CO N T ENTS New to NFTs Non Fungible Token Verified Ownership Status Collection Buying and Selling NFTs MetaMask Minting Buying on Secondary How to Buy from Opensea How to Sell on Opensea What Makes a Good NFT Project Common Scams Social Platforms The Best, First NFT Disclaimer Notes Term & Definitions Acronyms & Definitions Links 1 2 3 4 4 5 6 7 7 8 9 10 11 14 15 15 16 17 18 New to NFTs written by EC NFTea NEW TO N F Ts N F T N on Fu ng i b l e To ke n NFT, that three letter acronym that we are hearing more and more about day after day, month after month. By now, if you haven't heard of NFTs, then you must be living under a rock somewhere at the bottom of the sea. If this is the case, please share the location and tell me how can I get there? In this day and age where we are surrounded by a tech and media driven society, we are constantly hearing these newer and stranger terms being used, a few being NFTs, Metaverse and Ethereum. Regarding NFTs, we regularly hear about these funny looking monkey JPEGs that everybody and their dog wants. This is for a good reason, they are being sold daily at extraordinary prices. Word on the internet is that the highest valued monkey JPEG was sold for a staggering $2.3 million US dollars (769 Ethereum). I bet you are curious now, huh? If you have absolutely zero understanding of what an NFT is or what they do, then you’ve come to the right place. Let’s take a closer look into what an NFT is. First of all, it is important that we learn what NFT stands for There, non-fungible token, easy peasy! I know what you’re thinking though, fungible what? Before going any further, let’s break down and explore what these terms mean individually. I’m going to assume that you know what “non” means? If not, then I suggest going back to school before learning about NFTs. If yes, then let’s proceed. So , W h at D o e s N F T Actu ally Mean? 1 FUNG I B L E Fungible can be defined as, the ability of a good or asset to be interchangeable with another individual good or asset of the same type. An asset that is fungible is the best kind to use in business and commerce, a prime example is money. To help you understand, here is an example: If someone gives you one $50 dollar bill, and you give them five $10 dollar bills, no one wins or loses because the cash is fungible. You both remain equal despite the trade. The same goes for gold. If you give someone a 1 kilogram block of gold in exchange for four 250 gram blocks of gold, you would still hold the same amount of gold because they are interchangeable. Get it? In simpler terms, fungible is used to describe something that can be easily exchanged for something else of the same type and value. NON- F U N G I B LE Now that we have learnt the meaning of fungible, we can better understand what non-fungible means. Non-fungible can be defined as an asset that cannot be substituted identically for another asset. An example of this may be a car. If you swap a car for another car, even if it is exactly the same year and model, it would still not be fungible. No two cars can be identical due to potential manufacturing defects or alterations during the cars production. However, the gas put into the car is fungible. Some other examples of non-fungible assets are, real estate, original artwork and now, NFTs. TOKE N In this bizarre world of NFTs, tokens do not represent a small round shaped blue object which is inserted into the arcade machine to play a game (Sorry!). Here, NFT tokens refer to a digital certificate stored on a blockchain*. They are non-fungible digital assets that cannot be substituted with another asset, which is publicly verifiable. A blockchain is a distributed database that is shared among the nodes of a computer network where assets, Cryptocurrency and NFT transactions are recorded. BLOCK CHAIN 2 Anytime you see a blue asterisk symbol a link will follow on page 18 GOT I T . . . There are really only 3 reasons that attract people to buy an NFT. VERIF I E D OW NERSHIP Because blockchain technology is transparent, it is very simple to verify the official ownership of an asset. It also makes it easy to transfer (trade) these tokens between different owners. An NFT can only ever have one holder at a given time, hence the name non-fungible. Many people purchase an NFT for the exclusive ownership rights to brag. There are some people who love to flex and show off their laser beamed eyed monkey, which likely cost them a lot of money. We live in a very strange world. I’m glad you agree. Naturally, humans (and monkeys) have always wanted what they can’t have, or want what others have. If your neighbor has something which gives them a cool status online, you are likely to want one too. For the first time ever, NFTs have revolutionised the verified ownership ‘game’ of digital assets. People enjoy owning things that others cannot have unless they are willing to pay the price. These people love the status and exclusivity that ownership projects in certain NFT collections, which may be why they have become so popular recently. This leads us into my next point. But W hy On Ea r t h Wou l d People Want To Buy An Nft? Ve r ified Ownership 3 Co l l e ct i on Statu s STATUS Just like buying a flashy sports car, or a diamond ring in real life (IRL), people are now turning to the online (virtual) world when seeking their next opportunity to flex. Now that we are living in the Computer Age, NFTs are a natural extension for those who want to show off their wealth in the digital world, as well as in the physical world. Owning an NFT, most notoriously a Bored Ape Yacht Club (BAYC) NFT can project that same level of status as owning the newest Lamborghini. This is why we are seeing more and more people, especially celebrities, use NFTs as profile pictures on their social media platforms. Here is a short list of celebrities who own Bored Apes and have used them as their profile picture on Twitter: Tom Brady, Madonna, Justin Bieber, Jimmy Fallon, Post Malone, Neymar Jr, Kevin Hart, Paris Hilton, Snoop Dog, Stephen Curry, Shaquille O'Neil, Logan Paul, Eminem, DJ Khaled. The list goes on. COLL ECT I O N NFTs are considered to be collectible items, not much different from first edition trading cards which are now highly valuable. Certain NFTs can become extremely sought after collectibles, not because of the art, but for the community and its large following. The dots aren’t joining up for you? Okay, let me explain. Owning an NFT grants access to a community and utility (if any) that the project offers. Believe it or not, there are certain people who are willing to pay what could alternatively be used to purchase a small island, for an NFT. How price is determined is simple supply and demand. An NFT with high demand but low supply, ultimately has high value. So it really just depends on how badly you want to own it. Keep in mind that 95% of projects will end up failing and become worthless. However, the successful ones that are able to sustain high value, high demand and consistent activity over a period of time are called ‘blue chip’ NFTs. A final thing to note is that NFTs are essentially digital art. Similar to physical art, there are many collectors of digital art too. You may be surprised, but there are people who simply enjoy purchasing, collecting and storing these pieces of digital art in their Web3 wallets. Excuse me, Web 3, pardon? Don’t worry, we’re getting there. The bottom line is, people are buying NFTs regardless of how whacky the concept may seem. You might be wondering where and how you can get involved? 4 OKAY I ’ M I N T ERESTED Buying and selling NFTs isn’t much different from buying and selling any product on a secondary market place in real life. There are many market places which function quite similarly to eBay, sellers simply list and buyers then buy. The most popular marketplace for buying and selling NFTs is OpenSea. Others worth mentioning are, LooksRare, X2Y2, Genie, Magic Eden and Solanart. Different market places use different Cryptocurrencies, but we’ll leave that for now. W he re A re Pe op l e Bu y i ng And Selling NFTs And How? 5 META M AS K Let’s begin. First, you are going to need a Web3 wallet. A popular one and my personal favourite is MetaMask. MetaMask is a software cryptocurrency wallet used to interact with the Ethereum network. When you set up a MetaMask wallet, you will be given a 12 word seed (secret) phrase. This phrase is more important than remembering to brush your teeth. You ABSOLUTELY must take note of these 12 words, remember them and keep them safe, preferably offline. If you hold a lot of valuable NFTs or Ethereum, but you lose your seed phrase and cannot access your wallet, they will all be lost, forever. You will never be contacted by anyone legit asking you for your seed phrase! Once setup with a MetaMask wallet and you’ve purchased some Ethereum, you have two options when buying an NFT: 1.000 $3,120.62 1a2b3c...4d5e 6 Minting from launch Bu y i ng on se cond a ry m a r ket p l ace I Set U p a M eta M a s k , N ow What? MINTI N G No, this isn’t your favourite flavoured ice cream. To put it simply, minting means purchasing directly from a project from deployment . This means that you will be the first person to ever own that NFT. Minting is usually the cheapest way to purchase an NFT as people aim to flip (sell) their NFTs on a secondary market place for profit, therefore they are more expensive there. The mint price is determined by the project, but you must also pay an additional Ethereum gas fee. There are 3 current methods of minting, these are, Whitelist sale, public sale and Dutch Auction. BUYIN G O N S ECONDARY Buying an NFT on OpenSea is just like buying a piece of physical art on eBay. It’s simple, the seller lists the item for an asking price, a buyer then buys. Sellers always aim to sell for a profit, however this is not always the case. Unfortunately, due to the nature and volatility of the market, people often sell at a loss. To buy an NFT from OpenSea, not only does the buyer have to pay for the NFT, but also for Ethereum gas fees, project royalties and OpenSea fees. Sounds expensive I know, and honestly, it can be, but it’s all apart of the game. HOW TO M INT AN NFT 1 2 3 4 5 Purchase / add Ethereum to your MetaMask wallet or equivalent Meet the criteria of the mint Navigate to the official mint page at the correct date and time link found in Discord server whitelist spot or public mint The NFT will be transferred to your wallet Take pride in being an NFT owner and show it off Don’t panic! This can take some time 7 Note. This is all very high risk and speculative. Exercise caution and enter at your own risk. Unlike Crypto, a buyer is required in order to sell an NFT. If you cannot sell, the NFT may become worthless and live in your wallet, rent free. We call this ‘holding the bag’. HOW TO B UY FROM OPENSEA 1 2 3 4 5 Purchase / add Ethereum to your MetaMask wallet or equivalent Navigate to the official OpenSea website Find your desired collection and find an NFT that you like make sure it is the official collection as there are fake collections! https://opensea.io/ Either place a bid or buy for the asking price The NFT will then be transferred into your wallet 6 Take pride in being an NFT owner and show it off! the bid will most likely be placed as WETH (wrapped ETH) 1234567 8 It is important to know that there are two fees when you list your first NFT. One is to initialize the account for making sell orders, you will only ever pay this once per wallet address that you have. The other fee is to allow OpenSea to access your item once per collection, you must pay this each time you list a new NFT from a new collection. It’s pretty much daylight robbery. If that isn’t bad enough, each time you manually de-list an NFT from OpenSea, you must also pay a fee. HOW TO S ELL ON OPENSEA 1 2 3 4 5 Go to the official OpenSea website Find the NFT you would like to sell under the ‘profile’ section List the NFT at your desired selling price at this time you can set the duration for the sale https://opensea.io/ Wait patiently for a buyer Sell the NFT 6 Calculate the profit (hooray!) or loss (boo) 7 The NFT will be transferred out of your wallet 8 Go and buy yourself something nice with your profit sometimes this can be forever, quite literally or learn a valuable lesson from your loss Ot he r T h i ng s To Pay At tention To When Buying And Selling When you list an NFT you must pay a gas fee. You will be able to see the exact amount before listing. Try to avoid listing an NFT when the gas fee is very high, it can be very expensive L i st i ng Fe e s Each time an NFT is sold, a % of the royalties are offered to the project founders, artist, and team. Anything below 2.5% is low and anything above 10% is high. Royalties Each transaction requires a fee. The fee required to conduct a transaction on Ethereum successfully. Gas Fees 9 SOUN DS H A R D, The NFT market is hyper competitive and overly saturated with rug pulls (scams) or failing projects. Therefore, it is crucial to learn how to differentiate the good from the bad in order to succeed. There are only a select few projects which have the potential of reaching ‘blue chip’ status. Otherwise, the majority of NFT projects will almost certainly go to $00.00, becoming worthless. Again, this is termed as ‘holding the bag’ It is crucial to know what makes a good NFT project if you are looking to enter the space. There are 8 pillars that you can use as a checklist when researching a project in order to tell if it is good or not so good. By knowing what to look for and what to avoid, you can increase your chances of success. Also, by understanding how to spot red flags early, this will help you to avoid scams, which is probably the most important factor in this ‘game’. H ow Ca n I Le a r n W h at M akes A Good NFT Project? A r t Te a m U t i l i ty M a r ket i ng M i nt Pr i ce & Su pp l y To ke nom i c s Road m a p 10 COMM O N SC AMS Unfortunately, the NFT space is notoriously full of scammers and hackers. There are many intelligent people with bad intentions, and their job is to cheat you out of your money. These scammers enjoy preying on new, naive and less experienced users entering the NFT world. Not much different from lions hunting zebras. Whilst there are many good people in the space, these scammers are not your friends, but they certainly will pretend to be. These people are professional and highly skilled, they have state of the art technology and use new methods of tricking people into either handing over their hard earned money, or stealing it from them. These people wake up every morning and their daily objective is to hack, steal and scam from people like you and me. It’s awful, but it’s the reality. For these reasons, you MUST ensure that you stay up to date with the latest safety precautions. You MUST educate yourself thoroughly on how to spot these scams to stay safe when navigating the NFT world. H ow To Avo i d T he m ! Accessing your MetaMask wallet is a scammers absolute dream. If your 12 word seed phrase falls into the wrong hands, they will drain your wallet to 0 faster than you can say “seed phrase”. All of your NFTs and Ethereum will be gone into the abyss, forever. To do this, a scammer will need your 12 word seed phrase. To avoid this, simply NEVER tell anyone your seed phrase. Write it down and store it somewhere safe and offline. Careful though, don’t hide it so well that you forget where it is. M eta M a s k Wa l l et Sca m It is common to receive a Discord direct message similar to this example that claims, “you have won a whitelist spot” or “a chance to mint” a project. If you follow the link and mint, you can wave goodbye to your Ethereum. Even worse, if a link directs you to a site that instructs you to connect your wallet, and you do, your entire wallet can be drained. The goal here is to stack Ethereum and NFTs, not give them away. To avoid this, simply turn your direct messages off on Discord. To do this, right click on the server channel > privacy setting > turn direct message off. Then, delete the message, block the user and move on. Please remember, a project will never reach out to you first. It is 100% always fake! Don’t ever click on suspicious links, always exercise caution and stay safe! D i scord D i re ct M e ssag e ( DM) Scam 11 Another method that scammers will utilize in an attempt to deceive you, is by using fake accounts imitating influencers and projects. They will leave some bait in your comments section or by direct message, hoping that you will bite. Usually, they will be offering to help, or claim that they can even make you some money. I know it can be a rush when you see your NFT idol or favourite project pop up on your page, I’ve been there, but please don’t let your emotions get the better of you. If you follow their instructions, prepare for panic. You will lose the entire contents of your wallet. Remember, an influencer or project will never reach out to you first. If you are targeted by one of these fake accounts, a quick tip to check if they are legit is by clicking on their profile and looking at the amount of followers that they have. If the figure is close to 0, then the account is fake. Then, check their twitter tags, fake accounts will differ from the real ones. A good rule to follow is, if it seems too good to be true, it definitely is. To avoid this type of scam, ignore any engagement like this and return to enjoying your day and a nice cup of tea. Be aware that scammers are now buying accounts with hundreds of thousands of followers, and also with blue check ticks. This is to lure you into believing that they are verified, however, they are not. Scammers are consistently improving their methods, so you must stay one step ahead of them Fa ke I nf l ue nce r Accou nt s On Twitter and Instagram 12 Hackers aren’t restricted to social media, these cockroaches are everywhere. Another platform to exercise caution on are the secondary market places, especially OpenSea. There are many unofficial pages claiming to be the real deal, conning people into buying from them. When this happens, Ethereum goes straight from the buyers wallet, into the hacker’s wallet, never to be seen again. To avoid this, always make sure to find OpenSea links from official sources such as a project’s Discord server or Twitter page. Bonus points for checking for the blue tick which confirms that it is the project’s verified OpenSea page. Fa ke Op en Se a Co l l e ct i on Accounts Very recently, a new hack technique has surfaced. Scammers are sending out direct messages with a picture that does not load. If you attempt to load the picture but interacting with it, your Discord session token will be stolen and the hacker will change your password and control your account freely. Not even 2 factor authentication can save you from this one. To avoid not only this, but everything in the NFT space, never click on anything that you are unsure about and always get a second opinion. This is a prime example of how scammers regularly up their game, you must always stay one step ahead of them. Stay safe out there kids! These are just some common scams, there are more, so please educate yourself as best you can. D i scord D i re ct M e ssag e ( DM) Scam 13 SOCIA L PLAT FORMS W h at A re T he I m p or ta nt Platforms In The NFT Space? Twitter Twitter is the front face of any project in NFTs. It is also where the majority of information is sourced. If you are serious about getting into anything Web3, whether it is Crypto or NFTs, having a Twitter account is an absolute must. By browsing Twitter, you are able to find good projects, established people in this space and their thoughts, tons of free information, education and tips. In the beginning when researching new projects, it can be done on Twitter alone. Twitter is a one stop shop for NFT information, so be sure to take advantage of it. Discord, originally created for gamers to chat whilst playing games, has now been adopted by the Web3 community. Discord is used as a community building platform by NFT projects. Everything you need to know, literally information from A- Z about a NFT project will be in their Discord server. Discord is where community members will hang out, build connections and engage in discussions. All important announcements are made on Discord , so if you’re interested in entering the NFT space, Discord is your first place to sign up. All information provided on an NFT project’s server is official and coming from the team itself. This is the only source of information that you should trust. Discord is an amazing place to meet people with a similar mindset and common interests. NFT enthusiasts are spread far and wide, it is not uncommon for us to be isolated in our real friendship circles. Discord is a platform to build those virtual relationships which enable us to progress in the NFT world. Go get it tiger! Discord 14 I’M SO L D Whether you are new to the NFT or an advanced trader, there are certain projects that offer everything you need in one convenient place. The best example is The Magic Mushroom Clubhouse (MMC). MMC is a well rounded, comprehensive and safe entry point into the NFT space for beginners. There is much to say about the Magic Mushroom Clubhouse, founding team, and the awesome community leaders, but we’ll touch upon that more another time. If you made it this far, congratulations! You are now ready to become a full time NFT Degen. Take care, exercise caution and see you on Discord. WGMI! W h at I s T he Be st , F i rst NFT Option? Everything in this document is my own opinion. All information is for educational and informational purposes. It is not financial advice, should you decide to act upon any information in this document, do so at your own risk. Whilst this information has been verified to the best of my abilities, I cannot guarantee there are no mistakes or errors. This market moves so quickly, information in this document may be outdated very quickly. This document is a strictly confidential communication to and solely for the use of the recipient and may not be reproduced or circulated without EC NFTea prior written consent. If you are not the intended recipient, you may not disclose or use the information in this document in any way. The information is not intended as an offer or solicitation with respect to the purchase or sale of any security. D i sc l a i me r This resource was written by EC NFTea 15 TERM S & D E FINITIONS Air Drop Alpha Ape (Ape-ing into) Bearish Blue Chip Bot Bullish DAO DeFi Degen Devs Diamond Hands Doxxed Dutch Auction Etherscan Fiat Flip Floor FUD Metaverse Mods Moon Play to Earn (P2E) Paper hands PFP project Rarities Reveal Roadmap Royalties Rugpull New NFTs or Cryptocurrencies that are automatically sent to a wallet for free Having important insider information Buying in an irresponsible manner typically due to “FOMO” When you believe that a market or asset is heading downwards Well known established project that holds value over time Automated software or script built to perform specific actions When you believe that a market or asset is heading upwards Member-owned communities without centralized leadership. Not governed by one single person or entity Decentralized finance Short for “degenerate”, usually refers to people who often make risky bets Short for developers People who hold on to an asset despite price volatility and negative news When the identity of a team is revealed and verifiable for transparency A bidding technique that considers all bids received on a given asset before arriving a ceiling price, which gradually drops at specific time intervals A block explorer and analytics platform for Ethereum. Use it to verify balances, transactions, check the value of your digital collectibles and more. Government-issued currencies (e.g. USD, Euro & GBP) that are not pegged to the price of a commodity like gold When you flip something, be it an NFT or token, you buy and sell it quickly to make a quick profit The ‘floor price’ of a project is the lowest price you can buy an NFT from the collection on the secondary market ‘FUD’ stands for Fear, Uncertainty, and Doubt. A term is used to describe negative & inaccurate information regarding a project or token. A network of 3D virtual worlds focused on social connection. It’s typically a combination of multiple elements of technology, including virtual reality, augmented reality and video Refers to the moderators of Twitter or Discord channels. The role of moderators is to ensure a healthy, active and informative community experience in these spaces One of the most common financial market terms used in the crypto and NFT space, which refers to the exponential growth of an asset’s value Blockchain-based games with tradable tokens and in-game rewards The opposite of ‘diamond hands’ Shorthand for ‘profile picture’, so a ‘PFP project’ is essentially the same as a 10k project or an avatar project Digital collectables and in-game NFTs typically come with different rarities (such as common, uncommon, rare, legendary and mystic) When you mint an NFT the artwork won’t actually be created until the minting is complete The set of activities or development plans for an NFT project or P2E game Money earned by an NFT creator through the token’s resale A rug pull is essentially a scam where the team behind a seemingly legit project disappear with all the money raised immediately after launch 16 ACRO N Y M S & DEFINITIONS AMA ATH / ATL DYOR Flex FOMO Fren Fudder GM / GN GMI HODL IRL LFG NFA NGMI OG Probably nothing Pumping Rekt WAGMI Wen “Ask me anything”. Many NFT projects hold live AMA sections regularly to keep up the community engagement “All-Time high” and “All-time low”. When a NFT project or token reaches the highest or lowest price to date “Do your own research” Slang for showing off “Fear of missing out” Misspelling for “Friend” Someone who engages in FUD about a NFT project Simply means “good morning” and “good night”. “Going to make it” A misspelling of ‘hold’ used by crypto people to say that they’re holding on to their assets through thick and thin “In real life” “Let’s f***king go!” “Not financial advice” “Not going to make it” See our definition for GMI above. Slang for “original” This term is used ironically to mean “probably something important” The price or value for a token or digital asset is skyrocketing Slang term for “wrecked” “We’re all going to make it” A silly misspelling that’s used ironically by NFT and crypto communities, often in “Wen moon?” which loosely translates to “When will the price of this asset rise exponentially?” When someone promotes an NFT project and encourages others to invest in a specific NFT as a marketing strategy An agreement that automatically executes when predetermined conditions are met Buying a large quantity of the cheapest NFTs in a collection on the secondary market to raise the floor prices A word coined by combining “token” and “economics”. Tokenomics include statistics, quality and data of a token that may interest investors A fungible token that serves some use case within a specific ecosystem A measure of how much the value of an asset has moved up or down over time An idea/vision for a new iteration of the web based on a decentralized online ecosystem powered by blockchain technology Someone with a lot of capital, which grants them the power to singlehandedly move markets either upward by buying a lot from a given collection, or downward by selling Often abbreviate as “WL”, a whitelist is a special list that gains early access to an NFT drop before the general public An officially released document by a crypto project team that offers investors with detailed technical information about its concept and roadmap Shilling Smart contract (Floor) sweeping Tokenomics Utility token Volatility Web3 Whale Whitelist Whitepaper 17 LINKS Blockchain Bored Ape Yacht Club Blue Chip Projects MetaMask Wallet Buying vs Minting Whitelist Dutch Auction OS Profit Calculator Good NFT project? Avoiding Scams Discord Terms & Definitions Page 2 Page 4 Page 4 Page 6 Page 7 Page 7 Page 7 Page 9 Page 10 Page 13 Page 14 Page 16 https:/ /www.forbes.com/advisor/investing/cryptocurrency/what-is-blockchain/ https:/ /nftnow.com/guides/bored-ape-yacht-club-guide/ https:/ /drive.google.com/file/d/1_n07TnMcNd8QrTi68a33kSnhMc92djbf/view https:/ /www.youtube.com/watch?v=Af_lQ1zUnoM https:/ /postergrind.com/minting-vs-buying-an-nft-are-they-the-same-thing/ https:/ /fortune.com/2022/02/28/what-are-nft-whitelists-and-how-to-get-on-one/ https:/ /medium.com/geekculture/what-is-a-dutch-auction-and-why-it-matters-in-the-nft- space-59d5d26369f9 https:/ /opensea-nft-profit-calculator.webflow.io/ https:/ /drive.google.com/file/d/1mGyBSV51Y2umA5KKmptAhs7esMlQfUEp/view https:/ /medium.com/@maimai816/how-not-to-be-scammed-in-nfts-e8c8bb5dffc5 https:/ /zeneca33.substack.com/p/letter-23-a-guide-to-discord?s=r https:/ /www.finder.com/nft-glossary opensea.io/collection/magic-mushroom-clubhouse magicmushroomclubnft.com/ twitter.com/MushroomClubNFT 18