How to Buy NFT in South Africa in 5 Easy Steps
What are NFTs and why are some of them worth millions of dollars?
To most people, these digital collectibles are simple jpeg images selling online for tens of thousands of dollars. But in fact, it is an emerging crypto and digital asset sector, expected to grow by $147.24 billion from 2021 to 2022.
The ongoing NFT trend caught fire early last year when the digital artist Mike Winkleman (aka Beeple) sold his artwork “Everydays: The First 5000 Days” for $69 million in an auction at Christie’s. Ever since then, it has been a crazy ride. The trading volume for the global NFT market increased by more than 21,000%. We saw several projects come to the forefront, like the Bored Ape Yacht Club, whose all-time trading volume surpassed the $1 billion mark.
As a result of this unprecedented growth, almost everyone wants to jump onto the digital asset bandwagon and benefit from some lucrative deals. However, when it comes to getting started and choosing a secure trading platform to purchase NFTs, most people are clueless.
If you are looking for a solution to these problems, you are at the right place. This article will guide you through the entire process of how to buy NFT in South Africa and the best ways to make money with NFTs. Stay tuned!
What is an NFT?
Before we get started, it’s crucial that you thoroughly understand what this technology is and how it works.
NFTs is an acronym and stands for non-fungible tokens. Non-fungible means that every NFT is one-of-its-kind, hence, entirely unique and cannot be replicated or replaced. It is the complete opposite of fungible digital assets, such as Bitcoin, where every token is technically identical. This is why, no matter which BTC token you own, it will be worth exactly the same as the rest.
One may argue that you can also create copies of an NFT by saving the image or video on your device. However, thanks to the immutable nature of blockchain technology, the actual ownership of the token can neither be faked nor destroyed. Think of it like any other real-world artwork. For instance, you can buy copies or prints of Leonardo da Vinci’s Mona Lisa, but it does not mean that you own the original since there is only one such painting.
Benefits of the NFT Technology
The NFT technology has revolutionized the world of art and entertainment in several ways. Following are some of the best ways creators and investors can benefit from this innovation.
Security has always been one of the foremost concerns of the art industry. That’s why if you ever visit an art gallery or a museum, you’d see tight security all over the place. Although physical art pieces can be secured using different types of tools, such as CCTV cameras and alarms, the risk is even more significant in the digital world, where online breaches and cyber attacks are real threats.
The problem can be solved easily by converting your digital artwork into non-fungible tokens on a blockchain. Being decentralised and arranged in chronological order, stealing or altering the blockchain data is almost impossible for any hacker.
The online art industry has been suffering because of intellectual property thefts and copyright issues ever since its inception. Fake ownership documentation is not only a problem for digital assets but real-life properties and valuables as well. Investors are bound to go through lengthy and tiresome procedures to authenticate the validity of these documents. Fortunately, the ownership of all NFT assets is easily verifiable within seconds on a blockchain.
Transparency is another key factor that helps investors determine the authenticity and safety of digital assets or NFTs. Most NFT blockchains, like Ethereum, are completely open-sourced. As a result, anyone with the right tools can monitor and verify the transactions taking place on the blockchain. This helps users to trace the ownership timeline and history of any particular NFT from wallet to wallet. Typically, NFTs with a more detailed history are more valuable.
Not every digital creator gets to enjoy a substantial social media following. Finding the right audience for your digital artwork is not an easy job either. This results in most artists not getting the right price and exposure their artwork deserves. The NFT industry has revolutionised this landscape for digital artists and creators, giving them global exposure and multiple ways to promote and sell their artwork.
How to Buy NFTs
Now that we have covered what NFTs are, let’s find out how to buy NFTs using a crypto wallet. Any South African citizen can easily purchase and trade NFTs by following these steps.
1. Set Up a Wallet
First of all, you will need to set up a crypto wallet. These wallets are used to send, receive, and manage crypto funds. You can think of these wallets as the blockchain world equivalent of bank accounts in traditional finance. There are two basic types of crypto wallets:
Custodial wallets are centralized cryptocurrency exchanges that allow you to buy, sell, and trade several crypto tokens. Using these wallets is as easy as setting up a Google email address. All you need to do is set up a username and password, verify your identity, and link the wallet with your bank account or credit/debit card. However, such a cryptocurrency wallet is not suitable to buy NFT tokens.
Non-Custodial Crypto Wallets
Unlike a centralized cryptocurrency exchange where you do not even own security keys (private keys) for your crypto funds, non-custodial crypto wallets give you complete control over your digital assets and holdings. You can use these wallets to trade and store fungible crypto coins and non-fungible token assets.
Users have many options when it comes to choosing a cryptocurrency wallet. Most of these are free to download and available as mobile applications, desktop software, and browser extensions. The most popular crypto wallet to buy NFT tokens or trade NFT is an Ethereum wallet called MetaMask.
To set up your MetaMask wallet:
- Visit the official MetaMask website and click the ‘Install MetaMask for Chrome’ button. After the installation is completed, add the MetaMask extension to your browser.
- The last and the most important step is revealing the Secret Backup Phrase. It is a randomly-generated 12-word unique phrase that will be required in case you forget your password or are accessing your wallet through a new device. If lost, you will never be able to access your crypto assets and NFT holdings. It is recommended to physically write it down somewhere and never share it with anyone.
2. Fund Your Crypto Wallet
To buy and transfer NFT tokens, you will need some crypto tokens to pay for gas fees of the blockchain and transaction charges of the marketplace. The type of crypto tokens needed depends on the blockchain of the marketplace and the NFT project you choose.
You can pay these fees using only the native coin of the respective blockchain. The majority of the marketplaces will require you to use ETH tokens, as most NFT projects are built on the Ethereum blockchain at this point of time.
You can buy crypto tokens directly through the wallet or transfer them from another wallet. Some wallets, like MetaMask, allow you to buy crypto coins using your credit/debit card, making the entire procedure relatively simple and quick. For example, in an NFT auction.
However, many wallet-offering services do not provide this option. In such cases, you can purchase the coins from a cryptocurrency exchange, such as Binance, and then send those funds to your wallet using the blockchain address.
3. Select and Set Up NFT Marketplace Account
After setting up your wallet and adding ETH tokens, the next step is to set up an NFT marketplace account. But first, you need to decide which NFT marketplace you are going to use.
NFT marketplaces are trading platforms where you can mint, buy, sell, and trade your NFTs. They work almost the same way as Amazon or eBay: the seller lists the products (in our case, NFTs), and the buyer places the order for the asset they want to purchase.
When choosing an NFT marketplace, you must always consider a number of factors. For example, the platform should not be expensive, charging you a series of different fees. Similarly, it should be well-known and reliable.
Unfortunately, there have been several incidents in the past when the entire NFT marketplaces got hacked, and investors lost all their funds and assets. Moreover, you need to make sure that the marketplace you choose covers the type of NFTs you are interested in. Some marketplaces (like Foundation) are more focused on artwork NFTs, some (like NBA Top Shot) are sports-centric, while others (like Axie Infinity Marketplace) are built around NFT-based video games.
After having chosen an NFT marketplace, it is time to create an account. To create an account on OpenSea – the world’s largest NFT trading platform – simply visit the homepage, click on the profile icon on the top right, and connect your MetaMask wallet.
4. Connect Your Wallet
Connecting your cryptocurrency wallet with an NFT marketplace will allow you to interact with the blockchain network. Decentralized NFT trading platforms do not own your digital assets. Instead, they simply serve as a bridge between buyers and sellers, enabling P2P transactions.
Make sure you have the MetaMask browser extension installed on your device and that you’re logged into your wallet. To connect the wallet, you will have to conform to the procedure from the NFT trading website and the wallet interface.
Next, you can change your username, add a bio, and change your security settings by clicking on the three-dot icon on the right side of the screen.
5. Buying NFTs
The final step is exploring the marketplace and buying NFTs. You can either scroll through the main interface, check out different NFT collections listed on the site, or search for a specific project. Usually, all popular collections are verified with a blue tick mark. Make sure to look for it to avoid rip-offs and fake projects.
Once you have found an NFT token you like, click on it, and the site will take you to the next page. Here, you can view the current price as well as the price action history. Click on the “Buy Now” button. Review total (the price and the gas fee) and checkout. You will be required to confirm the transaction from your MetaMask wallet.
Top NFT Marketplaces
As mentioned before, choosing a reliable and easy-to-use NFT marketplace with a good number of listed projects is vital to ensure a decent NFT shopping experience. Following are some of the most popular NFT marketplaces in South Africa.
OpenSea was the first-ever NFT marketplace, launched in 2017 to enable trading for the first popular NFT project, i.e., CryptoKitties, a leading digital art project. Since then, the platform has experienced massive growth and widespread adoption, making it the world’s largest NFT marketplace by trading volume.
According to Dune Analytics, OpenSea hosts more than 1.5 million active monthly users. Moreover, it is home to over 80 million NFT tokens. The marketplace recently hit a $5 billion monthly trading volume, making it the highest-ever record. For those looking for how to buy NFT in South Africa, Coinbase is a good start.
The platform is completely decentralized and built on the Ethereum network. However, it also supports several other blockchains, such as Polygon and Klaytn. Most of the NFT projects are based on ERC-721 and ERC-1155 Ethereum token standards. You can also find a good range of Polygon-based NFT tokens that are faster and cheaper to trade.
Apart from MetaMask, OpenSea supports 13 other crypto wallets. You can use more than 200 different cryptocurrencies as payment methods. As far as the variety of NFT tokens goes, you can find a massive range of NFT projects, including NFT collectibles, digital artwork, domain names, in-game items, sports-related NFT, and much more.
The marketplace charges buyers a 2.5% commission fee on every transaction. The creators don’t have to pay any fee apart from the network charges, including minting fees and gas fees.
However, the platform recently launched the lazy minting feature, allowing creators to list their NFTs without actually minting them on the blockchain. The process is complete when a purchase order for the NFT is placed. On top of that, you don’t have to pay any withdrawal or inactivity fees. This makes things easier in the digital asset world.
- Competitive commission fees
- Cutting-edge security measures
- A massive variety of NFTs
- Supports 14 wallets
- Accepts more than 200 cryptocurrencies
Binance NFT Marketplace
Binance is the largest cryptocurrency trading platform by trading volume in the digital asset world. The platform also entered the NFT industry, launching its own NFT marketplace in June 2021. Thanks to the company’s popularity and incredible success trading in digital assets, Binance has a large userbase, making it one of the most popular NFT marketplaces worldwide.
Binance is powered by Binance Smart Chain, and most of the NFTs are built on the BEP-721 token standard. However, it also supports NFT tokens based on the Ethereum network. You can find several types of NFTs here, such as sports, e-sports, art, trading cards, documents, entertainment, collectibles, metaverse, etc. The unique “Mystery Box” feature is the main attraction for many investors. Users can purchase a box that may include a random, extremely valuable NFT.
The interface is very clean and super easy to use for beginners. At the same time, it also features a variety of technical indicators for more experienced investors. You can purchase NFTs using BNB, BUSD, and ETH. It also allows users to mint new NFTs on Binance Smart Chain and Ethereum.
The minting fee is paid using BNB tokens and varies according to the day and time. The platform does not charge any listing fees, which is something not many NFT trading platforms are offering at the moment. Moreover, Binance charges an extremely cheap commission fee of 1% for each transaction made.
Though NFTs can only be bought using crypto tokens, you can deposit fiat currencies using several accepted deposit methods, such as debit/credit card, wire transfer, and PayPal. The deposited fiat funds can then be used to buy crypto tokens from Binance’s crypto trading platform quickly. You should also note that the website allows P2P transfers.
- Very low fee structure
- Allows fiat deposits
- No inactivity fees
- Features NFTs on Binance Smart Chain and Ethereum
- Very low minting fees
Launched in 2020, Rarible is one of the industry-leading NFT trading platforms that allows users to create, buy, and sell NFTs. This Ethereum-based platform is decentralized and completely community-centered. The platform has its own native crypto token RARI which is the first of its kind in the NFT and digital art industry.
Users can participate in governance by holding RARI tokens and have their say in several decisions regarding the platform. Rarible aims to develop into a Decentralized Autonomous Organization (DAO) and become a part of the thriving DeFi world.
The site features a variety of NFT categories, including collectibles, in-game items, digital artwork, as well as some less popular formats, such as photography and music. Another feature that makes this marketplace a unique option is that it also allows users in South Africa (and elsewhere) to showcase their NFTs listed on OpenSea.
Although the marketplace is built on Ethereum, its multi-chain support enables users to buy and sell NFT tokens built on other blockchain networks, such as Flow and Tezos. You can buy NFT tokens using RARI, USDC, DAI, ETH, and a few more cryptocurrencies.
As far as the fee structure goes, Rarible charges a 2.5% commission from both the buyer and seller on each purchase of NFT art. Creators have to pay the network’s minting fees. However, the marketplace also supports the lazy minting feature, allowing creators to pay the minting fees only when their NFT is purchased.
You can also set royalties up to 50%, which means you will earn a certain percentage of each sale of your NFT made on secondary marketplaces. On top of that, users can also earn rewards in RARI for buying and selling NFT art.
You can deposit fiat funds into your account using wire transfer and credit/debit cards. The platform also supports a range of digital wallets, including MetaMask, Coinbase, MyEtherWallet, Torus, Portis, and Fortmatic.
- Has its own native token, RARI
- Supports lazy minting
- A range of digital wallets can be connected
- Multi-chain support
- Creators can set royalties up to 50%
Our next pick for a popular NFT marketplace is NFT LaunchPad. Launched quite recently in February 2022, NFT LaunchPad is already one of the trending NFT platforms worldwide.
As a result of its remarkable marketing strategy and commitment to facilitating creators through various means, the website has become home to more than 10,000 NFT projects in less than six months of its release. You can access the platform through your laptop and cellphone. The interface is smartly designed and works perfectly well for both mediums.
NFT LaunchPad features NFTs built on the Binance Smart Chain and Polygon Network. Both these blockchain ecosystems are extremely fast and cheap for minting NFTs. You can find several NFT categories, including collectibles, animations, digital art, metaverse items, in-game items, and videos. The platform allows users to design their own creator page, enabling people interested in your NFTs to follow you. This page may include the creator’s journey and their social media accounts.
Minting NFTs is relatively much easier on NFT LaunchPad. The platform guides you through the entire process using simple steps. Moreover, it lets you set royalties and rarity levels, allowing you to earn through sales of a digital asset at secondary marketplaces.
All NFTs are bought using Wrapped BNB (WBNB), a BEP-20 token available at several cryptocurrency trading platforms. You can purchase them at fixed prices, auctions, and declining auctions. So far, NFT LaunchPad supports Trust Wallet and MetaMask. The options may seem limited, but we expect the list to grow as the platform grows.
Both supported blockchain networks are famous for extremely low mining costs and gas fees. Moreover, this marketplace charges absolutely no fees for listing, buying, or selling NFTs, making it one of the most accessible options for beginners to trade NFTs.
- No fees for trading and creating NFTs
- Easy and quick minting process
- Supports less popular formats, like MP4
- Focused on NFT creators
- Allows you to design your own creator page
Tips for Investing in NFTs
Following are some tips for buying NFTs that may help you make better investment decisions.
Rarity is probably the most important factor that drives the price for any NFT token in the digital world. NFTs with higher levels of rarity are often much more valuable. Marketplaces like OpenSea allow you to check the rarity level for each individual NFT before purchasing.
Most of the NFT art space is filled with NFT projects with no real utility. That’s why experts believe many of these collections will lose their value over time. However, you can invest in NFTs that provide some utility as they are more likely to retain their price over time. These include metaverse-based NFTs, membership NFTs, blockchain-based games NFTs, etc.
You can research purchasing NFTs and figure out which NFT projects are attracting a large audience. For this purpose, you can take to popular social media platforms, such as Twitter and Discord, where most of the crypto and NFT community members interact with each other.
The NFT space is growing at a rapid pace. Every day, we see dozens of new NFT projects being launched. Even celebrities like Snoop Dog, Lindsay Lohan, Shawn Mendes, and Lionel Messi have stepped into this space, creating more hype around this technology. Many multinational corporations, such as Nike, have launched their own NFT collections. These initiatives are a testament to the incredible success and the bright future of this innovative technology.
However, the industry is still at its initial stage. The investments are based on pure speculation, and prices constantly fluctuate. That’s why NFTs are considered a high-risk investment sector. Financial advisors recommend investing only what you are comfortable losing on any cryptocurrency exchange.
Our extensive analysis of the South African Crypto Space doesn’t stop here. You can also check out our Guide on how to buy UMI Coin.
Most frequent questions and answers
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