Notifications Bell

Lesson 14: NFT Coins 

Lesson 14: NFT Coins 

Lesson 3: How to accept Bitcoin

NFT coins are the cryptocurrencies that move digital assets on a blockchain. Non-fungible tokens, or NFTs, became popular one of the most popular digital assets in 2021. As more platforms such as metaverses and marketplaces are using blockchain and NFTs, there’s a growing demand of these NFT tokens, and cryptocurrency investors might take advantage of it.

In this lesson, you will find the information you need to know about NFT coins, the top NFT coins and how to invest in NFT cryptocurrencies.

What are NFT coins?

NFTs (non-fungible tokens) are unique cryptographic digital assets that are stored on the blockchain. Although they are not tangible, these virtual assets are proof of the ownership of the digital artwork they represent.

In fact, an NFT can be almost anything that can be represented in a digital form, such as art, music, real-estate certificates, and in-game assets. But similar to how we use physical items in the real world, we treat NFTs that exist on the blockchain.

NFT coins are the native coins or tokens of a specific NFT ecosystem and are needed for using that NFT on the protocol. Since most NFTs are created on the Ethereum network, most NFT coins, or tokens, are ERC-20 tokens. But that’s not always the case. Other networks are now creating NFTs, and these assets can also be found on Solana, Tezos, Flow, WAX, and BSC.

These NFTs can behold forever, but they can also be traded, just like you would trade cryptocurrencies any other asset. To make use of an NFT, the NFT owner must be active in that NFT’s ecosystem, which often is represented by a metaverse, digital game, or marketplace. Like any other blockchain app, all transactions or actions on these ecosystems require you to pay a transaction fee, which is also known as a gas fee. These transaction fees are paid in that NFT’s native coin or token, which we shall call NFT coins.

Are NFT coins a good investment?

An investment in NFT coins depends greatly on the popularity and scarcity of that NFT project.

These digital tokens, or NFTs, are a form of virtual certificate, like a title or physical certificate that you might present in order to prove ownership of a physical asset like real estate. But NFTs can also guarantee ownership of unique assets, from property to collectibles and works of art.

However, not all NFT projects will be created equal. NFTs can be sold by projects that do not own the creative rights or ownership rights to the digital asset. Research is key to any investment. NFT coins investors should be aware of the NFT marketplaces that offer licenses for those NFTs, and the overall success of the NFT’s platform.

What are the most popular NFT coins?

Since the NFT industry explored in 2021, investors could have a hard time finding and differentiating between the many NFT coins available today. That’s why we created this list of the most popular NFT coins to guide you as an investor.

Ethereum (ETH)

  • Market cap: $231,097,814,769
  • Circulating supply: 121.98 million ETH
  • All-time high: $4,891.70 (November 16th, 2021)

Launched in 2015, Ethereum is the default blockchain for most NFT projects, thus transforming ETH into one of the top NFT coins. Ethereum was the first blockchain that integrated smart contracts, which are used by all NFTs as well as decentralized apps. The majority of in-game NFT items can be built on Ethereum, and they are usually valued in Ether (ETH), the native currency of Ethereum.

Ethereum has the largest NFT community and hosts two of the most popular NFT metaverse platforms (Decentraland and The Sandbox). Ethereum allows anyone to use the network to deploy permanent and immutable applications onto it. Users can also create and exchange NFTs, by using the Ether (ETH) NFT coins. Many other cryptocurrencies also use the ERC-20 token standard that is built on top of Ethereum, including many other popular NFT coins.

Ethereum is the second-largest cryptocurrency by market capitalization. Decentralized exchanges allow for ETH pairings with even the most valuable NFT crypto coins.

Solana (SOL)

  • Market cap: $15,241,945,310
  • Circulating supply: 348.8 million SOL
  • All-time high: $260.06 (November 6th, 2021)

Solana is already one of the most widely used blockchains for NFT projects, which makes SOL one of the top NFT coins. As it also plays a huge part in decentralized finance (DeFi), SOL is currently ranking in the top 10 cryptocurrencies, and there's no doubt that Solana NFTs are gaining in popularity.

Solana meets the needs of users who want faster and more affordable transactions. Many of the top platforms have already integrated with Solana. Users are moving to Solana at an ever-increasing rate as integrations become available.

SOL NFT coins are powering a number of NFT projects, such as Degen Ape Academy, DeGods, and Solana Monkey Business (SMB).

While Ethereum remains the most widely used blockchain for new NFT projects, user preferences are starting to change and Solana is growing as an NFT platform. The most popular NFT platforms such as OpenSea have already integrated Solana, and the blockchain has a growing number of marketplaces.

Dogecoin (DOGE)

  • Market capitalization: $9,494,104,344
  • Circulating supply: 132.67 billion DOGE
  • All-Time High: $0.7376 (May 8th, 2021)

Dogecoin was created in 2013, and it is the most popular meme coin it is now on its way to becoming an NFT coin. It was intended to be a joke about the rapid growth of Bitcoin and altcoins. However, today Dogecoin is one of the top cryptos, and many businesses are accepting DOGE as payment. With the launch of the smart contract platform Dogechain, users are now able to transfer their DOGE. The wrapped DOGE will soon be used on various decentralized apps, including the platform’s native NFT marketplace called RareBreed.

Dogecoin is now a top cryptocurrency and one of the future NFT coins, considering its steady development. In 2021, billionaire entrepreneur Elon Musk, CEO of Tesla and SpaceX, promoted Dogecoin on social media, and it drove the price of the meme NFT coin up to $0.73.

Although Dogecoin has fallen from its 2021 peak, the digital token remains one of the most popular crypto coins worldwide.

Polygon (MATIC)

  • Market cap: $7,699,916,445
  • Circulating supply: 8.04 billion MATIC
  • All-time high: $2.92 (December 27th, 2021)

Due to its similarities with Ethereum, Polygon is a great NFT platform with unlimited offers for crypto enthusiasts. Polygon is a Layer 2 protocol that aims to make NFTs more affordable by minimizing gas fees, which are very high on the Ethereum blockchain. Polygon's Layer 2 features allow for incredible scaling of its NFT projects, which makes MATIC one of the top NFT coins.

Sidechain technology from Polygon makes transaction times faster and gas costs almost non-existent. Polygon is compatible with all ETH-based apps and it’s available on most NDT marketplaces, such as OpenSea and Rarible. Investors can use MATIC for their NFT investments.

Polygon (MATIC) ranks in the top 15 cryptocurrencies, by market cap. Launched in 2019, MATIC's price reached an all-time high of $2.40 in May 2021. This was three months after MATIC had undergone a major rebranding, from Matic Network and Polygon Network.

Flow (FLOW)

  • Market cap: $2,836,623,678
  • Circulating supply: 1.04 billion FLOW
  • All-time high: $46.16 (April 5th, 2021)

FLOW is another NFT coin and it is Flow's native cryptocurrency. This NFT coin is used as a payment method, and to incentivize validators. In a nutshell, FLOW is the currency that fuels the network and sustains the ecosystem of applications that are built on top of it.

Flow is a developer-friendly network of blockchains, and it is designed to support many apps and blockchain games. Its multi-node architecture is multi-role and scales without sharding. It specializes in specific node functions, increasing speed, and throughput. Flow protects users' data and offers digital assets that can trade on the open market.

The Flow blockchain offers some unique features for developers, such as its programming language (Cadence). Developers have access to a variety of tools and support, while consumers have easy-to-use payment options. Flow employs a proof-of-stake (PoS), consensus mechanism that splits validation among multiple types of nodes. Validating transactions requires that each type of node be involved. Flow is distinguished by its multi-role architecture, which allows it to scale without sharding.

Flow was designed to support NFT collectibles and crypto games. You can buy NFTs via the app marketplace or trade digital assets via NBA Top Shot. Developers have easy access to a variety of tools that allow them to create DApps and simply experiment.

Decentraland (MANA)

  • Market cap: $1,946,782,690
  • Circulating supply: 1.85 billion MANA
  • All-Time High: $5.90 (November 25th, 2021)

Decentraland is one of the most popular crypto NFT projects. It is built on the Ethereum blockchain. The Decentraland metaverse supports NFTs, which can be all sorts of in-game digital assets, such as real estate or avatar accessories. The NFTs are traded for NFT coins called MANA.

With the rise of the NFT marketplace in 2021, MANA was also one of the NFT coins to rise in value. NFT owners began using the platform to showcase their NFTs. But Decentraland isn’t just a virtual place for NFTs. Its main feature is the ability to buy virtual land or create digital assets. Many real-world companies have started to purchase pieces of land in Decentraland to build a virtual office within the metaverse. Some of the most famous brands that exist in the Decentraland metaverse are Sotheby's, a broker of luxury goods, Samsung, Nike, Coca-Cola, Adidas, and Atari.

Decentraland’s native coin, MANA, is a well-established NFT cryptocurrency, that is easily accessible and highly appealing to novice users. Decentraland's metaverse offers exciting interactive opportunities, including concerts and festivals that rival those in the real world. Decentraland is expanding and has an active development team that provides many options and opportunities.

Decentraland was created in 2017, but it became mainstream in 2021 when NFTs started to trade massively. MANA has fallen significantly since the start of the year but is up slightly when compared to last year. Although MANA's performance has been under pressure during the 2022 bear market, Decentraland (MANA) is still one of the most popular NFT coins in 2022.

ApeCoin (APE)

  • Market cap: $1,933,685,567
  • Circulating supply: 306.8 million APE
  • All-time high: $39.40 (March 17th, 2022)

ApeCoin is an ERC-20 cryptocurrency that was launched in 2022 by Yuga Labs. It is native to both the Bored Ape Yacht Club (BAYC), and the Otherside metaverse game. Yuga Labs raised approximately $320 million through a virtual land sale. Investors can use APE tokens to purchase parcels called Otherdeed. Otherdeed is the key to claiming land on Otherside, and that’s why APE is one of the most popular NFT coins.

Otherside will be a metaverse game with a fully-fledged MMORPG virtual world. It will be integrated into the BAYC ecosystem. This will likely include ApeCoin. ApeCoin NFT coins can be used as both a governance and utility token. Holders may participate in the governance of DAO or gain access to exclusive mints, games events, merchandise, and services.

Holders bought 55,000 lots or "Otherdeeds", and 45,000 went out to others, including Yuga Labs NFT owners and founders. Because of the high volume of transactions, the sale caused huge gas fees on the Ethereum network. This issue with the Otherdeeds' minting process led to a significant drop in ApeCoin prices and a decrease in demand for the coin. APE's value dropped from $26 when the sale was announced to $3.49 by June. Yuga Labs' demo in the Otherside metaverse, to which it invited 4,300 Otherdeed owners, caused a price spike that could be a turning point.

APE is also being removed from the circulating supply to increase the price. If the project survives, buying APE now at a bargain price could be a good long-term investment. However, if the project fails, ApeCoin would be worthless.

The Sandbox (SAND)

  • Market cap: $1,824,200,404
  • Circulating supply: 1.28 billion SAND
  • All-time high: $8.44 (November 25th, 2021)

The Sandbox is another top-performing crypto project. SAND is the NFT coin that is required in this metaverse. The Sandbox is basically a game, and it’s achieving the vision of the metaverse by incorporating a VR component. Atari, a gaming company, is backing it, which could be helpful in the current bear market.

Sandbox is a direct competitor for Decentraland and released its first game in 2012, but it’s not focusing on building a 3D metaverse, which allows users to build, trade and earn in-game digital assets. It also allows users to buy and trade parcels of land. All these digital assets present in Sandbox are NFTs and can be traded using NFT coins, which are called SAND.

SAND, the native NFT token of the platform, was consistently on the rise in 2021, finally crossing the $1 mark during the last quarter of 2021, continuing its upward trend to $8.40 in November 2021. However, it has fallen like most other cryptos during 2022.

Enjin Coin (ENJ)

  • Market cap: $615,730,232
  • Circulating supply: 896.39 million ENJ
  • All-time high: $4.85 (November 25th, 2021)

Enjin was founded in 2017 and offers a globalized database that allows users to store and manage digital gaming products in a secure and safe manner.

Enjin software allows developers to create and manage virtual goods using the Ethereum blockchain. The platform also makes it easy to sell and buy NFTs using a mobile app that supports QR codes.

Enjin is a blockchain-based technology that allows for the management of in-game objects across multiple properties. This will help to reduce fraud and high fees that have plagued the transfer and collection of virtual goods and collectibles. Enjin’s SDK (software development kit) allows users to create digital assets on Ethereum and then integrate them into apps and games. Each asset can be customized to fit any platform. The items are also recorded in smart contracts, which gives them the benefits of cryptocurrency, including speed, cost, and security.

Enjin coin, or ENJ, is the NFT coin of the project. Enjin's cryptocurrency is used to assign a value to each item in-game created on Enjin. This is the central component of managing digital assets on its platform.

Enjin offers users a unique marketplace experience. It can help them expand their markets with NFTs or QR codes and connect with others through websites, apps, and games. It is powered by Ethereum and offers a decentralized experience.

WAX (WAXP)

  • Market cap: $265,119,590
  • Circulating supply: 2.13 billion WAXP
  • All-time high: $5.01 (December 21st, 2017)

The Worldwide Asset Exchange (WAX) is undoubtedly the most well-known NFT blockchain, which makes it native coin WAXP, one of the top NFT coins. WAX is widely recognized as a popular network for digital collectibles, and virtual items, and it is highly efficient for many NFT enthusiasts. The blockchain's reputation has been established despite being under the radar.

WAX was Founded in 2017 by crypto pioneers William Quigley & Jonathan Yantis. WAX is the most secure and convenient way to buy, sell, and trade virtual (and physical) items, and has a mission to offer global accessibility towards digital assets and help build the Web3 ecosystem.

WAX gives its users access to thousands upon thousands of decentralized apps (DApps), and a variety of unique NFT marketplaces. WAX hosts many top blockchain games such as Alien Worlds and Farmer's World. Because gaming is such an important force on WAX the largest projects, out of all PFP or collectible endeavors, still hail from the Play-to-earn gaming sector.

While digital collectibles reign supreme on WAX, blockchain is a leader in another sector, Web3 gaming. NFTs have been popularized by WAX, along with other chains. It seems that WAX has been able to grow its ecosystem by focusing on Web2 gaming enthusiasts. Also, many influential brands such as baseball collectibles company Topps, racing giant NASCAR, toy company Hot Wheels, and many others have found a home on WAX.

Where to trade NFT coins?

Before trading NFT coins, the first thing to do is research and choose the best crypto app for you. You will find many services online to help you buy, sell, and trade cryptocurrency, including crypto exchanges and online brokers.

  • Online brokers: There are a few online brokers that offer ways to buy and sell NFT coins, in addition to other assets like stocks, forex, and ETFs. These trading platforms tend to offer lower trading costs but fewer crypto features.
  • Cryptocurrency exchanges: You'll have many cryptocurrency exchanges to choose from, each with varying offerings of cryptocurrencies, wallet storage, interest-bearing account options, and more. Many exchanges charge asset-based fees.

As you're comparing different platforms, it's wise to consider things like supported cryptocurrencies, security features, fees, storage and withdrawal options, and educational resources.

Using a brokerage may be a suitable option for higher trades due to several reasons, such as security and significant liquidity. After depositing your collateral, you have various trading possibilities, including leverage positions and a variety of assets. All these instruments are available on the same trading platform, but each specific broker might offer different trading instruments.

Another way to trade NFT coins is to use a cryptocurrency exchange. These are platforms that use an order book mechanism for each trading pair. This is the way a buyer meets a seller, and the crypto exchange charges a fee.

When compared to cryptocurrency exchanges, traders might find brokers to be more useful for trading. That’s because online brokers offer cryptocurrencies in addition to their selection of stocks, ETFs, options, bonds, and mutual funds. Crypto investors can use a diversity of investment vehicles that provide exposure to the crypto market and blockchain technology.

Another big advantage of using online brokers is that investors can trade and speculate on the value of the assets as it moves in both directions. This means that there is a possibility to make a profit even if the NFT coin prices go down if you had opened a sell position. However, if the price moves up, you lose your investment. This is not the case with cryptocurrency exchanges, which do not offer the option to speculate on the price movement, and traders must wait for the price to move in only one direction.

Unlike buying NFT coins in the hope they increase in value, CFDs (contracts for difference) enable crypto traders to speculate on cryptocurrency prices, either “going long” if they think the price will increase or “going short” if they think the price will decrease.

CFD trading is leveraged, which means you can gain exposure to a large position without having to commit the full cost at the outset.

While leverage enables you to spread your capital further, it is important to keep in mind that your profit or loss will still be calculated on the full size of your position.

When you open an account with CAPEX, you will be able to:

  • Open buy and sell positions. With cryptocurrency CFDs, you can speculate on any price movement (up or down).
  • Trade multiple individual cryptocurrency CFDs at the same time.
  • Diversify your portfolio by trading CFDs on other assets (crypto, stocks, bonds, currencies, ETFs and commodities).
  • You can start off with a demo account funded with $50,000 virtual cash to allow you to practice risk-free trading before you use any real money.

How to trade NFT coins?

If you want to buy and hold NFT coins, then you can use a cryptocurrency exchange. However, if you want to speculate on the NFT coins’ price movements, you can use an online broker that offers crypto CFDs.

Here is how to buy meme tokens through an exchange or trade CFDs on coins with an online broker:

  • Choose which type of platform you want to use. Your first concern should be to find a reputable online broker that has a wide range of cryptos and other assets, including stocks and ETFs. If you want to withdraw your cryptos to a private wallet and keep it for longer, you should consider using a crypto exchange.
  • Create an account. Regardless of your chosen platform, you need to register and complete the KYC process to verify your identity.
  • Fund your account with fiat money. Before buying and trading any crypto, you need to fund your exchange account with U.S. dollars, Euros, or any supported fiat currency on that platform.
  • Select your cryptocurrencies. It’s time to decide on your first cryptocurrency investment. We strongly recommend that you thoroughly research the project behind the coins you want to add to your portfolio. You can invest in one or more cryptos.
  • Place a buy order for your chosen cryptocurrency. Follow the steps required by the trading platform to submit and complete a buy order for one or more cryptocurrencies.

After your purchase is complete, the information needed to access your cryptocurrency is held in a digital wallet. That crypto wallet can be hosted either by the cryptocurrency exchange or an independent wallet provider.

When trading crypto, the CFDs (contracts for difference) are stored in your account and are far more liquid. However, you should be aware that CFD trading is fast-moving and requires close monitoring. As a result, traders should be aware of the significant risks when trading CFDs. There are liquidity risks and margins you need to maintain; if you cannot cover reductions in values, your provider may close your position, and you'll have to meet the loss no matter what subsequently happens to the underlying asset.

With CAPEX, you can trade CFDs on 22 cryptocurrencies and other cryptocurrency assets like stocks, ETFs, and Blockchain Future TematiX.

Should you invest in NFT coins?

The truth is that NFT coins are increasingly growing and that popular NFT projects are only getting stronger. As more people start using cryptocurrencies, NFT games, and metaverses, these coins are starting to be in great demand.

However, the world of cryptocurrencies remains largely unregulated and projects are not yet overseen by any financial authority, which represents a risk for those who choose to invest in these NFT coins.

Investing in NFT cryptocurrencies can present an elevated risk. NFTs represent digital ownership of assets -- pictures, music, tickets, and more. Having digital property within a metaverse platform could prove valuable someday, but it is extremely difficult to predict. Investors should conduct thorough research before investing real money in any of these assets.

It may be in the best interests of investors to focus more on real-world companies building and generating revenue from the NFT trend. Learn more about investing in stocks.

Free trading tools and resources

Remember, you should have some trading experience and knowledge before you decide to trade cryptocurrencies. You should consider using the educational resources we offer likeCAPEX Academyor ademo trading account. CAPEX Academy has lots of courses for you to choose from, and they all tackle a different financial concept or process – like the basics of analyses – to help you to become a better trader.

Our demo account is a great place for you to learn more about leveraged trading, and you’ll be able to get an intimate understanding of how cryptocurrency trading works – as well as what it’s like to trade with leverage – before risking real capital. For this reason, a demo account with us is a great tool for investors who are looking to make a transition to leveraged trading.

Esta información preparada por sc.capex.com no es una oferta o solicitud con el propósito de comprar o vender ningún producto financiero referido en el presente o participar en una relación legal, ni un consejo o recomendación con respecto a tales productos financieros.

Esta información está preparada para su circulación general. No se refiere a ningún objetivo de inversión específico, situación financiera o necesidad particular de un receptor.

Debería evaluar independientemente cada producto financiero y considerar la idoneidad de dicho producto, teniendo en cuenta sus objetivos de inversión específicos, la situación financiera o las necesidades particulares, y consultar con un asesor financiero independiente si fuera necesario, antes de operar con los productos financieros mencionados en este documento.

Esta información no debe ser publicada, estar en circulación, reproducida o distribuida en su totalidad o en parte a ninguna persona sin el consentimiento previo por escrito de la Compañía.

El rendimiento pasado no es siempre indicativo de las probabilidades o del rendimiento futuro. Todos los puntos de vista y opiniones presentados son exclusivamente del autor y no representan necesariamente las de sc.capex.com
Compartir este artículo