What Is Minting An NFT?

Minting / NFT / Learn

Minting an NFT is a term used within the NFT space that describes the process of creating NFTs as an artist/creator. Learn more on how that's done.

What Is Minting An NFT?

Minting an NFT is a term used within the NFT space that describes the process of creating NFTs as an artist/creator, or purchasing a newly minted NFT as a collector/investor. Minting an NFT involves converting the digital data of the non-fungible tokens into digital assets that are recorded on the blockchain.

All NFTs are stored via blockchain technology which keeps a record of the asset itself and all the transactions that have been made regarding ownership. This database is a decentralized digital database, meaning it's part of a digital ledger forever that cannot be edited, modified, or deleted.

Minting an NFT records the item to the blockchain and means that you’re the first owner of it. If the term sounds familiar to you, it’s because it is! Minting an NFT isn’t all that dissimilar of a concept from minting a real coin. 

In this guide, we’re exploring the question, “what is minting an NFT?” for those interested in investing in NFTs. We’ll also take a look at the advantages and disadvantages of minting NFTs that are worth considering.

Minting Vs. Buying an NFT

To answer questions like, “what does minting an NFT mean?” you need to understand the difference between minting vs buying an NFT. In order to buy an NFT, the asset first has to be minted, or created. What is minting an NFT? It’s literally the process of converting digital data into crypto collections or digital assets recorded on the blockchain. 

Is it better to be on the minting side of acquiring NFTs or do you benefit more from buying on a secondary market instead? Buying NFTs on a secondary market is much simpler as it just involves purchasing the token via a cryptocurrency wallet. Before beginning your NFT experience, consider the pros and cons of each.

Minting Pros & Cons

Minting an NFT as a collector or investor means getting in on the ground floor and being the first owner. This comes with its own set of pros and cons. While there are certain risks to being the first owner of an NFT, doing your research into what makes an NFT rare or valuable will maximize your odds of minting an NFT that grows in value over time. Let’s check out some of the pros and cons of minting an NFT as an investor or collector to help you determine which is right for you.

Pros of Minting NFTs

Owning an NFT, whether you’ve minted it from a project or buy it from an NFT marketplace, gives investors and collectors the opportunity to be part of a rapidly-expanding industry. The digital age is upon us and digital investments provide a new wave of possibilities for investors to make a profit. Some of the 

Diversify Your Portfolio

Minting an NFT as an investor or collector helps diversify your portfolio in a way that meets your long-term and short-term goals. A diverse portfolio gives investors a blend of safer, stable investments that may show relatively little growth as well as those that offer the potential for higher growth though come with slightly higher risk.

Portfolio diversity also means investors hold assets in a variety of categories. For more traditional investments like owning stock, this may mean holding shares across different industries like finance, tech, and healthcare. Today’s investors, however, are recognizing the immense opportunities provided by non-traditional investments, as well, making NFTs a prime new territory for exploring.

Cheaper Entry Price Compared to Secondary Sales

Another pro in terms of minting an NFT as an investor is getting in at a potentially cheaper entry price compared to secondary sales on the NFT marketplace. Early investors have the chance to get in at the lowest price. This gives them the highest potential of seeing an increased return on their NFT investment. 

Minting an NFT May Give You a Rare Asset

Minting NFTs from a new project at their release may result in your owning a rare or valuable NFT off the bat. While the associated risk is that the NFT floor price could immediately fall, you may have also gotten hold of a digital asset that is immediately considered rare, giving you a return on your investment from the beginning. 

Quick Sell Options for Popular or Trending NFTs

For investors looking for a relatively quick turnaround for profit, minting NFTs from a new collection offers the chance to make money fast. For popular or trending NFT collections being released, the NFT drop can yield profit potential immediately. If you've done your research on an upcoming NFT project and have determined it to be a good option to invest at that stage, then it may be worth taking the risk for quick sell profit potential.

Cons of Minting NFTs

Answering the question, “what is minting an NFT?” means exploring the good and the bad. While you’ve seen some of the pros of minting NFTs as an investor, there are potential downsides to consider, as well.

No Guarantees to Make Money

The most obvious con to minting NFTs as an investor or collector is that there’s no guarantee you’ll make money. Purchasing NFTs at release has inherent risks that the collection could perform less successfully than you anticipated. There are thousands of NFTs that are minted regularly to the NFT marketplaces, but not all of them are going to be successful.

Floor Price Could Drop

Another con of minting NFTs as an investor is that the floor price of a new collection could drop lower than the mint price. This would result in a loss right away. A collection that doesn’t sell out and sees a slowdown in minting volume could impact the stability of the project in short and long runs.

Possible Scams When Minting NFTs During Presale

Like with any kind of investments, you should always be wary of potential scams. Being on the allowlist for presales of a new NFT collection is the holy grail for many investors, but be sure it’s legit before you opt to invest. Scams pretending to be presale NFT launches are common on Discord. Remember that project administrators will never privately message you with a mint link, so if you’re approached this way it’s most likely a scam..

Gas Fee Spikes and Gas Wars

When a new NFT project is hyped up, there can be spikes in gas fees during initial public sale. These “gas wars” skyrocket minting fees that could drastically eat into your potential profit as an investor. This is why finding yourself allowlisted for presale is the best option, if you’re able to position yourself to do so. 

Buying Pros & Cons

Buying an NFT is something that's a lot more common than minting and thus a preferred option for many. If you're looking to follow suit and potentially profit as many investors have in NFT marketplaces, then buying them is the better option. Just like with minting NFTs, however, there are pros and cons to buying them, as well.

Pros of Buying NFTs

There are loads of NFT marketplaces to choose from. Many require transactions to be done using cryptocurrency, but a few emerging marketplaces like UCOLLEX allow you to purchase them with just a credit card; no crypto needed! UCOLLEX is a popular platform for buying NFTs and gives you valuable insight into trending projects and collections to look out for.

Buying from an NFT collection can be a great way to provide growth for your investment. While the minting process could make you money, it's often only the initial purchase that provides any growth and requires more of your time and effort along the way.

When you purchase an NFT, there's a chance that your initial investment could end up fetching a considerable amount more. Those who've purchased NFTs for a few thousand have since made millions in some cases.

Another benefit of purchasing an NFT is ownership itself. Owning an NFT is a pretty cool thing to say you have as an investment. Whether you plan to diversify your investment portfolio or not, owning an NFT in a digital wallet is not something everyone has. With NFTs being irreplaceable and one-of-a-kind, it's something that's truly special to own.

There’s also something to be said for getting in on the ground floor of the NFT craze. As a rapidly-growing industry still in its infancy, those that invest in any kind of NFT, from digital artwork to 10-second sporting clips, are a part of something new. If NFTs continue garnering great success further down the line, you can brag and boast that you were a part of its success by being invested in it early on.

Lastly, for those wishing to invest in these digital assets, buying NFTs can help towards creating a personal presence in the market itself. Many who own NFTs have a digital certificate which makes them official within the NFT community. The digital ledger that these NFTs are stored on cannot be changed or deleted, meaning your information and position is there forever.

Cons of Buying NFTs

Just like with minting NFTs, there are cons to buying NFTs, as well. Understanding the disadvantages of NFTs can help to make an informed decision on whether it's the right investment for you or not.

Firstly, you simply can’t digitize everything. Digital artwork is a great investment opportunity for collectors of physical art. However, the experience of viewing physical art is something you can't digitalize. It’s irreplicable.

Beyond the viewing experience, there is the uncertainty of the future value of any given NFT, as well. NFTs are on a decentralized market, meaning anyone can make up the cost of an NFT. NFTs are often confusing assets, even to those who consider themselves specialists in this investment market. 

The value of NFTs is therefore uncertain, and while you could end up paying an NFT for thousands of dollars, you may find that it's fairly valueless when you come to sell it on. To combat this, do your research about what makes an NFT valuable to maximize your potential profitability. 

How Does Minting Work?

Now that you’ve got a better understanding of the question, “what is minting an NFT?” you may be wondering how it works for investors and collectors. The process of minting an NFT from a new collection means taking specific actions and precautions to be ready at launch, protect your investments, and secure yourself against potential scams. These steps you’ll want to follow are:

  • Create your digital wallet
  • Find an NFT project in the launch phase
  • Find the mint price and date
  • Bookmark the official site from Discord
  • Make sure you have enough crypto in your digital wallet
  • Connect your wallet at the mint date and time

Create a Digital Wallet

Before you start minting NFTs from new projects, you'll need to create a digital wallet. This is where you'll store your crypto. You’ll use crypto to pay for transaction fees that come with minting new NFTs and adding them to your portfolio.

For a new project that’s just launching, you may consider setting up a new digital wallet used online for minting new projects in case there are any security issues that arise. This protects the rest of your assets from being compromised in that case. There are lots of digital wallets available to choose from, so be sure to do your research to find the best option for you.

Find an NFT Project in the Launch Phase

Part of minting NFTs as an investor for a potential profit is finding the right NFT projects in the launch phase and positioning yourself to get in on the ground floor at the lowest price. This means researching the project and team of creators behdin it to determine the project’s viability for a profit.

Check out the project’s community, join the Discord server, and follow any news about it on Twitter to learn as much as possible before it launches. You should also look into an NFT project’s utility to see if it’s likely to be a valuable collection to invest in at launch. 

Find the Mint Price and Date

As you’re learning how to mint an NFT as an investor, it’s crucial to find out the initial mint price and launch date of new projects you may be interested in. Beyond the mint price and date, check to see if there’s a cap on how many you can mint per wallet in order to prepare a plan if you’re looking to purchase more than one NFT at launch.

The holy grail of NFT investors is being allowlisted for early sale. Not only is this often the way to get the best price possible and avoid gas wars, it also lets you avoid the stress of fighting the masses at public sale when a new NFT collection launches.

Bookmark the Official Site From Discord

For investors and collectors looking to get in on the ground floor for new NFT projects that stand to yield a profit, security should be a priority. As Discord is the highest-ranked invite-only app for community building, many NFT projects have accounts for nurturing community participation and followings prior to launch. The higher the engagement on Discord, the more legit and secure you can expect the NFT project is likely to be.

Additionally, these servers are often the best ways to position yourself for information on NFT drops, being allowlisted, Dev updates, and other potential perks. 

Almost all projects contain an “official links” section in their Discord so you can bookmark the official site/mint site, social profiles, and other important pages to lessen your chance of getting targeted with a scam.

Have Enough Crypto in Your Wallet

A simple, yet overlooked, aspect of preparing for minting an NFT from a new project is having enough crypto in your wallet. This goes beyond the initial mint price of new NFTs in a project. Remember that the total cost of minting an NFT at launch will also include gas fees for minting on the Ethereum blockchain.

Connect Your Wallet at the Mint Date and Time

To finish up minting an NFT at launch, make sure you’ve connected your digital wallet at the mint time and date in order to complete the transaction. For projects with major launch buzz, the demand could bog down bandwidth, raise gas fees and lead to the possibility some transactions may not process properly. To avoid this, be prepared and ready to go at the right time!

Can You Buy An NFT With a Credit Or Debit Card?

While most of the blockchains where NFTs are available to buy only accept cryptocurrencies from a crypto wallet, there are a select few that allow you to make a purchase with a credit card. UCOLLEX is one of those platforms that allows you to buy nfts with a credit card and has made it more accessible for those wishing to purchase NFTs with no crypto needed!

Purchasing cryptocurrency is not something that all investors are willing to get into. While experienced digital investors are familiar with the growth and immense potential surrounding cryptocurrencies and digital asset investment, the unfamiliar territory is daunting to some. Having the option to bypass it altogether and simply purchase NFTs through more traditional currency payment methods is handy.

We hope this guide gave you a better understanding of the question, “what is minting an NFT?” while showing you the ups and down to minting vs buying. While creating NFTs can be a fun endeavor for creative types looking to get into the newest investment venture, buying NFTs is the preferred method for most NFT investors and hobbyists. Consider your options and determine which makes the most sense for you as you start your NFT experience.

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