfer on Binance
- Purchase your preferred NFT or cryptocurrency via a digital wallet purchase or with a debit/credit card
How to Establish the NFT Marketplace in UAE?
To understand this, you need to first understand how the NFT marketplaces function from the client-side. We have briefly discussed the workflow of most NFT markets. You know about the necessary registration and installation of a crypto wallet to keep your NFTs.
The second step is to create your crypto asset by putting up things to display your work. Plus, you can select the payment tokens you would prefer to receive for your masterpiece. And you can recommend charges if the marketplace advises.
Afterward, you will make a list of items for sale. Sellers can pick a fixed NFT price or the bidding for an auction. Then comes the cryptographic money transfer. This process makes sure the validation of each digital item by providing a digital signature to monitor the NFT ownership.
Vital Features You Can Add to your NFT Marketplace
Before you try to create the best NFT marketplace, you should understand your users and the pain points that your platform will fix. Here are a handful of features you can include in your platform.
Your NFT platform should have a wallet that enables people to store, take and send NFTs. The simplest way to integrate a wallet into a mobile application is to provide sellers and buyers with a connected digital wallet that they already have.
For example, your marketplace can have widely used wallets such as Coinbase, Formatic, MyEtherWallet, etc.
Your marketplace should enable users to tag and manage categories so that they can search collectibles. Plus, you should include categories by using a search bar on the site.
Users want ease while navigating an NFT platform. By adding filters to the search, you enable them to easily select collectibles by category, payment methods, collections, and listing status.
Add a storefront that offers buyers all the details required for a collectible — auction offers, previews, past costs, or owners.
Your platform should give an option to traders where they can make and submit items. This option should allow them to upload files and enter the token data such as tags, names, and descriptions.
Buy and Bid
All NFT platforms have to let users purchase and bid on NFTs or non-fungible tokens present in the marketplace. Your bidding feature should include an auction expiration date and enable users to see information about the auction’s present status.
So, these were some important features that are a must for any NFT marketplace. Second thing is to think about your platform’s technical applications. This includes a suitable software stack to develop your project.
We will shed some light on the popular NFT blockchain platforms used by big app development agencies in Dubai as tech stacks to establish an NFT marketplace in Dubai.
Ethereum is among the most renowned platforms that can be used for developing an NFT market. There are some qualities of this platform that are responsible for its popularity.
Firstly, you can easily provide the ownership history on this platform because transaction history and NFT metadata are publicly verifiable here.
Furthermore, all Ethereum items have the same backend, therefore tokens become movable across all the products. Ethereum has never seen any renounce so, NFTs for sale will always be available.
It is a blockchain network combined with the tools and technologies required to provide sustainability and unparalleled protection to decentralized applications and systems. Plus, it supports the creation of NFTs and other virtual assets.
Tezos is another amazing blockchain platform for mobile app development and assets supported by a community of expert researchers, developers, and validators.
It props up NFT platforms and development by employing a pre-written FA2 NFT contract developed in LIGO language for smart contracts.
Difference Between NFT and Cryptocurrency
Nonfungible tokens, as the name implies can’t be interchanged for each other. Each token is unique, distinguishing it from fungible tokens like cryptocurrencies.
NFTs are linked to distinct attributes with certificates of validation, meaning the virtual assets can’t be supplanted or exchanged for each other. Because each of them lives on a decentralized digital network that works on blockchain technology.
We haven’t yet defined a cryptocurrency so here it is: a cryptocurrency is a virtual currency that is protected by cryptography which renders it almost impossible to double-spend or counterfeit.
A lot of cryptocurrencies are decentralized blockchain networks which means a distributed ledger implemented by a disparate network of PCs. What is more, cryptocurrencies aren’t issued by a government or authority, making them hypothetically safe from any authority’s manipulation or interference.
How a Non-fungible Token is Unique in Comparison with Cryptocurrencies?
Both cryptocurrency and an NFT work through blockchain networks using similar standards and similar innovations.
Cryptocurrency has only monetary worth and is interchangeable as it is a currency. 1 ETH= 1 ETH. It means that each crypto token has the same worth as the next one within a specific cryptocurrency.
NFTs on the other hand are non-interchangeable thus, their worth is more than just their economic value.
Why do Businesses Need NFT?
NFTs enable businesses to develop digital evidence of ownership, participation, and even relocation to various experiences they provide their consumers with. In addition to that, NFTs are instant and transparent.
An enterprise that creates a token will always get a return whenever that NFT is traded. Because the smart contract of that token has code that couldn’t be changed or edited.
If a user buys an NFT and later chooses to transport it to an external investor, the company will still get a share of the money transfer as coded into the smart contract.
Your organization can still get revenue only because the experience it developed for its customers is being consumed and relished, even if the access was not bought directly via one of its revenue funnels.
With NFTs, companies are also providing their consumers an opportunity to purchase into their group/community. When users subscribe to a particular service, that connection isn’t as meaningful as the one made with NFTs.
To buy into a community means you get that community’s partial ownership. The members assist in explaining the worth of the community depending on the number of tokens they have. Along with their estimated cost when they trade off their assets after they no longer require access.
How Can Small Businesses Benefit from NFT?
Here are some of the ways NFTs can benefit your small business.
Link your Products with NFTs
Many businesses are driving more buyers by linking their physical offerings with NFTs in Dubai. More and more people are now getting acquainted with the working of NFTs.
So, the chances are getting higher that your business will get more consumers through NFTs. For example, a small shoe business can create tokens for its fashion footwear. Then, people will purchase them and earn a token after buying your shoes. A new NFT holder will be a new buyer for your brand.
Creating Trust and Reliability
Customers’ trust and authenticity are two things all businesses have to chase. Small startups can create NFTs to give evidence of the authenticity of their goods.
Sadly, a lot of organizations bear big losses because of counterfeit products. Shoppers will trust the things they buy, thanks to the digital certificate of validation they get, secured on the blockchain.
Using NFTs as Access to Digital Services
Organizations that sell online courses can keep them as NFT tokens which their course buyers can easily access. The NFT holders can unlock the course to see the content of a certain online course.
Moreover, token owners will link their digital wallets to your organization’s site to open the course. Apart from being a way to earn consumer trust and engagement, you can easily secure your content from pirates.
Handle your Supply Chain
Small companies can easily monitor their goods utilizing blockchain technology. They can see an item’s history — from making to sales and the customer’s data.
Additionally, businesses can manage their inventory easily and effectively. They will also save time and resources by handling the supply chain via NFTs.
Collect Money For Your Business
Small firms can collect money to expand their business using NFTs. Many companies are preferring this method over consulting banks for investment and funds.
A business only needs to trade the NFTs of its organization’s shares. Businesses have been trading their shares to gather funds forever. Now, they sell their nonfungible tokens to attract new investors.
Remember, customers also consider the digital logo when looking for the best NFT to buy. So make it unique and stirring to stand out to investors.
Many people have expertise in using NFTs to grow a business. Some digital marketing agency Dubai also offer this service. Because their professionals have been trading and selling NFTs for their clients for a long time.
Though, you can find a lot of information online, creating and selling NFTs is a complicated process. Newbies often get confused with this process. But we can say one thing for sure. Your small company can see a lot of growth and increase in revenue through NFTs.