Friday, April 12, 2024

Things To Know Before Selling an NFT Artwork

Selling an NFT artworkWhat are the most important things to know before selling an NFT artwork? There is some very obvious advice (the artwork must be yours to sell, obviously) and there is some advice you won’t get from bloggers who have never actually attempted to discover the world of selling an NFT artwork.

Things To Know Before Selling an NFT Artwork

The first thing to remember is that you are dealing with cryptocurrency, which is unregulated and trends toward the wild west in terms of zero oversight or regulation of the day-to-day dealings of crypto (reputable and otherwise). And while that does NOT mean there are no regulations that apply to crypto transactions, usually, these (for the purposes of buying and selling) have more to do with how crypto assets are taxed and accepted in America.

That means there is danger for the inexperienced. You can be scammed, your cryptocurrency can lose its value, the fad may end, etc. Those are the things you’ll be warned about in blogs where there’s no experience in the art world or in dealing with crypto. And these warnings should definitely be heeded, but they are NOT the entire picture.

What You Need To Know About Selling an NFT Artwork

Let’s skip all the obvious advice like, “you need to set up a digital wallet/cryptocurrency wallet or nft wallet to buy and sell NFT artwork.” That advice falls squarely into the “no duh” department. Let’s skip ahead to the stuff you really want to know.

Not All Cryptocurrency Accepted

Selling NFT art means dealing in the preferred crypto coin of the realm, so to speak. You may find that serious buyers want to use Ethereum or prefer Bitcoin. You may discover that your NFT artwork options are wide open in terms of what crypto you accept, but the buyers may have specific demands in this area.

Transaction Fees

This is the big one. In the digital art world outside of selling an NFT artwork, art is bought and sold between private citizens. Art is sold between collectors and galleries. Furthermore, they are also sold artist-to-artist, artist-to-collector, artist-to-gallery, etc. Galleries charge fees to sell an artist’s work. Their commissions can be hefty.

Selling an NFT artwork is a way to circumvent a gallery fee. However, that does not mean you won’t be nickeled and dimed to death by something called gas fees. Those fees are the cost of doing business with NFTs. Much NFT art is bought and sold using Ethereum as the currency, and in the specific case of Ethereum, gas fees are a major issue.

How Gas Fees Work

How do gas fees work? “Gas’ is required to mine Ethereum cryptocurrency and to carry out transactions. This costs money. The fees are used to regulate traffic on the network. But they are also used to prevent spamming, and regulate the ebb and flow of the transactions. Gas fees get lower if the buyer and seller are willing to wait to process the transaction. You save money if you don’t want instant gratification.

Gas fees go higher when there is elevated traffic on the network, and for that instant gratification of instant buying and selling (as instant as it gets with crypto and NFTs) is priced at a premium.

You may be subject to gas fees just for uploading your NFT artwork, and you could even be charged simply for accepting a bid in an online auction of your NFT.

Does this sound complicated? It is. And as a result? Research far beyond the scope of this article should be done before you decide to invest in minting and selling NFT artwork for cryptocurrency.

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