Coinbase wants to bring NFTs to the masses with its soon-to-be-launched NFT Marketplace. NFTs -- or non-fungible tokens -- are digital certificates of authenticity and ownership that can be built into collectibles, art, music, in-game items, and much more. They became extremely popular last year, so much so that Collins Dictionary declared NFTs its word of the year.
The cryptocurrency exchange already allows users to store NFTs in its external Coinbase wallet. But its new NFT marketplace product will make it easier than ever for users to mint, showcase, buy, and sell NFTs. Coinbase's idea is that it should be as easy to buy an NFT as it is to buy a sweatshirt or any other product online.
Here are four things you need to know about the new product:
1. You won't need crypto to buy NFTs with Coinbase
Like many aspects of the crypto industry, buying an NFT is not as intuitive as it could be. For a start, you'll need to have an external crypto wallet containing the right digital currency. That's often Ethereum (ETH) but other networks like Solana (SOL) are also proving popular for NFTs.
Coinbase wants to make things easier. It has partnered with Mastercard to allow anyone with a Mastercard credit or debit card to buy an NFT. They'll still need a crypto wallet to store their purchase, but the partnership certainly removes one of the biggest pain points.
2. Over 3 million people have already signed up
Since Coinbase initially announced its NFT Marketplace product in October, over 3 million people have joined the waitlist. I was number 3,297,132, at the time of writing. Being on the waitlist means you can get early access to the new marketplace, as well as receiving other notifications -- for example, finding out when Coinbase will actually launch its new product.
3. You can get higher up the waitlist by referring more people
The higher up the waitlist you are, the sooner you'll be able to use Coinbase's new NFT marketplace. That's decided by how early you signed up and how many people you refer. Once you submit your email and join the waitlist, you'll get a referral link. So, if you're not happy with being toward the end of the line, you can encourage others to sign up and boost yourself up the list.
4. It's only open to U.S. residents -- at least to start
Coinbase customers that live outside the U.S. will have to wait a while longer before they can use the new product. The company will roll out its NFT marketplace first to U.S. users but plans to launch it internationally as well in time.
There are a number of different NFT marketplaces, some are focused on one particular product such as CryptoPunks or Axie Infinity items. Others sell a whole spectrum of NFTs, and accept payments in their own tokens or in a range of cryptocurrencies. Check out our list of top NFT marketplaces to get an idea of which one might be best for you.
If you're considering buying an NFT, bear in mind these are highly speculative assets that can be difficult to value. It is a bit like buying art in the real world -- the artist's reputation, prevailing trends, and various other factors all help to determine its price.
Right now, many warn of an NFT bubble and there are concerns people are buying products they don't fully understand in the hope the price will increase. There's also criticism about the environmental cost of NFTs. And some artists claim their work has been made into NFTs without their permission.
NFTs do have a lot of potential in the digital world. The technology can fundamentally change the way we own things online, whether it is music, metaverse items, or art. But the actual value of an individual NFT is a very different proposition. It's a good idea to buy an NFT because you like it and want to own the product rather than because you hope the price will go up.
Before you buy an NFT, make sure you understand the risks involved. You'll also need to have somewhere to store it. And, as with cryptocurrency, don't spend money you need for other financial goals. That way you won't be devastated if your NFT loses value.
Emma Newbery owns Ethereum and Solana. The Motley Fool owns shares of and recommends Bitcoin.
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