You definitely know what NFTs are by now. These tradable digital receipts found on blockchains have gained popularity in the last year, with crypto enthusiasts trying to make something off them. It is estimated that the total amount of money people spent on NFTs in 2021 rose from $160 million at the start of the year to $12 billion by December.
If you are looking for a venture that can earn you some passive income, NFTs are a good pick. We will explore some of the ways you can make money from these tokens and increase your income stream. Note that these means will differ from person to person according to preferences. We hope you will be ready to begin your journey at the end of the article. Let’s take a look at the following:
1. Making and Selling of Digital art
This is one of the most common ways of making money off NFTs. Some of the most valuable Non-Fungible tokens in existence are individual NFT artworks. Artists such as Beeple have made a fortune in the recent past, selling his artwork for millions of dollars.
Consider these tokens if you are an artist or digital creator who would like to make some money off your craft. Several known establishments worldwide have jumped onto this trend, including Christie’s, known for its auctioneering prowess. On March 11, 2021, the auction house created a new record by selling Beeple’s art for an astounding 69 million dollars. This was its first auctioning of a complete digital artwork.
We can, therefore, accurately say that NFTs came to better art.
Other digital artists that are yet to hop on the NFT train can benefit from selling their art in tokenized images, including the renowned Bansky. This is definitely the best time to join the NFT bandwagon if you are a digital creator or artist.
Remember, you get the right of ownership as an artist, meaning that you will be able to prove authenticity every time you create a digital asset. Do you have a particular meme you’ve been thinking of? Well, this is the best time to release and make money as it circulates. Here is your chance to shine.
2. Sale of Licenced Collectibles
NFTs have given crypto enthusiasts a better way of dealing with collectibles. One of the reasons artists and collectors are turning to it is because it allows them to tokenize collectibles. Therefore, you can sell your physical collectibles such as trading cards and trinkets as digital assets, saving you time and effort.
Selling physical collectibles in the form of digital assets also assures you of maximum profitability, given that you will be able to prove uniqueness. If you want the value of your collectibles to increase sporadically, try these tokens. Some of the most popular collectibles at the moment are football sports cards, even though other sports have shown interest.
The National Basketball Association, popularly known as NBA, recently entered into this market through their diverse NFT cards collection, thus widening a niche originally meant for licensed football cards only. We should expect sports such as Rugby to join the trend soon, giving collectors several options.
Remember, you can turn any physical collectibles into tokenized assets and hugely benefit from trading them. Your assets will exist in digital form, stored on the Blockchain, meaning that you will not have to worry about their overtime quality. This is something worth giving a try.
3. Taking Advantage of NFT Game Development
You must have noticed the recent trend where game developers invest more in play to earn games and do away with the archaic pay-to-win framework. NFT has helped games maximize their reach and increase their revenue opportunities thanks to high-demand rewards.
These games allow players to buy, sell, trade, and exchange collectibles. Do you have any tokenized assets you would like to trade or exchange? Well, this is your chance. Gamers are known for overspending on virtual items, meaning that any video game that allows in-game selling of NFTs items is a cash cow. We expect the NFT technology to grow and continue benefitting players. The good news is that some of the notable video game developers, such as Epic Games, are known for promoting NFTs and the metaverse.
The main disadvantage of this avenue is that in-game NFTs are incredibly advanced compared to other collectibles. They must be upgraded as they keep changing time and again. Also, they must reflect the changes in a player’s character, which requires constant upgrades.
4. Sale of Fashion Pieces
NFTs have penetrated different sectors, including the renowned fashion industry, which is believed to run the world. Non-Fungible tokens have a way of proving the authenticity and eliminating counterfeits, which are highly needed in the fashion world.
You must have seen clothing and fashion brands taking advantage of these tokens by creating and releasing limited digital versions and editions of outfits. Others also include collections of celebrity pieces and design signatures. Therefore, you can hugely benefit from NFT if you are a fashionist, designer, or own a clothing brand. How about digitizing the limited editions of your outfits, releasing them on NFT platforms, and letting people bid?
Well, the good news is that NFT still has many possibilities. You can try as many avenues or get as creative as you want. You can link up with clothing and fashion brands to cash on NFT development by creating an independent NFT marketplace for different clothes and accessories. You will maximize profits by trading NFTs in a secure and robust framework with proper marketing and outreach. Buyers won’t also have second thoughts, given that the authenticity of the pieces can be proven thanks to blockchain technology.
5. Banking on NFT Royalties
Do you know that you are allowed to set terms that guarantee you royalty fees whenever your NFT is sold in the secondary market? Well, it is a concept oi you didn’t know. You don’t have to earn only ones from the first sale of your NFT; you can make money as many times as you need, provided that it changes hands.
Well, how does this work? Let us assume that you have set your royalty for a piece of art at 10%, and it sells for 20 million dollars. You will be entitled to 10% of the selling price as the digital creator regardless of how many terms it changes hands. This is made possible by Blockchain technology which powers non-fungible tokens, meaning that you receive passive income even after relieving your creations to collectors.
Jack Dorsey, the Twitter CEO and boss sold his NFT tweet for 2.9 million dollars, meaning that if he had chosen the royalty option and set it at 10%, he would be entitled to $290,000 every time someone buys it from the previous buyer. This is definitely one of the best ways of making money off NFTs, as you can be easily set for life if you own several well-selling NFTs just from the royalties only. It would be best if you considered investing or creating these tokens.
6. Staking NFTs
You can also make money from your non-fungible tokens by staking them. Also known as farming, this refers to locking away or depositing your tokens to earn a yield, made possible by the link between these tokens and decentralized finance, popularly known as DeFi. You will keep away your digital assets into a DeFi Protocol and create profits thanks to smart contracts.
Most people seem to have mastered this money-making avenue and are doing quite well. However, note that you have to choose your platform well. One of the most popular platforms for staking NFTs is WhenStaking, owned and operated by Onessus Blockchain systems, a game and NFT publisher operating in the United States. You can check it out later.
Some platforms will give you several NFTs to the stake, while for others, you must purchase their native NFTs if you intend to earn staking rewards. Other platforms that will allow you to stake NFTs are Only1, Splinterlands, NFTX, and Kira Networks. Note that all have their shortcomings and benefits, and therefore, you need to be more careful and, if possible, research extensively before picking one.
It is also worth mentioning that part of your rewards may be converted to governance tokens in some cases, depending on your platform. Games such as Decentraland allow players and users to hold voting rights over future developments, replicating the real world. You can see just how connected the metaverse is to NFTs.
One can also choose to reinvest some of the tokens earned from staking into different yield generating protocols. However, make sure that you know how the mechanism works before committing to it.
7. Offering Liquidity in Exchange of NFTs
DeFi infrastructures have massively revolutionized NFTs. You can quickly earn from NFTs by providing liquidity, made possible by the continuing integration between these infrastructures and these tokens. You can easily better position yourself in a specific liquidity pool.
One platform that allows crypto enthusiasts to offer liquidity is Uniswap V3. By providing liquidity on the platform, you will be issued an ERC-721 token, popularly known as LP-NFT, by the automated market maker, which shows your share of the total amount tucked away in the pool. This has a similar working mechanism as staking NFTs, just that it is more complex.
The LP-NFT will also have details of the token pair deposited, their symbols, and the address of the particular pool. If you are wondering how to make money from this arrangement, sell the LP-NFT to liquidate your position in the pool quickly and profit from it.
Another unique platform is NFTX, a marketplace and liquidity protocol that allows crypto enthusiasts to buy and sell NFTs. It has a vault that allows you to deposit whole NFTs and mint fungible tokens representing the value of the NFT. This platform allows you to use these fungible tokens, popularly known as the vTokens, to buy any random asset within the vault that you can later trade for a profit. It is definitely worth your time and consideration.
8. NFT-Powered Yield Farming
This relatively new concept is possible because NFTs are becoming essential parts of automated market makers. You can, therefore, easily farm for yields through NFT powered products. What then is yield farming? Yield farming is a creative concept that allows you to earn additional revenue. You get to leverage several DeFi Protocols with the digital assets you own so that you can get the highest possible yield.
We will use the example in number 7. Uniswap issues you with LP-NFT tokens when you offer liquid. This token can be used as collateral or staked on other protocols, guaranteeing you additional profit. This is, therefore, a continuation of the seventh means of making money of NFTs since you will be getting a yield on top of a different yield generating protocol. This is the best means of generating income if you are a yield farmer.
Just make sure that you conduct extensive research and understand this concept and what it holds before you decide on it. It is also worth noting that smart contract technology hasn’t been with us for quite some time and maybe pretty challenging. Therefore, yield farming and providing liquidity may carry some risks which you should be aware of to maximize your earnings.
9. Renting Out NFTs
You can easily make money by renting out your Non-fungible tokens. Several platforms have come up in the recent past to allow enthusiasts to obtain NFTs for a short duration.
Some of the reasons people rent NFTs include short-term flex, art installations, exhibitions, and digital art dealing purposes. Axie Infinity also allows NFT game item owners who may be busy and therefore lack time to play to rent out their items to other players.
It is pretty clear from this explanation that the NFT market holds several possibilities that investors can choose to actualize and benefit from. You can also lend your NFT to a non-holder willing to attend Ann NFT-holder only event but doesn’t want to pay for fill ownership.
You might want to consider lending people some of your rentable NFT pieces you aren’t using and make some money off them.
10. Try Influencing
One of the reasons why NFTs have become popular overnights is because people finally see their endless possibilities. Do you know that you can easily make money by being an NFT influencer, creating a name in a nitch that most people have never thought about?
Well, being an NFT influencer means increasing people’s awareness of these tokens through valuable content.
You must be wondering how this will guarantee you some money. Well, you can create a brand if done right and build a considerable following, giving you a chance to monetize different products and services.
However, this will not work if you fancy overnight success. with the right amount of patience, this venture can pay off, given that most people haven’t heard of NFTs and would be happy to learn about them.
Lastly, remember that you are not limited to only one means. You can simultaneously try as many as possible.
How to Sell NFTs
Now that we have seen the different avenues to make money with NFTs, you should know how to sell them. For starters, note that these digital tokens are always sold on marketplaces, differing in selling processes. The most common means is uploading your content to the marketplace, creating an NFT, and selling it. Therefore, if you have something in mind, consider the following steps:
1. Select the Marketplace
You must have a platform that will enable you to sell your NFT. Some of the available choices include Axie Marketplace, OpenSea, SuperRare, Rarible, and Mintable. Ensure that you lookout for the features, pros, and cons.
2. Mint the NFT
The next step is to mint the NFT, defined as turning your digital file into a digital asset on the Blockchain. Your preferred marketplace should have a detailed step-by-step guide to help you.
3. Link Your Wallet
You can’t sell a token without first opening a crypto wallet. You can choose from several options such as Binance and Coinbase and then link to the marketplace.
4. List Your NFT for Sale
This is where you sell your Non-fungible token. You will have to either choose whether you’d like to sell the item as a one-off purchase or earn royalties for every sale. After filling out the necessary information, you will list your file for sale. If you are using an Ethereum blockchain, your platform will calculate the gas fees used to record the transaction. You can easily reduce the fees by listing your product at the right time since it shoots whenever the network is busy.
NFTs are here to stay, making this the best time to start cashing from them. Make sure that you choose the right platform and conduct extensive research before starting your venture. We wish you all the best!