Digital tokenized art is very much on the rise.
According to NonFungible.com's end of year report, the sector is expected to grow by as much as 50% in 2020 and projected to reach a market capitalization of a cool $315 million.
As investors flow into the digital art world, there are opportunities aplenty for those looking to make money trading digital art.
What are NFT's?
NFTs also known as non-fungible tokens are a special type of token created on the Ethereum blockchain and designed to represent unique digital assets such as art.
So what makes NFT's so valuable?
The value of traditional art is derived from a number of factors with the most prominent being ownership history, authenticity and rarity.
Establishing the true ownership of an artwork can be a daunting task, however that is not the case with NFT's.
NFT's combine digital art with blockchain managed ownership.
Each NFT's history is stored permanently on the blockchain ledger making ownership of an art piece transparent and conclusive.
Art forgeries are estimated to cost the art industry over $6 billion annually.
As forgery techniques advance it is becoming increasingly difficult to distinguish between authentic art pieces and high quality forgeries.
NFT's eliminate forgeries by acting as a certificate of authenticity. All data relating to an art piece is secured on the blockchain and cannot be destroyed or manipulated.
Rarity refers to the overall supply of an artist's creations.
Artists who respect scarcity and don't flood the market are more likely to maintain a higher average price and their works generally appreciate well over time.
SuperRare's NFT Marketplace allows users to track the history of each artist so you know the exact number of artworks in circulation at any one time.
What is SuperRare Marketplace?
The platform works by allowing artists to create and sell unique tokenized works of art in the form of NFT tokens.
NFT tokens are exchanged on SuperRare's peer to peer marketplace with each token representing ownership of a single edition authentic artwork.
How to make money trading digital art?
Next create an account on SuperRare and link your MetaMask wallet.
Once you've topped your Ethereum wallet up you are ready to get started.
How to find the best deals
The SuperRare market and activity pages are a great place to start.
On the market page you can check out what artworks are trending, how much they are selling for, current bids and previous transaction history. All of which can help you to establish a clear valuation.
The activity page is also crammed with useful information such as the latest transactions, trending collectors and trending artists.
Choosing the right artist
The art world is highly speculative and when it comes to choosing a work of art, more often than not, choosing the right artist is the most important factor, so I would recommended checking out the trending artists tab to see if any appeal to you.
Once you find an artist that interests you, it's a good idea to look up their social media accounts to see how actively they are engaged with the community and get a general feel for the artists vision and art.
Look at artist stats
When you have developed a good understanding of the market, it's time to check out the artist stats page which is crammed with useful information about each artist, such as, total number of works created, average sales price and number of works sold.
Check price history
It is always advisable to check the price history of the artists previous works and of the art piece itself to help you establish a fair price and gauge demand.
Making a purchase
When it comes to making a purchase, you can either choose to place a bid in Ethereum which the owner of the art may or may not choose to accept, or you can purchase it instantly by meeting the "buy it now" price.
The transaction is then carried out effortlessly through your MetaMask browser extension which also used to store and transfer your NFT.
How to sell a piece
Should you wish to sell your piece, you can easily set a sales price on it at any time and it will instantly show up on SuperRare's peer to peer digital market place for all to see.
Once a bid has been made or a "buy it now" price has been matched, you will receive an instant email notification.
Tokenized art looks set to revolutionize the art scene with more and more art being digitilized everyday. Artists are beginning to recognize the distinct advantages blockchain technology and NFT's in particular offer the art industry.
NFT's are very much still in their early stages and with the ecosystem expected to accelerate over the coming months and years, there has never been a better time to make money trading digital art on SuperRare Marketplace.
Author: Ronan Mullaney