Where To Buy NFT Crypto – How To Buy NFT Crypto Coins For Beginners In 2022

Fact Checked by Gary McFarlane

Most of us didn’t really know about NFTs until the early months of 2020. And since then, the NFT space has grown exponentially – as of this publication, the total market capitalization of NFT Cryptos is about $53.83 billion. This guide will cover how to invest in the NFT and metaverse space without necessarily buying NFTs.

#1 Broker to Buy NFT Cryptos – eToro

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What are NFT Cryptos?

NFT Cryptos are cryptocurrencies native to blockchain ecosystems that deal with minting NFTs, blockchains specifically created for NFTs, blockchain gaming, and NFT marketplaces. There are over 460 NFT cryptos, all of them native to different NFT projects. Here are a few examples. MANA is the native token for the Decentraland metaverse, ENJ for Enjin marketplace, AXS for Axies Infinity blockchain gaming, and FLOW is the native token for the Flow blockchain. 

Remember not to mistake NFT cryptos for NFTs or NFT art collections. NFTs are unique crypto assets representing digital or real-world assets ownership, and no single NFT is interchangeable with another, even if they are from the same collection. NFT cryptos, on the other hand, are fungible. 

Where Can I buy NFT Cryptos?

Before we review the top three exchanges where you can buy NFT Cryptos, let’s first review the different types of exchanges that you need to know. Generally, there are three categories of crypto exchanges – centralized crypto exchanges, decentralized crypto exchanges, and hybrid crypto exchanges. 

Centralized Crypto Exchanges (CEX)

CEXs are similar to traditional stock exchanges where buyers and sellers converge in one marketplace. Centralization, in this case, refers to the use of an intermediary or third party to help conduct transactions. Buyers and sellers rely on this intermediary to match their orders; if you’re buying, the exchange matches you with a seller and vice versa. 

Typically, centralized crypto exchanges often comply with strict Know Your Customer (KYC) and Anti-Money Laundering (AML) regulations, as they allow deposits and withdrawals in fiat currencies. However, they dominate the overall crypto trading market in terms of volume traded. Some of the leading centralized crypto exchanges include eToro and Coinbase.

Decentralized Crypto Exchanges (DEX)

DEXs are online crypto trading platforms built on blockchain to facilitate peer-to-peer crypto trading as they do not rely on intermediaries. These exchanges embody the true philosophy behind cryptocurrencies – absolute privacy. In their simplest form, these exchanges can be considered cryptocurrency trading platforms that allow their users to exchange cryptos directly and anonymously. However, DEXs rarely accept fiat currencies, and no KYC or AML policies are required. 

Hybrid Crypto Exchanges

As the name suggests, a hybrid crypto exchange has both CEX and DEX properties. They aim to provide the privacy and security of a DEX with the functionality and liquidity of a CEX. Most crypto enthusiasts believe that hybrid exchanges are the future of crypto exchanges. 

How to Buy NFT Cryptos – Step by Step Guide 2022

If you’re interested in NFT Cryptos, here’s a simplified guide on buying them from the best crypto exchange – eToro.

  • Step 1: Register for an eToro account: eToro is one of the most convenient exchanges for beginners to buy NFT Cryptos. Go to etoro.com and click on the “Join Now” tab to sign up. Experienced users can also access the professional-grade eToroX crypto trading exchange. 
  • Step 2: Account verification: Once you have signed up, you must verify your account complies with KYC policies. This means you must provide a copy of your proof of address (national ID, passport, or driver’s license) and proof of residence (utility bill or a bank statement). 
  • Step 3: Deposit funds into your account: After eToro verifies your live account, you can add funds. To deposit, click the “Deposit Funds” on your dashboard. eToro allows deposits via bank transfers, debit/credit cards, PayPal, Skrill, or Neteller.
  • Step 4: Buy NFT Cryptos: To buy NFT Cryptos on eToro, search the NFT crypto you intend to buy and click the “Trade” tab. Enter the amount you intend to use to buy the crypto and click “Open Trade.” Note that you can trade cryptocurrencies on eToro 24/7. 

After buying your NFT Cryptos, you can transfer them to an external crypto wallet, the eToro Money crypto wallet, or leave the cryptos in your eToro account. 

Where to Buy NFT Cryptos – Choose an Exchange

CoinMarketCap tracks about 304 crypto exchanges, which gives you a diverse option to choose from. Whether you prefer centralized or decentralized crypto exchanges, there is plenty to choose from. However, some crypto exchanges may not be the best for you, depending on your geolocation. Here are our top three picks for the best crypto exchanges. 

1. eToro – the Best Overall NFT Cryptos Exchange

eToro

Crypto trading on eToro began in 2013 with trading bitcoin CFDs. However, it wasn’t until 2017 when users could buy and sell the underlying cryptocurrencies in the spot market. In 2019, the eToro group launched its professional crypto exchange platform – eToroX.

Security

Crypto assets are highly vulnerable to cyber threats than any other financial asset. That’s because crypto transactions are irreversible and can be anonymous, which means if your crypto wallet is compromised, a hacker can anonymously transfer all your assets. This is why eToroX maintains a thorough Global Information, Privacy, and Cybersecurity Policy. It has partnered with GK8, a world-leading provider of military-grade cybersecurity solutions, offering a custodial cold storage Custody as a Service (CaaS) solution for all its clients’ crypto assets. 

eToroX has strict KYC and anti-money laundering policies combined with state-of-the-art cyber threat intelligence capabilities to guarantee the protection of user assets and data. 

Features

For crypto traders, one of the most outstanding features of eToroX is the eToro Money crypto wallet, which is available on the mobile version for Android and iOS devices.  This is an easy-to-use, multi-crypto, secure digital crypto wallet compatible with over 120 cryptocurrencies. The wallet is a self-sufficient ecosystem since users can conveniently convert more than 500 crypto pairs into any crypto asset, within the wallet, without transferring the assets anywhere else. Other than cryptos, eToro Tokenized Assets are available. These are 17 unique ERC-20 tokenized fiat stablecoins and two commodity stablecoins backed by USD and monitored by KYT tools. Users have access to eToro’s Delta Investment Tracker, a mobile app that allows them to track and manage their portfolios live. They also enjoy eToro staking, which allows them to earn interest on the crypto assets they HODL. Users can stake only ADA, TRX, and ETH on eToro. 

Although eToroX is a subsidiary of eToro, it is not subjected to similar regulations by FCA, ASIC, CySEC, FINRA, and FinCEN. However, eToroX is regulated by the Gibraltar Financial Services Commission (GFSC).

eToroX Fees

Fee Type Amount
Wallet fees Fiat to crypto conversion: 5%
Withdrawal fees Depends on the asset.
Exchange fees inverted maker-taker model: 0.05%

 

Pros

  • Regulated
  • Free access to the eToro Money crypto wallet
  • Fast and convenient crypto-to-fiat withdrawals 
  • eToro crypto staking

Cons

  • It can be tedious to transfer cryptos to the eToro Money crypto wallet
  • No insurance cover for non-CFD crypto assets

68% of retail investor accounts lose money when trading CFDs with this provider.

2. Coinbase – the Best Centralized Crypto Exchange

Coinbase was established in 2012, making it one of the oldest crypto exchanges, and it is operational in over 100 countries globally. Although Coinbase is strictly for trading cryptocurrencies, it offers multiple ancillary services to its clients.

Coinbase review

Security 

Protecting your data and your privacy are essential priorities for Coinbase. And although Coinbase is a custodial exchange, it has taken precautions to ensure that your wallet’s private keys are never lost. When you generate your private key, Coinbase segments it into “shares” using Shamir Secret Sharing (SSS) and deletes the full key for extra security. The segmented bits are stored by different parties, ensuring that no one has the full key, maintaining the highest level of security for your crypto assets. It also uses secure online and offline servers to secure its clients’ digital currency from hackers. 98% of the customers’ digital currency is in cold storage. The remaining 2% is held in secure online servers to ensure that its customers’ liquidity needs are met. It has commercial, criminal insurance for an amount greater than the 2% held in online servers. The insurance covers any breach of Coinbase’s cybersecurity, physical security, and theft by Coinbase employees. The insurance doesn’t cover any crypto stored in your private wallet. All USD cash balances held in user accounts are covered by FDIC insurance, up to a maximum of $250,000.

Coinbase is also licensed in the US and the EU in compliance with money transmission regulations. It adheres to strict money transmission and e-money regulatory compliance globally from top financial sector regulators. In the US, it adheres to the Bank Secrecy Act, the USA Patriot Act, and money transmission laws in every state and is registered as a Money Services Business with FinCEN. The FCA also authorizes it in the UK under the Electronic Money Regulations 2011.

Features 

Some of the key features available on Coinbase are the Coinbase wallet, merchant solutions, and Coinbase Pro. The Coinbase wallet is only available as a web extension that allows users to explore the decentralized web directly from their mobile devices or browser. It is a self-sustained ecosystem compatible with over 4000 cryptos and NFTs. And since it is a self-custody wallet, you are effectively in control of your private keys and data. 

The Coinbase merchant solutions help merchants accept crypto payments on their websites by connecting them to the content management system (CMS) via dedicated plugins. 

Coinbase Fees

Coinbase charges a maker-taker fee depending on the value of the transaction. However, users of Coinbase Pro enjoy lower fees in general. 

Fee Type Amount
Wallet fees Fiat to crypto conversion: 1.49% to 3.49%
Withdrawal fees Up to $25
Exchange fees Maker-taker model: 0.04% to 0.5%

 

Pros

  • High liquidity
  • Regulated
  • Insurance cover 

Cons

  • Complicated fee structure 
  • No privacy since Coinbase monitors all financial activity in users’ accounts.

68% of retail investor accounts lose money when trading CFDs with this provider.

3. Uniswap – The Best Decentralized Crypto Exchange

Uniswap is the largest DEX operating as an open-source protocol on the Ethereum blockchain. It provides liquidity and trading services for ERC-20 tokens by eliminating intermediaries’ needs, thus guaranteeing safe, accessible, and efficient exchange activity. Uniswap V1 was launched in November 2018 and has since evolved to Uniswap V3, which went live in May 2021. Over $700 billion has been traded on the DEX in such a short time –the explosion of decentralized finance has driven its popularity. 

Uniswap review

Security

As a DEX, the primary objective of Uniswap is to guarantee secure, anonymous, and censorship-free transactions. Uniswap V3 is a binary smart contract system with several libraries that make up the DEX’s Core and Periphery. The design of the core contracts is to guarantee safety for all transactions on Uniswap. The Periphery contracts only interact with the core contracts to provide clarity and enhance user safety. It also offers a bug bounty reward of up to $500,000. 

In terms of privacy, Uniswap doesn’t collect user data. No account registration is required; all you need is to connect a web3 wallet such as MetaMask to Uniswap and start swapping cryptos. Note that Uniswap is not under any regulation in any jurisdiction globally. However, changes in the DEX can be achieved through voting. Voting is a privilege of the holder of the UNI token, which is the DEX’s native token. This ERC-20 token dictates the weight of a holder’s voting right; hence, the more UNI one holds, the more voting rights they have.

Features 

Uniswap isn’t just a DEX; it’s a whole ecosystem in one place. It has over 300 integrated DeFi apps allowing users, developers, traders, and liquidity providers to participate in an open and censorship-free marketplace. Developers can freely build dApps on the Uniswap protocol. As a blockchain ecosystem, democracy prevails here – the protocol is governed by UNI token holders and delegates. 

Uniswap Fees

Unlike many other exchanges, Uniswap does not work with order books but calculates the price of a token from the available liquidity pools. 

Fee Type Amount
Wallet fees ETH transaction subjected to gas fees
Withdrawal fees Depends on the Web3 wallet used
Exchange fees 0.3%

 

Pros

  • No registration needed
  • Community governance
  • Uses smart contracts 

Cons 

  • High ETH gas fees
  • Only supports ERC-20 tokens
  • High instances of scam cryptos 

68% of retail investor accounts lose money when trading CFDs with this provider.

What are the Different Ways to Buy NFT Cryptos?

Now that you’re familiar with the top crypto exchanges let’s discuss the two ways you can buy NFT Cryptos. 

Buy NFT Cryptos CFDs

CFD stands for contract for difference. These are derivatives whose price mimics the underlying asset – in this case, the NFT cryptos. When you trade NFT Cryptos CFDs, you don’t own the underlying cryptos but only seek to profit from the price fluctuation on the underlying NFT Crypto. That means you can buy the CFDs in a bull market and short them in a bear market, allowing you to profit regardless of the market trend. 

The popularity of CFDs among shorter-term traders is specifically because CFD trading allows the use of leverage. With leverage, traders can significantly increase their profitability. However, the downside is that traders need to implement proper risk management measures since the higher exposure with leverage also increases the potential losses. 

Buy NFT Cryptos

You can also buy the actual cryptos from exchanges and store them in your crypto wallet. This is similar to investing in the crypto projects tied to these cryptos. The value of the NFT crypto is usually tied to the performance and market demand of their ecosystems. Naturally, when the underlying projects perform well, the cryptos appreciate. The downside of owning the cryptos is that your portfolio will take a hit during a prolonged bear market. However, owning the cryptos makes for an ideal investment in the long term – for example, between January and December 2021, the market capitalization of the top NFT Crypto – MANA – increased by over 5900%. 

Are NFT Cryptos a Good Investment?

We have witnessed the boom in the NFT space over the past 2 years, and the primary beneficiary of this boom has been the NFT Cryptos. As we mentioned, the value of NFT Cryptos entirely depends on the performance and demand of the underlying project. If you’re still on the fence about whether NFT Cryptos are a good investment or not, here are the reasons why they are. 

You can Earn Passive Income with NFT Cryptos

One of the greatest advantages of decentralized finance (DeFi) is that crypto holders can earn passive income through liquidity mining, staking, and yield farming. Usually, when you buy the NFT Cryptos, you transfer them to your wallet and wait for the price to appreciate. Thanks to DeFi, you can still HODL your crypto while earning significant interest on them. Coinbase and eToro allow staking of your NFT Cryptos, while Uniswap is the best platform for yield farming and liquidity mining. 

The Metaverse is Growing

For diehard crypto enthusiasts, blockchain and metaverse are bound to dominate nearly every aspect of our lives – we’ve already witnessed multinationals like Facebook pivoting into the metaverse. As the use cases for NFTs and metaverses evolve beyond the current use in digital arts and blockchain gaming, the price of NFT cryptos is bound to appreciate too. 

Buying NFT Cryptos – What are the Risks?

Despite the rosy future of NFTs, there’s no dispute that they are still a nascent experiment in the world blockchain, which means investing in NFTs isn’t without its risks. 

Overvaluation

There’s no doubt about the hype surrounding the NFT space right now. And while that may be a good thing, it inadvertently creates a price bubble for NFT cryptos. Currently, most NFT projects have no intrinsic value other – they are mere speculative assets. In a market almost entirely driven by FOMO and FUD, the artificial hype surrounding them gets in the way of efficient price discovery. More so, NFT holders can easily manipulate the price of NFT collectibles to create the illusion of high demand. A good example of this was the recent sale of CryptoPunk 9998 for $530 million, which turned out to be a well-orchestrated scheme to inflate the price of the NFT. 

How to Buy NFT Cryptos with eToro

Here is an in-depth guide on how to create a trading account with eToro and buy NFT cryptos.

Step 1: Create an account with eToro

Go to eToro, click on the “Join Now” tab, and continue the straightforward registration process.

Register trading account on eToro

Step 2: Verify your eToro trading account

After you sign up, you need to verify your account in compliance with KYC policies. This means you must provide a copy of your proof of address (national ID, passport, or driver’s license) and proof of residence (utility bill or a bank statement). 

Verify eToro live account

Step 3: Deposit funds into your account

After eToro verifies your live account, you can add funds. To deposit, click the “Deposit Funds” on your dashboard. eToro allows deposits via bank transfers, debit/credit cards, PayPal, Skrill, or Neteller.

Fund eToro account

Step 4: Buy NFT Cryptos

To buy NFT Cryptos on eToro, simply search the crypto you intend to buy and click the “Trade” tab. Enter the amount you intend to use to buy the crypto and click “Open Trade.” Note that you can trade cryptocurrencies on eToro 24/7. 

After buying your NFT Cryptos, you can transfer them to an external crypto wallet, to the eToro Money crypto wallet, or simply leave the cryptos in your eToro account. 

Buy NFT cryptos on eToro

How to Buy NFT Cryptos – Conclusion

Investing in NFT cryptos offers the ideal way to invest in the NFT ecosystem without necessarily owning any NFTs. This guide has discussed all you need to know about NFT cryptos and how and where to buy them. Remember that the value of the NFT cryptos are usually tied to the performance and market demand of their ecosystems. For example, the value of AXS appreciates as the demand for the NFT-based online video game Axie Infinity grows.

NFT stocks are the future of online investing, and our guide will show you how to get in on the action! Our easy-to-follow guide makes it simple to get started. So what are you waiting for? Invest today!

eToro – Best Broker to Buy NFT Cryptos

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About Samwel Fedha PRO INVESTOR

Fedha Samwel is a freelance financial analyst with over 5 years of experience covering the global stock market, Forex, crypto, and macroeconomics. He is currently pursuing a CFA charter and is an avid champion of simplifying the intricate world of finance for all.