NFTs: A Guide for Photographers
What is an NFT or 'non-fungible token'? What is an NFT marketplace? And what does the sudden popularity of this new technology mean for photography and photographers? Read on to find out.
The Collins Dictionary crowned NFT its word of the year for 2021. But the truth is, NFTs aren’t all that new. In fact, the first one appeared way back in 2014.
Still, they have definitely hit the mainstream in the past year or so, thanks mainly to some high-profile sales in which NFTs have sold for staggering amounts of money.
For example, in February 2021, musician Grimes earned more than $6 million for NFTs representing various pieces of digital art.
The following month, digital artist Mike Winkelmann (AKA Beeple) sold the NFT for a digital artwork titled ‘Everydays: the First 5000 Days’ at Christie’s for $69.3 million.
Beeple's 'Everydays: The First 5000 Days' [Christie's]
Soon after that, Twitter founder Jack Dorsey sold an NFT representing his first ever tweet for more than $2.5 million.
You get the idea. You probably also noticed that these NFTs ‘represent’ or are connected to these digital entities, but are not the entities themselves.
Confused? You’re not alone. Let’s take a look at NFTs, how today's digital marketplace works, and what you need to know if you're a photographer looking to get into the NFT space and create an NFT for one (or more) of your images.
What are NFTs?
NFTs are ‘non-fungible tokens’. Each token is a unit of data verified and stored on a digital ledger called a blockchain. It is ‘non-fungible’ because it is unique, with its value linked directly to the value of the digital asset attached to it.
By contrast, a $10 bill is ‘fungible’ because the holder could exchange it for a different $10 bill, two $5 bills, or ten $1 bills, without making any financial loss or gain.
Gold is also fungible because a specified amount of gold (a bar, say) can be exchanged with an equivalent amount with no change in value occurring.
Arguably, calling these tokens ‘non-fungible’ makes things unnecessarily complicated. Why? Because non-fungibility is actually quite normal.
A house is non-fungible, for example, because its value is the subject of negotiation between buyer and seller. One house can’t simply be randomly swapped for another (unless, of course, both owners agree to it!).
To add to the confusion, there are no 'fungible tokens' that can be differentiated from non-fungible ones. When it comes to tokens of this kind (i.e. verified by the blockchain), non-fungible ones are the only kind available.
Image courtesy of Joshua Sortino
Basically, NFTs offer a way of establishing and proving ownership of a digital asset – for example, a digital image, a piece of digital art, or a digital video file.
But just to make things even more taxing for photographers, buying an NFT doesn’t necessarily give you the copyright, intellectual property rights, or exclusive use of the digital asset it represents.
In other words, though the buyer of Jack’s first tweet is as close to ‘owning’ it as anyone can get, we can still find and view that tweet whenever we want, without paying a penny:
just setting up my twttr— jack⚡️ (@jack) March 21, 2006
Why do people buy NFTs?
If you’re wondering why anyone would part ways with their hard-earned millions for a digital file that anyone can simply right-click and save to their downloads, you’re not the only one.
So why do people buy NFTs?
One answer is to support artists and photographers. This makes sense when we’re talking about buying an NFT associated with a photograph or a work of art. But what about NFTs for tweets, GIFs, or virtual super yachts in The Sandbox metaverse?
This is harder to explain, mainly because motivations will vary from one buyer to the next. The simplest interpretation is to think of NFTs as investments.
On this basis, a person invests in an NFT because they believe (or at least hope) that the token will increase in value. Are they correct? As with any investment – whether it’s in stocks, bonds, real estate, traditional art or something else – nothing is certain.
For now, NFTs are hot. Whether their stratospheric rise will continue indefinitely remains to be seen.
Of course, if you’re a photographer selling NFTs for your images, you are probably more interested in finding buyers than pondering their motivations!
So without further ado...
How do you sell and buy NFTs?
Given that NFTs rely on blockchain technology – the same kind of decentralised digital ledger on which cryptocurrency transactions are recorded – it should come as no surprise that NFTs are bought and sold using cryptocurrency in special online marketplaces.
The most common cryptocurrency in the world of NFTs is currently Ether (ETH). This is because most NFTs are recorded on the Ethereum blockchain. Cryptocurrencies require no involvement from central banks.
How to sell photography NFTs
Want to start creating NFTs for your photography? Whether you're already a professional photographer or just a photography enthusiast, here's how to become an NFT creator.
1. Set up a digital wallet
In order to buy or sell NFTs – regardless of whether you’re the original creator of the associated digital assets – you’ll need to set up a crypto wallet.
Even if you only plan to sell NFTs, and are not interested in NFT ownership yourself, you’ll still need cryptocurrency (typically ETH) in your digital wallet in order to ‘mint’ your tokens, ready for sale (see below).
2. Create a marketplace account
Once you’ve set up your wallet, the next step is to create an account on an NFT marketplace (see above).
Note: many of these platforms require photographers and all other users to verify their identify, typically via social media platforms.
3. Upload your digital asset (i.e. your digital image)
Accepted formats are JPG, PNG and MP4.
4. Mint the NFT
Minting your non-fungible token allocates a unique identifier (a kind of digital serial number) to it on the blockchain.
The process also requires you to add a title and description. These can never be altered once the minting is complete, so make sure you check for typos before you click the button!
Minting tokens sometimes incurs fees, known as a ‘gas fees', payable in crypto currency (again, typically ETH). This fee can vary based on a range of factors, but at the time of writing is equivalent to around $75 on Foundation.
Some marketplaces, including OpenSea, claim to offer 'gas-free' minting. However, there are plenty of other fees associated with selling, so you should expect to part ways with some cryptocurrency either before, during or after the selling process.
Once you've paid any necessary fees, you’re almost ready to sell.
5. Set the price
As always with photography, finding the right price point can be tricky. Overpricing may leave you with unsold tokens on your hands, while underpricing could mean you lose out on potential income.
Try to think objectively about the quality of your photography and the size (if any) of your following.
It’s also crucial to do your research. Find out what photographers like you are getting for their NFTs, and price accordingly.
6. List the NFT
Listing incurs another gas fee, but it’s an essential step towards making a sale. Once your non-fungible token is listed, buyers can place bids. This may be an open-ended process, or could take the form of a time-limited auction.
7. Make a sale!
Once you accept a bid for your token, you will receive the agreed quantity of crypto currency and the NFT will be transferred to the buyer.
Details of the transaction are recorded and verified by the blockchain.
Are NFTs a bubble?
Given how quickly NFTs have taken off, a lot of uncertainty surrounds them.
Can digital assets really hold value in the same way as physical ones? Can you leave an NFT to your children in your will? What’s to stop someone minting NFTs for things they don’t own, or didn't create, in the first place?
These and other similar questions have some people wondering if the NFT bubble isn’t likely to burst sooner rather than later.
NFTs: environmental impact
Another big concern about NFTs relates to electricity consumption. Cryptography requires immense amounts of computing power, which of course uses electricity and produces emissions.
So, are NFTs bad for the environment?
The Guardian recently reported that the power used in a single bitcoin transaction is equal to what the average American household consumes in a month.
Put another way, that’s around a million times more in carbon emissions than a single credit card transaction.
This will likely remain the case as long as blockchains operate on a ‘proof of work’ basis that requires blocks to be ‘mined’.
Blockchains like Ethereum claim they intend to transition to a different model – one where ‘staking’ replaces mining. Supposedly Eth2 (as it will apparently be known) will reduce Ethereum’s carbon footprint dramatically.
However, critics argue that this shift from mining to staking has been supposedly about to happen for a while now, and question whether it will actually come to pass.
For now, the main takeaway is that NFTs and the technology they rely on are arguably problematic from an environmental perspective. If being green, limiting emissions and maintaining a low carbon footprint is important to you, the NFT space may be one you prefer to avoid.
From digital art to digital assets
Are photographers really selling NFTs? Yes!
Whether this new NFT world makes much sense is up for debate. But the art world has always been unpredictable, if not unfathomable, for artists and collectors alike.
Combining the traditional market with new technology, digital artwork, digital photography, social media platforms, virtual worlds, blockchain technology, unique digital assets, crypto art, virtual auction houses, crypto currency, digital wallets and the rest was bound to lead to disruption.
Since the NFT buzz reached fever pitch, artists and photographers of all stripes have been getting in on the action and selling NFTs.
After all, if NBA Top Shots (the digital video equivalent of collectable basketball cards) can fetch tens of thousands of dollars on the NFT market, why not a digital good in the form of a stunning piece of photographic art?
Image courtesy of Pawel Czerwinski via Unsplash
Given that many photographers and artists today (if not most photographers and artists) find it relatively challenging to make a living from their photography and art, it's not surprising that NFT platforms allowing them to sell digital files are proving so attractive.
Of course, as more and more photographers flock to the NFT market, it will get harder to make your images to stand out from the pack. But if your photography is good enough, there’s no harm in giving this new market a try.
After all, selling even one NFT for a few ETH could earn you as much as several days’ work.
So if you're ready to dabble in this brave new market and try to sell NFTs – good luck!
Have you already sold NFTs for your photography? Tell us about your experiences in the comments. Feel free to post your questions, too.