A non-fungible token or NFT is a unique entity on a blockchain that represents an asset. Although NFTs can be used to prove the ownership and authenticity of just about anything, they are currently used primarily for art, particularly digital art. The cost for creating an NFT will vary depending on the type of blockchain the NFT is on and the market fees for listing and selling.
Because most people consider beauty the defining quality of art, the tried-and-true saying “Beauty is in the eye of the beholder” has long been taken to mean that “Art is in the eye of the beholder.” As a result, beholders’ impressions have long been used to determine both the quality of art and how to price it. Since the sprouting of human civilization, people have been making art. And, probably for just about as long, people have tried to sell or trade their art for something in return. Around the world today, investors, collectors, and art dealers trade billions of dollars worth of fine art.
Throughout history, if you wanted to own a piece of art, you would go to an art dealer, buy the art, then display it in your home or place of business, or store it someplace safe. Maybe you would hold onto the art and pass it through to the next generation, or maybe you would sell it when you could make a profit. In today’s world, society has digitized the sale of art, in particular digital art. NFTs or non-fungible tokens have facilitated this change.
So, what if you are (or a friend you could go into business with is) a creator of digital art you think could sell? Might tokenizing that art for sale as NFTs be a viable option for you? To help you decide, this article will tell you what it costs to create (or “mint”) NFTs on common blockchain platforms. Before doing that, however, we’ll need to cover some basics.
From NFT prerequisites to NFTs 101
Some discussions of NFTs get confusing because they dive right into talking about them without first covering essential prerequisites. We’ll avoid doing that here.
Tokenization, tokens, and fungibility
In the broadest, simplest terms, to tokenize is to make into, associate with, or represent using a token. But what is a token? A useful resource that many people neglect when learning about a topic like this is the dictionary. A standard and respected dictionary like Merriam-Webster’s provides definitions of terms based on how the general public is actually using those terms.
Among Merriam-Webster’s definitions of “token” are three worth noting:
- “something given or shown as a guarantee (as of authority, right, or identity),”
- “a piece resembling a coin issued as money by some person or body other than a de jure government,” and
- “a unit of a cryptocurrency.”
Merriam-Webster’s example for the last of these definitions identifies units of Bitcoin as “Bitcoin tokens.” Tokens must be fungible to function as currency meaning any token of a certain kind can be exchanged for any other. Every Satoshi (one one-hundred millionth of a Bitcoin, or 0.00000001 BTC) is the same as another, just as one U.S. dollar has the same value as another. Cryptocurrencies, then, are fungible tokens. Rather than represent assets separate from themselves, these tokens typically are the assets. Like such unbacked paper currencies as U.S. dollars, they do not represent or stand in for physical commodities. Instead, they represent abstract value only.
NFTs are digital tokens on blockchains, Just like cryptocurrencies. NFTs are not fungible. They are tokens that prove or guarantee ownership or authenticity, but they are not interchangeable and, thus, cannot be used as money. Each is unique. An NFT may represent a physical property, such as a painting, in which case it is proof that you (and you alone) own the real-world painting. An NFT may also represent a digital work of art that has itself been recorded on the same blockchain as your record of ownership.
So, when speaking of NFTs, we can speak of tokenization less broadly and simply as the act of taking a whole asset (or part of an asset) and creating a token to define ownership. The token, or proof of ownership on the blockchain, can be traded to other parties just like any normal asset. Because the token is proof of ownership, trading it means trading the asset it represents. In common usage, in fact, and in most of this article, NFTs and the assets they represent are spoken of as one and the same. This is particularly so in the case of digital assets, such as digital art, even though, technically, the proof of ownership and digital work of art may exist as separate records on the blockchain.
NFTs to prove ownership and trade assets
To recap and expand on what we’ve learned so far, NFTs are a form of financial security based on tokenization on a blockchain, which is an open and distributed digital ledger. NFTs, represented by records on the blockchain, can irrefutably prove ownership. Thus, NFTs make it possible to mark your ownership of an asset in an open, apparent, irrefutable way using blockchain technology.
NFTs can be hosted on a number of different blockchains. However, Ethereum and Solana are the most popular blockchain platforms for hosting NFTs. The prices for NFT minting (creating NFTs) on different blockchains vary over time. Furthermore, if you are looking to create an NFT for the purpose of marketing it with the hope of a sale, then there will be listing fees associated with different online marketplaces.
Blockchains from Bitcoin to Ethereum
Most people nowadays have heard of Bitcoin. Bitcoin was the original cryptocurrency. By enabling proof of ownership of a new digital asset through code sequences on a blockchain or distributed public ledger, it created a new way to store value, prove ownership of that value, and exchange that value for goods or services. Although Bitcoin’s ultimate goal is to be used alongside or in place of fiat (government) currency, its primary use today is as a way to store value. It also has some popularity as a speculative vehicle for traders.
Ethereum, which is the second most popular cryptocurrency, took things a step further. Ethereum uses the blockchain both to prove ownership and to facilitate things such as smart contracts. Smart contracts are decentralized contracts on the Ethereum blockchain that allow agreements to be entered into in a decentralized fashion. Ethereum is also designed so that other decentralized applications, including other cryptocurrencies, can be built on its blockchain.
Though all cryptocurrencies involve tokenization of value, tokenization of unique assets through tokens that are not fungible is a newer innovation. According to Merriam-Webster, in fact, the terms “non-fungible token” and “NFT” were not first used until 2017.
Complex investments profit from professional advice
Not every professional investment advisor may yet be well versed in NFTs or in blockchain technology and related investments more broadly. You can expect, however, that more and more will be adding this knowledge to their toolboxes in the near future.
Are NFTs the right route for you to take to secure your financial future? Or might you better benefit from more traditional investments? One good way to work through these questions is to take the time to consult with a professional investment advisor.
NFTs for digital art
As you’ve learned, NFTs are non-fungible tokens. They enable you to prove ownership of assets via sections of code in the public ledger. Although first featured on the Ethereum blockchain, there are several other blockchains that will also host NFTs. NFTs can represent anything. They can represent a song you wrote, a video you made, or art that you created. Particularly in the case of digital art, NFTs broke a longstanding barrier.
Proving you own what’s purely digital
Digital art in prior years was very difficult to own. If you had a cool drawing of a frog on your cell phone, then there were probably another 1 million people who also had it on their phones. If you wanted to determine who owned that picture, how could you do so irrefutably? To say the least, this wasn’t easy. NFTs changed this by associating ownership of a piece of digital art with the blockchain. Although anyone can look at digital art, the ownership of a specific piece of such art can be defined by a blockchain entry that cannot be altered.
Buying and selling purely digital possessions
The blockchain entry defining ownership of a piece of digital art is what “changes hands” when one person sells a piece of digital art — or any NFT-secured asset. In a sense, people trading NFTs just buy and sell sections of code on the blockchain. Owning one of these sections of code makes you the owner of whatever asset it represents. In the case of digital art, that asset may be just a digital image (or audio or video file) recorded on the same blockchain.
The first step to creating your own NFT is to mint one. In most cases, minting will be the process of uploading digital art from your computer and then linking it to a blockchain by creating, and minting NFT. The NFT minting cost will differ depending on the blockchain. Ethereum is the most expensive blockchain. When this article was prepared, it cost $70 on average to mint an NFT on the Ethereum blockchain. Solana is one of the cheaper NFT hosting blockchains, only costing an average of $.01 on the same date. Here’s what the prices to mint an NFT on various blockchains were at the same time:
|Blockchain||Cost to mint an NFT*|
|Cost in Cryptocurrency||Cost in Dollars|
|Ethereum (ETH)||0.01–0.05 ETH||$50–$150|
|Solana (SOL)||0.00001 SOL||$0.01|
|Polygon (MATIC)||Free, but subject to marketplace fees||Free, but subject to marketplace fees|
|Tezos (XTZ)||.08–3.6 XTZ||$0.20–$8|
|Cardano (ADA)||.17–1.5 ADA||$0.13–$1.15|
|WAX (WAXP)||0.13–13 WAXP||$0.05–$5|
|Avalanche (AVAX)||0.008–.02 AVAX||$0.50–$1.50|
|Zilliqa (ZIL)||0.7–2.9 ZIL||$0.05–$0.20|
NFT minting cost breakdown
The cost to mint an NTF will include an account fee charged by whatever marketplace you use and a so-called “gas fee,” which is an extra charge included to cover the cost of your use of the computer resources on whatever blockchain you use. For simplicity, this article’s examples will disregard the account fee and look only at the gas fees for minting.
Cost to list Vs. cost to create
You should also note that many explanations of minting costs will include the listing fee as part of the minting cost. Since the listing fee is what you pay to put your NFT up for sale in the marketplace, treating it as part of the cost to create the NFT is nonsensical. Nevertheless, it is very common, possibly even the norm. We believe the confusion arises because NFT marketplaces where you create (mint) NFTs may not allow you to mint NFTs without also listing them for sale.
Why do NFT platforms minting prices differ?
The key to NFT pricing is to understand how different blockchains operate. This requires understanding how the computers comprising a blockchain network reach an agreement in a secure way that ensures all records added to the permanent ledger are valid. Different approaches to this can affect the speed of transactions, their security, and their cost.
A central feature of blockchains, in fact, the central innovation that permits an open ledger (distributed database) to be secure without anyone having to trust a central authority, is what are called consensus mechanisms. Computers that contribute to and maintain a blockchain — such as by creating new units of currency or new NFTs and validating transactions of every sort — are called nodes. The nodes of a blockchain network must have some way to reach an agreement on which transactions are valid and should be added to the persistent record and which are not.
Since its inception, the Ethereum blockchain has used proof-of-work. At the time this article was prepared, plans to change this had been announced (see the “Pro tip” below), but we’ll use Ethereum as our example of an NFT platform using proof-of-work since that is what it has been historically.
Proof-of-work secures blockchain transactions, and so the blockchain as a whole, by requiring machines that contribute to and maintain the blockchain to perform work, which typically means solving difficult cryptographic problems. Minting NFTs on the Ethereum blockchain has long meant using proof-of-work. It’s cryptographic proof that any node permitted to contribute to the blockchain is genuine and trustworthy. Nodes that can add blocks of transactions to the blockchain are called “miners” in proof-of-work networks.
Because computational work that solves cryptographic problems is not something one can fake, proof-of-work consensus mechanisms are extremely secure. Some people, in fact, such as “Bitcoin maximalists” (Bitcoin, too, uses proof-of-work), do not believe that any other consensus mechanism provides the same level of security as proof-of-work. But because this mechanism requires nodes to do complex computations that take time and consume energy, transactions take longer to process, and the network consumes more energy. NFT creators feel this inefficiency as they are called upon to pay higher fees than creators using other blockchains.
Ethereum’s use of proof-of-work is now temporary. Ethereum has announced that it will switch from proof-of-work to proof-of-stake during an event it calls The Merge. Some Ethereum transactions are already being secured by proof-of-stake, but the network will not jettison proof-of-work entirely until The Merge.
Proof-of-stake is a different class of consensus mechanisms. Rather than having to work through arbitrary problems to qualify to validate transactions and contribute the blockchain, nodes in a proof-of-stake network qualify for a chance to do so by putting up some amount of that network’s cryptocurrency. If the node then behaves in ways defined as unacceptable by the network code, the staked currency can be lost.
The more crypto a node stakes for the opportunity to contribute to the blockchain, the higher the probability that it will be selected to add the next block to the chain. In a proof-of-stake network, nodes that stake enough to get this chance are called “validators.” Like miners in proof-of-work networks, proof-of-stake validators have a chance, though not a guarantee, of being rewarded for their contribution with cryptocurrency.
As the computational work element is avoided with proof-of-stake, NFTs are easier to mint, meaning the prices are lower. Solana is an example of a blockchain ledger that uses proof-of-stake. Thus, with Solana NFTs, the minting fees are substantially less than those for Ethereum.
Tech nerd tip:
In addition to proof-of-stake, Solana uses something new called proof-of-history. This causes some to consider the Solana consensus mechanism a hybrid rather than a “pure” proof-of-stake. Though discussion of proof-of-history is beyond the scope of this article, curious readers may review what Solana has to say about this innovation here.
Recap: In the words of Ethereum
In proof-of-work, miners prove they have capital at risk by expending energy. In proof-of-stake, validators explicitly stake capital in the form of ether into a smart contract on Ethereum. This staked ether then acts as collateral that can be destroyed if the validator behaves dishonestly or lazily. The validator is then responsible for checking that new blocks propagated over the network are valid and occasionally creating and propagating new blocks….”
Cost to create, list, and sell an NFT
So, if you have found a blockchain on which you want to host your NFT, you now need to find out how and where to list and sell it. Different marketplaces will have different traffic for NFT art, as well as different fees. Here are some typical fees associated with listing an NFT on an NFT marketplace.
When you mint an NFT, you may have to pay a so-called gas fee. Gas fees are payments an individual makes to complete transactions on the blockchain, including the transaction that adds a new NFT to the ledger. These charges are meant to compensate for the computational power expended. Particularly in the case of Ethereum, at least while it still uses proof-of-work to secure its blockchain, these can get pricey. You can keep track of the Ethereum “gas price” in real-time by checking on Etherscan’s Ethereum Gas Tracker. A marketplace may either charge the gas fee separately or incorporate it into its other fees, meaning, in effect, that you’ll pay your minting expense when you list or sell your NFT.
Actually, gas fees aren’t just for minting
Depending on where you create, list, and sell your NFTs, you may get charged gas fees at any or every stage of the process. For simplicity, we’ve only pointed to the gas fees you may pay when minting your NFTs. Since we are overlooking network fees for minting NFTs on specific platforms, these gas fees are your minting costs as far as our examples are concerned.
It’s entirely possible, however, that the marketplace where you create, list, and sell your NFTs will add gas fees to other steps in the process. For our purposes, it is simpler to consider gas fees charged when listing part of listing fees and gas fees charged when selling part of transaction fees. Just be aware that you may discover a charge for gas fees at other stages in the process.
Some marketplaces will charge listing fees for sellers to list their NFTs. In many cases, you can mint your NFT for free but are charged for listing the NFT in the marketplace. Listing fees can vary, but they’ll most likely be correlate with the gas fee or the minting fee on the blockchain. So, for example, a network with a high gas fee or high minting fee will likely have a high listing fee.
Transaction fees vary between marketplaces, but the standard is about 2.5% per transaction. The most popular platform, OpenSea, charges 2.5% per transaction. However, some marketplaces, such as SuperRare, can charge up to 10%. This isn’t charged when you create an NFT but, rather, when you process your sales transaction.
Summary: cost to create and sell your NFT
How to create and sell an NFT
So you have a piece of digital art that you know is going to take the world by storm. Here is how to create an NFT and sell it on OpenSea, the most popular NFT trading marketplace.
How to create and sell an NFT on OpenSea
Here are the steps you need to take.
- Choose your NFT: Choose what you would like to upload and make into an NFT.
- Choose your blockchain: Choose which blockchain you would like to mint your NFT on. Ethereum is the gold standard but the most expensive.
- Setup or connect your digital wallet: If you are interested in NFTs, you probably have a digital wallet already. However, if you do not, you should get one right away. Once you have it set up, make sure it’s full of the relevant blockchain currencies, such as Ethereum.
- Select your NFT marketplace: OpenSea is the most popular and allows you to also mint NFTs on the platform. However, there are marketplaces like Rarible and Foundation on which you can list your NFT. Some NFT platforms can be better suited for different types of NFT collections.
- Select your sales process: You can now decide how to sell your NFT. Will it be a fixed price? Will it be up for auction? If so, when?
- Complete your NFT sales transaction: Now that you have listed this NFT for sale, get ready to transact with a buyer. Remember that you’ll typically need to pay a transaction fee to complete an NFT sales transaction.
NFT creation and sale example: OpenSea
As an example of what an NFT might cost to create and sell, let’s give a real-life example. Remember, things like gas prices and transaction fees can fluctuate, so these prices are just for illustration. We will use OpenSea on the Ethereum blockchain as an example. In this scenario, we are listing an NFT on OpenSea using the Ethereum blockchain for the fixed sale price of $1,000.
Our cost breakdown
- Minting cost (such as gas fee): In OpenSea, the gas fees are a primary cost. Although they can range from $70 to $500 if the blockchain is overwhelmed, for this example, we’ll say we get charged a $200 gas fee when we create our NFT on the blockchain.
- Listing Fee: In OpenSea, the listing fee is what you pay to grant OpenSea access to your NFTs and the ability to upload. This ranges from $10–$30+, but for this example, we will put it at $10.
- Transaction Fee: The transaction fee will cost you 2.5% of the transaction on OpenSea. 2.5% of the $1,000 sales price is $25.
Recall our formula:
Punch in the numbers for our example:
Summary of expenses and profit
|Expense or income||Dollars|
|Cost to mint the NFT and put it up for sale||$210|
|Cost to sell the NFT (process sales transaction)||$25|
|Total costs on sale||$235|
|Net profit (revenue – total costs)||$765|
Now that you understand some base fees and costs involved in creating and selling an NFT, it’s time to choose a marketplace. Here is a brief rundown of the leading NFT marketplaces.
OpenSea is the gold standard for NFT marketplaces. The market hosts more than 1,000,000 sellers on its platform. Although the fees might be higher than others, the variety of NFTs on the marketplace and the ease of minting and sales transactions make this the industry leader.
Minable is a great choice for beginners. It has a very friendly user interface. Mintable combines the gas, listing, and transaction fees when you’re trying the sell an NFT. You can either pay the gas and listing fees up front, or Mintable will allow you to do this completely free, in exchange for a 5% transaction fee should your NFT sell.
Rarible is another marketplace considered one of the leaders in the NFT game. It will allow you to create and list your NFT for free. However, it charges both you and your buyer 2.5%. That means a 5% combined transaction fee to process your NFT sale.
Can you create an NFT for free?
Yes, in many cases you can create an NFT for free on different platforms. However, platforms will usually make up for this by charging larger transactions fees on sales.
How much does it cost to start an NFT project?
Typically, you need to pay the gas fee and the listing fee to start an NFT project.
How much does minting an NFT cost?
This fluctuates dending on the blockchain and if you use regular minting or lazy minting. You are typically looking at a wide range in costs, say $0–500, depending on how fast you need it done. Patience can mean a considerably lower cost.
How much does it cost to mint an NFT on Ethereum?
Cost changes over time. In July 2022, it costs, on average, $70 to mint an NFT on Ehtereum.
How much does it cost to create an NFT on Solana?
On average, it cost an average of $.01 to mint an NFT on Solana in July 2022. Costs will vary over time, however.
- NFTs are unique digital entities on a blockchain that represent assets and prove assets’ authenticity and ownership.
- Although NFTs can represent any asset and prove ownership and authenticity of that asset, they are currently used mostly for digital artwork.
- An NFT creator needs to pay different costs to create an NFT, such as gas fees when minting (creating) the NFT and listing fees when putting it up for sale, as well as a transaction fee when selling it.
- Popular NFT marketplaces like OpenSea and Rarible are options for you to both create and sell NFTs.
View Article Sources
- Consensus Mechanisms — Ethereum
- Ethereum Gas Tracker — Etherscan
- Helpful background reading from Red Points and Wikipedia, and from cryptocurrency and Web3 learning sites — Various
- How NFT Marketplaces Make Money — NFT Investor Journal
- Kinesis Home Page — Kinesis
- Lode Home Page — Lode
- NFT fees are too high. Here’s how to fix them. — Protocol
- Proof of History: How Solana brings time to crypto — Solana
- Proof-of-Stake — Ethereum
- Proof of Stake: A process used to validate crypto transactions through staking — Business Insider
- Proof-of-work — Ethereum
- Stacks Home Page — Stacks
- The Merge — Ethereum
- Usage-based definitions of blockchain, cryptocurrency, fungible, non-fungible token, and token — Merriam-Webster
- What are Gas Fees and How Can We Fix Them? — NFT Now
- What fees do I pay for my first listing? — OpenSea
- Which Crypto Projects Are Based on Ethereum? — CoinDesk
- How to Invest in the Metaverse — SuperMoney
- How To Invest In Web3 — SuperMoney
- What Is VTHO Crypto? — SuperMoney
- Which Investment Has the Least Liquidity? — SuperMoney