Want to jump straight to the answer? You can buy Flow on Binance.
Non fungible tokens (NFTs) have been all the rage in the cryptocurrency community. They are tokenized digital assets archived on a blockchain and are impossible to counterfeit. These tokens can be unique from each other, unlike conventional cryptos such as Bitcoin, where there isn’t a meaningful difference among Bitcoins. The selling point of NFTs is scarcity and how easy it is to prove uniqueness. Bitcoin’s price is also driven by scarcity even though it has a maximum supply of 21 million coins. However, it is dramatically more popular than any specific NFT.
NFTs were so popular in 2017 that they completely ground Ethereum to a halt because of massive network congestion. The main impetus of this was CryptoKitties, a game on Ethereum where users can buy, sell, breed and collect NFT cats. CryptoKitties was made by Dapper Labs, one of the most successful companies in the NFT space today. Dapper Labs didn’t sit around and wait for Ethereum to scale to solve the problem CryptoKitties ignited. Instead, it started building its own blockchain designed for the technology it wanted to create and attract developers to help form an ecosystem around it. A few years after the CryptoKitty network pile-up, Dapper Labs finally launched its new blockchain, Flow.
What is Flow?
Flow is the native cryptocurrency of the blockchain sharing its name and it has more functionality than many other altcoins. It will eventually act as a governance token for a decentralized autonomous organization (DAO) to let users decide the future of the network.
Users secure the Flow network and process transactions by staking the crypto with validator nodes on the network. They earn interest and transaction fees based on their stake to incentivize network participation.
This system is similar to the popular consensus mechanism, proof of stake. Ethereum plans on moving to proof of stake with sharding where the blockchain is horizontally split into shards to increase transaction throughput.
The Flow blockchain is also split into multiple pieces and seems similar to the upcoming Ethereum update on the surface, but it has a few key differences. Instead of sharding, Flow separates validator nodes vertically into 4 different roles.
In a sharded blockchain, nodes will not participate in validating every transaction. Without further protections, this means attackers could hurt the network with control over a smaller percentage of nodes on the network. Ethereum plans to get around this by randomly assigning transactions to nodes to make such an attack too unpredictable to be possible. Flow wants to completely avoid this problem by ensuring all nodes help validate every transaction, even if each one only completes a quarter of the whole process.
Flow has a wide range of uses beyond basic utility because decentralized application (DApp) developers can easily integrate the coin into their platforms. Games and any other kind of platform on the blockchain can use Flow to purchase in-game items, make peer-to-peer transfers, earn rewards and more. One of the most popular platforms on Flow right now is NBA Top Shot. You can spend Flow to buy packs of NFTs representing fully licensed clips of NBA games. CryptoKitties hasn’t moved to Flow yet, but Dapper Labs says they are actively working on the transition.
Brief History of Flow
Dapper Labs, the team behind Flow, originates from Axiom Labs, a startup, venture capital firm and incubator rolled into one. CryptoKitties was developed in 2017 before Dapper Labs spun off into its own company in early 2018. The next year, Dapper Labs finally announced its new project, the Flow blockchain. In the same release, it touted an $11 million investment from the Silicon Valley venture capital firm, Andreessen Horowitz. Since then, Dapper Labs has amassed 100s of millions of dollars in total to fund the NBA Top Shot platform and its other products. Even the legendary basketball player Michael Jordan invested, dead set on helping to expand the project.
Flow has seen many dramatic price shifts since its release. In January of 2022 it was trading a little under $9, and in June of 2022, the token had fallen all the way down to around $1—a stark contrast from its all-time high of $44.
How to Buy Flow
Does it seem too complicated to invest in Flow? All you need to do is follow these 3 quick steps.
- Open an online account.
Flow is available for trading on a few different trading platforms. Before you can start trading Flow you will need to sign up for an account on one of these platforms. Some of the best exchanges offering the token are Binance and Crypto.com. If you live in the United States where Binance is unavailable, your best choice may be Crypto.com. When you sign up for an account you will need to verify your identity before you purchase any cryptocurrencies. This is usually a painless process and entails providing your Social Security number, address and a picture of your driver’s license or another valid ID.
- Buy a wallet (optional).
Security is one of the most important factors cryptocurrency investors take into account when investing in the market. Unfortunately, it’s easier to steal cryptocurrencies through hacks than many other assets, so investors must be wary. Exchanges are likely the most sensitive to large-scale hacks and are generally considered to be one of the worst options for storing cryptos. However, large exchanges like Binance, Crypto.com and Coinbase employ extensive security to keep user cryptos safe and secure.
Even with these measures, it’s often smart to move your portfolio into a personal wallet, either software or hardware. Each type comes with its advantages and disadvantages and many investors have each to get the best of both worlds. - Make your purchase.
After you have your wallet ready (if you want one) and your exchange account set up, it’s time to deposit the funds you need. The easiest way to fund your account is often to deposit fiat currencies like USD via ACH deposit or a wire transfer. You can also send another cryptocurrency to the exchange if you already have some to trade. When the deposit goes through you can start trading cryptos. Now just find the trading pair with Flow and the asset you want to trade it for, set your price and make your purchase.
Best Wallets for FLOW
Best Hardware Wallet: Ledger
Ledger is the most popular hardware wallet in the world and the brand’s dominance doesn’t seem to be fading. It’s so popular because it is one of the most secure ways to store your cryptocurrencies. The company produces 2 main wallets: the Ledger Nano S and Ledger Nano X. Ledger supports Bitcoin, Ethereum, Ripple, all ERC-20 tokens, Flow and many more cryptos. Before you can manage your Flow with your Ledger you will need to download and install the Flow app on your device. Follow the quick guide on Ledger’s website to get the application.
Both models use the same certified secure chip that generates your wallet’s private key, encrypts it and stores it safely. The private key is the only way to access your crypto portfolio and it never leaves the device so that not even Ledger can see it. The Nano S is the simpler device, perfect for beginners looking for immense security for their funds. The Nano X adds a larger screen and Bluetooth functionality to smooth out the mild clunkiness most hardware wallets often suffer from. The Nano X will likely be more convenient to use, but both models will keep your cryptos safe.
Best Software Wallet: Dapper
If you’re hoping to use a regular Ethereum wallet like Metamask or Coinbase Wallet to store your Flow, you will be disappointed. However, Dapper Labs makes its own wallet that works with both the Flow blockchain and the Ethereum network: Dapper. You can connect a credit or debit card to fund your wallet and use wire transfers to withdraw when you need to. It connects easily to DApps on the Flow blockchain like NBA Top Shot to make purchases and store your collectibles and tokens. Until other top wallets expand to the Flow blockchain, you will likely be forced to use Dapper Labs’ wallet.
Bonus:
Flow’s success will likely depend on a few major factors. It will need to attract more large NFT and gaming platforms to drive the price of the crypto up. Also, it will probably follow the whole cryptocurrency market to some degree.
Trade, Sell or Convert Flow
Flow is a volatile asset and can be extremely sensitive to the ups and downs of the larger cryptocurrency market. This is certainly not unusual for relatively small market capitalization altcoins, but you should always know how to sell your tokens in case of drastic price swings. Luckily, it's incredibly simple to close your position. The first thing you have to do is send the tokens back to the exchange you purchased them on or another that supports Flow trading. After the tokens are in the exchange, find the trading pair you want to use and complete the trade.
Current Crypto Prices
The cryptocurrency market is continuing to rally, led by Bitcoin, Ethereum and non fungible tokens. Many investors believed that the devastating market crash in June of 2022 was the end of the astonishing crypto bull market.
One of the most astounding trends in the market now that may be pushing the market upward is the NFT. For example, CryptoPunks, among the 1st NFT projects on Ethereum, are currently being bought and sold for incredible prices. The cheapest go for 10s of Ether and the most expensive have been purchased for 1,000s of Ether.
Is Flow a Good Investment?
Flow might be a good investment, but it’s certainly not without risk. Anyone who invested in it in January or June would be deep in the green. However, if you invested anywhere near the coin’s all-time high, you might be down 50%. If you strongly believe in NFTs, the blockchain and DApps on it, purchasing Flow may be your best way to speculate on the success of the entire ecosystem.
Frequently Asked Questions
Can you make money with NFTs?
Yes, you can make money with NFTs if you invest in the appropriate assets and monitor your portfolio with care.
Are NFTs dead?
The NFT sector isn’t dead, but there may need to be some expansion in use cases if certain projects want to survive.
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About Henry Stater
Henry is an expert in all things crypto. He stays up to date with all the latest coins, platforms and technologies in the field. He has particular expertise in the burgeoning decentralized finance ecosystem and loves trying out all the new platforms. He also always follows major events in other financial markets and geopolitics as a whole, especially when an event’s effects ripple through the crypto market.