Looking for a place to trade cryptocurrencies? Different exchanges are tailormade to suit different types of traders. Some are so simple that adept trailers will find them unusable, while some are too technical that new investors will see clueless.
Binance is one of the few exchanges that has gotten the balance between the two types of traders. Its user interface is simple, yet it contains enough technical tools for adept traders. This is why it is the largest exchange in the world by daily volume. It is also the best exchange in the world by several other metrics. Its latest offering is a non-fungible token (NFT) marketplace, and it has transferred the excellence in spot and derivatives trading to its NFT platform. The question we see to answer in this piece is “How can you buy NFTs from Binance?” What other things do you need to know?
New ways to purchase NFTs
Binance NFT is one of the best places for buying, trading, biding, collecting, and minting digital collectibles. It leverages the exchange’s robust blockchain infrastructure and large user base to explore the other arm of blockchain technology; digitization and record keeping of art and various types of unique digital items.
Here is a comprehensive step-by-step guide to buying NFTs on the Binance platform.
Use the fixed price or bid in the NFT auction.
There are two primary ways of obtaining NFTs on Binance. The first one includes paying a fixed price on a listed NFT and acquiring ownership of the digital collectible in that way. The second one allows you to participate in the auction process, which offers the upside of potentially spending less money on the NFT.
We’ll examine the NFT buying process in the following steps.
Open the Binance NFT marketplace.
Click on the search icon at the top of the page to look for any creator or project of your choice.
On the creator’s page, click on collected to toggle between “Created”, “Collected”, and “Favorites”.
To buy from a collection, click on the collection and scroll through the listed tokens.
If you have seen one you like, you can make an offer for it. After the auction period, your token will be sent to your wallet if your bid is successful. If your bid is unsuccessful, your crypto will be sent back to you.
In general, Mistery Boxes allow users to purchase NFT items from a particular collection, albeit not knowing exactly which item they are going to receive. Mystery Box can include a rare and expensive item, or a common and subsequently less valuable digital item. In this sense, Mistery Box is a perfect choice for users that enjoy an element of luck and surprise when buying NFTs.
There are a few times that a Mystery box is put up for sale. In these cases, you can buy through auctions or direct purchases. You can also reach out to a seller if you want a particular mystery box and it is not listed.
What are the differences between Standard and Premier NFT collections?
While buying an NFT on Binance, it is important to know that there are two categories. The first is called the standard collection, which refers to collections not verified by the Binance NFT marketplace. The Premier Collection, the other type, is verified as legitimate by Binance.
How do you know the difference between these two categories? Simple! The premier collections have an orange swish mark beside the collection names. The standard ones, on the other hand, do not have this mark.
Using Binance filters to explore the NFT marketplace
With the boom in NFTs, you may find it difficult to get a list of NFT collection options which you can choose from. Before you get to that stage, you can click on ”Marketplace”. Here you will see several filters which you can use to gauge your buying choices. There are leaderboards on sales, volumes, creators, and top collections.
Even with these, you can still assess the value of the project you want to buy using the floor price, volume, and the last price sold. We’ll dive into the importance of various NFT market metrics in the following section.
Why analyzing NFT metrics is important
If you see any collection you are interested in buying and already trust the team behind it, here are some quantitative things you need to know while analyzing them. This method of analyzing looks more into pricing and quantity.
Apart from these, you can also use other qualitative methods to evaluate projects. Let’s examine the quantitative analysis methods.
Like in buildings, the floor price refers to the lowest price the tokens in a collection can sell for. It is widely used to know the entry cost for a collection.
The floor price is a fundamental way to gauge the supply and demand for a project. When the supply exceeds the demand, the floor price will reduce when the supply exceeds the demand. When the demand is higher, the floor price will be raised.
When you buy any token in a collection, the goal is for the floor price to increase; only then can you make a profit off your investments.
A good tip in buying NFTs is to look for a project that, to a large extent, balances value and accessibility. They might be expensive for smaller traders to own, but if you can have one, you’re good to go.
Estimated market cap
You might wonder what’s the combined value of digital collectibles belonging to a particular NFT collection. If that’s the case, you can get the rough market cap estimate by multiplying the trading price for the last 7 days by the total supply.
The NFT Supply talks about the pieces of NFT in the collection. The supply is fixed and is usually known before the collection is launched.
Primarily, the supply affects the value of a collection. When a collection has a low number of tokens, it is seen as more valuable due to its scarce nature and rarity. The opposite applies to a token with a high supply. More often than now, it tends to have a lower market value.
Out of the tokens in a collection that has been minted, how many have been sold? This metric will help understand the past and present interest in the project.
An NFT project with more recent sales is a good sign. This shows that there is increasing interest in the project. However, often, the reverse is the case. When the recent sales are high, but the sales are below the floor price or is a sign that people are exiting the project due to panic selling or dwindling interests.
The attributes and properties that an NFT possesses within a specific collection impact its rarity. This information can also indicate how difficult it is to obtain a particular NFT.
With the rarity rank, you can ascertain an NFT’s value in the collection.
Buyers are typically more attracted to rare NFTs, which in turn often generate more trading volume and buyer interest. Rare items can also offer extra perks, like better items in play-to-earn games, and other real-life benefits.
The volume refers to the demand for the collection. Better-known projects tend to have higher demands and trading volume.
Volume does not look at the social media hype. Rather, it shows people’s buying interest in a project. For a project’s volume to be high, it means people are buying and selling.
The volume also shows the liquidity of the market. A more liquid market has more volume, meaning when you buy, there is a higher chance of having a ready buyer when you’re interested in selling. Easy entry; easy exit.
The ceiling price is the opposite of the floor price. While the latter looks at the lowest price for an NFT, the ceiling price is the highest price an NFT in the collection was sold for.
It is not advisable to buy the top (ceiling price), but often, it is a high-risk, high-reward strategy.
The most expensive tokens usually have the rarest traits. If you want to spend so much on an NFT ceiling, you would generally make money if the project succeeds. If it turns out otherwise, you can lose the most on the project.
Since NFTs are transparent in nature, you can see the history of previous owners and trace it back to the creator.
The legitimacy of an NFT is seen in its provenance. You can see the changes in ownership and trace the token back to the owner. Also, you can see how much was spent to acquire the token throughout its existence.
Without a smart contract. It is practically impossible to sell an NFT. Why? Smart contracts can be thought of as blockchain-embedded software. They make it possible to mint, buy and sell an NFT and even generate passive income through royalties, all without the help of an intermediary.
With a smart contract, the records of the NFT from inception are secure and Immutable.
The copyright to the NFT still remains with the creator, no matter what purchaser has it. The only exception to this is if it is written in the smart contract.
An advantage of Binance NFT is that you can quickly check up on the NFT, the wallets attached, and the smart contracts. Moreover, you can get linked to the Binance scan (BSCscan) when you click on the contact address on an NFT. This will help you validate the collection’s authenticity and check for the latest collections.
The bottom line
Binance NFT is one of the more feature-rich digital collectible marketplaces in the sector. Beyond numerous features and a vast catalog of listed NFTs, the marketplace features a streamlined interface and access to various trading metrics that can help you assess the value of NFTs and identify potentially lucrative investment opportunities.
In a bid to grow the adoption of NFTs, Binance is offering a unique way of appreciating users who completed their KYC. Starting with July 1, 2022, users who successfully complete KYC receive a special NFT as a reward. The holders can use the NFTs to claim rewards on the ecosystem. They can be claimed within 2 weeks after registration and completion of identity verification.
Hopefully, this article managed to answer the question of how to buy NFTs on Binance and aid you in some capacity on your NFT collecting and trading journey.