NFT’s and Cryptocurrency is a huge topic so this article is going to only scratch the surface. It is also not intended to be financial advice in any way, this is just my best understanding of it and how I am using it personally and for Atelier Ashley Flowers.
By now you know that NFT stands for non-fungible token and by definition it is “a non-interchangeable unit of data stored on a blockchain, a form of digital ledger, that can be sold and traded. Types of NFT data units may be associated with digital files such as photos, videos, and audio.” (Wikipedia)
What is hard to understand is why they hold value. The confusion comes because “why can’t you just screenshot?” The answer is that it is not just about the possessing the image but the real world utility that goes along with the full NFT. The benefits of the full NFT can only be unlocked by holding the digital information that is contained within the NFT and stored and displayed on the blockchain.
A blockchain is “a decentralized, distributed and public ledger that is used to record transactions across many computers so that a record cannot be altered retroactively without alteration of all subsequent blocks and consensus of the network.” (synopsis.com)
There are many different blockchains, the most popular you have probably already heard of Bitcoin and Ethereum any maybe Flow or Polygon if you are a little more advanced. There are also many others. Each blockchain has their own token, or cryptocurrency associated with it. For Bitcoin it is Bitcoin, for Ethereum it is Ethe/Ether, for Polygon it is Poly, and Flow it is Flow. Typically you use a cryptocurrency to pay for an NFT though there are some ways to directly purchacse using a credit card.
Before you are able to buy crypto, you are going to need to set up your “digital wallet”. There are many popular wallets, Coinbase and MetaMask are probably the most user friendly and popular. I currently use Coinbase and Blocto wallets to store my NFTs. These are considered “hot wallets” because they are online. The most secure digital wallet to get is something called a “Ledger” which actually moves your crypto and NFTs offline and can only be accessed if you physically possess the device.
When you set up your wallet, you will need your drivers license, then to take a real time selfie, tyour bank account/creditcard, and patience. A “seed phrase” will be generated. This is your 12 -20 word pass phrase and is the only way to access your account. Do not store this online anywhere. Write it down and keep it in a safe place. If you loose it, there is no technical support, you are out of luck and locked out of your accounts forever. Pretty stressful if you ask me!
From here I am going to be talking specifically about Coinbase because it is the one I am most familiar with and use the most. When you are in your Coinbase wallet you will see you now have a specific digital address. If you go into the “advanced settings” you will see you actually have 10 unique wallet addresses. This is because it is not uncommon for wallets to become compromised. I recommend having one public and named account that you do all your buying from, and then once bought immediately transfer your NFT or Crypto to a different wallet that you leave unnamed.
If you are only buying from verified accounts or people who are “doxed” (their real identity is known/public) you should be fine. The problem is, that there really are so many scammers and “bad actors” and being duped is not a question of if, but when. It is fairly likely that you will make mistakes early on and buy “fakes” or click on bad links. It is a good practice to buy from a “burner wallet” ( a wallet that only has enough money for whatever transaction you want to make) and then transfer your piece to a safer place.
Never ever ever, give out your seed phrase or enter it online!
One thing that should be mentioned at this point are the “gas fees.” “Gas fees are payments made by users to compensate for the computing energy required to process and validate transactions on the blockchain.” (investopedia). This is something you will begin to really only understand as you go through the process, but be warned gas fees fluctuate during the time of the day and can be extremely expensive. It is always a toss up, do you want to pay the gas fee and be assured of your “mint” or do you want to take a chance that it will be gone if you wait for another time.
“Minting, in regards to NFTs, is the process of taking a digital asset and converting the digital file into a digital asset stored on the blockchain.” (Canstar.com) Essential it moves it from one place on the blockchain to another place on the blockchain that makes it yours.
As I mentioned earlier, you pay for your NFTs in crypto, sometimes the crypto can be bought directly from your wallet and other times you buy it from an online cryptocurrency exchange like Crypto.com.
Clearly this is not an uncomplicated process, but once you get the hang of it, you will feel very accomplished and in many ways like a new world has opened up. Currently my husband is very into the cryptocurrency, which is very much like gambling/the stock market in my opinion. You make educated guesses on different coins and invest in them. If the coin goes up in value, you make money. If it goes down in value, you loose money. While not fully regulated yet, if you do get into NFTs and crypto, keep track of everything, you will need to declare this on your taxes.
I am most interested in NFTs because I believe in their potential and can see their really world application for Atelier Ashley Flowers.
I am currently invested in two projects, “The Flower Girls” and “Some Place Social.” I own several NFTs of each. The current mission of The Flower Girls is to donate a portion of revenue back to charity but also provide unique online and real world benefits for the owners of the Flower Girls. It is a bit complicated to go into all the nuances, but essentially they are creating an online “seed store” where you will be able to buy/trade your nfts for real life experiences and art. With Some Place Social, they are currently building an aesthetically pleasing Metaverse where using their NFT “Potions” as a key, I will be able to access the space and hang my own gallery. It is still in the developmental phase, but I think the idea is that you will also be able to visit the other Potion holders spaces and walk around in the Metaverse. Celebrities such as Resse Witherspoon and Eva Longoria are a part of the project and how I first learned about it.
All of this brings me to how I see Atelier Ashley Flowers using NFTs in the future. While I have many ideas, such as a Metaverse Flower shop where you can buy digital flower arrangements for your virtual home, what I see as being the introductory use is some kind of discount, or access to some kind of private class. So theoretically, anyone who holds a particular NFT could get free local delivery, a free arrnagement, or special access to a live event.
On the order form of the website we now have the option to pay in crypto, and to have an original 1/1 not generated at the time of purchase. While that NFT will not initially hold any real world “utility” it may in the future.
I hope this has helped shed a little light on NFTs and crypto and why I have been so interested in pursuing this new technology. If you have any corrections or information I should add, please fee free to email me at atelierashleyflowers@gmail.com.