Buying and selling on secondary markets can be an absolute minefield where massive amounts of money can be made and lost . . . This guide is designed to help you navigate the first few moments of a collection listing, show you how to buy and sell your first NFT, and ensure you aren’t left holding the bag by offering some helpful tips.
Once a collection has sold out, it will be listed on one (or multiple) secondary markets soon after. Magic Eden is the most popular of these, but projects may also end up listing on AlphaArt, HyperSpace, Hadeswap, Solanart, Coral Cube and more.
For this guide, we’ll be focusing exclusively on Magic Eden.
You’ll first need to connect your wallet to start buying and selling on Magic Eden. Click Select Wallet in the top-right corner to do so, and the following pop-up will appear.
Once that’s done, you’ll be able to buy NFTs and sell any that are in your wallet. To sell, you’ll need to:
Click the connect wallet icon in the top-right corner. This will take you to your wallet page.
Click on an individual NFT.
Add your listed price in the box, and then press List Now.
Click Approve on the pop-up that appears.
Your NFT is now listed and will appear on the collection page. Anyone will be able to buy it.
Once a collection has been listed, it usually follows the same general pattern:
The project initially pumps as people who couldn’t mint look to buy in.
The project dumps as more and more NFTs are listed, and people seek to cash out.
From here, one of three things will happen. The project will either re-pump, dump further, or settle at a stable price (which may not be above the initial mint price).
If you’ve minted an NFT, it may be tempting to sell immediately, especially if the floor price starts above mint price.
Don’t do this. Instead, consider the following things first:
If a project has some tangible utility, it may be worth holding it rather than flipping it immediately. Projects that guarantee some form of passive income or staking usually hold their value quite well and will re-pump past the initial dump.
You’ll need to use your own judgement and DYOR when it comes to the utility of individual projects, especially if they are offering a token.
Of course, if there is no utility, it may be worth getting out during the initial pump . . .
Check the rarity of your NFT before you sell. Each NFT in a collection is assigned a ranking, based on the rarity of its attributes. A rank 100+ NFT on a relatively hyped project will go for significantly more than the floor price, although it may take a little longer to sell.
Project developers will usually list their collection on one of the various rarity tracking websites or create their own chart where you’ll be able to see exactly where your NFT is ranked in the collection.
Even if your NFT isn’t ranked particularly highly, it may still have individual attributes that are highly desirable. Magic Eden have filters designed to show the floor price of individual attributes so you can price your NFTs accordingly.
Each NFT sale will have royalties attached to it, with Magic Eden and the artist each taking a percentage slice. However, you have the ability to not pay royalties at all. This can be done by going on any collection and changing the royalties section to "none".
Some projects have prohibitively high royalties as a way to promote holding. Check these before listing, especially if you are buying and selling during a pump. You may end up selling for a loss unintentionally.
You can check the royalties by going to the buy page of an NFT and opening the Details tab.
YOUR OWN POSITION:
Arguably the most important factor. You need to consider where you stand in the grand scheme of things.
If you don’t have a lot of liquid $SOL, you should consider taking the profit, rather than pushing your luck. If you do hold, you may end up making massive gains. Or massive losses . . . Do your own research and don’t over-invest.
If you’re just starting out in this space, this advice is even more relevant. Start small and get a feel for the market first.
Buying is just as simple:
Navigate to the collection you want to buy.
Click on the NFT you want to buy.
Click Buy now.
A following approval pop-up will appear. Click approve.
Congratulations. You’re now the owner of a shiny, new NFT. Original post was made by Stokesy, over on Medium, for The Asylum. See attached links: Medium - https://medium.com/@theasylumdao/the-asylum-guide-buying-and-selling-on-secondary-markets-4c26fb3fee5 The Asylum - https://twitter.com/AsylumDAO
Stokesy's Twitter - https://twitter.com/StokesyGT