NFT Coin 3 — Questions and Answers
Question 1: What is a 'gas fee' and how does it relate to spending coins on NFT art?
- A fee paid to the artist as a royalty
- A transaction cost paid in the network's native coin to process blockchain operations (Correct answer)
- A penalty for minting too many NFTs
- An insurance charge for storing NFTs
Correct answer: A transaction cost paid in the network's native coin to process blockchain operations
Gas fees are paid in the network's native coin (e.g., ETH) to compensate validators for processing transactions on the blockchain.
Question 2: An NFT art project advertises a 'free mint.' What cost might still apply when collecting?
- Artist royalty only
- Gas fees paid in the native coin (Correct answer)
- Platform subscription fees in fiat
- Token burn fees in a stablecoin
Correct answer: Gas fees paid in the native coin
Even 'free mint' NFTs require paying gas fees in the native coin (e.g., ETH) to record the transaction on the blockchain.
Question 3: Which Solana-based coin is used to buy NFT art on Magic Eden?
- ETH
- SOL (Correct answer)
- MATIC
- AVAX
Correct answer: SOL
SOL, the native coin of the Solana blockchain, is used for NFT transactions on Magic Eden.
Question 4: What is a 'floor price' in an NFT art collection, measured in coins?
- The maximum amount ever paid for an NFT in the collection
- The lowest listed price for any NFT in a collection (Correct answer)
- The average price across all recent sales
- The artist's reserve price set at auction
Correct answer: The lowest listed price for any NFT in a collection
The floor price is the lowest asking price for any available NFT in a collection at a given moment.
Question 5: How do creator royalties typically work when an NFT artwork is resold for coins?
- The original buyer keeps 100% of the resale price
- A percentage of the resale price in coins is automatically sent to the creator (Correct answer)
- Royalties are paid by the platform in fiat currency
- Royalties only apply to the first resale
Correct answer: A percentage of the resale price in coins is automatically sent to the creator
Smart contracts encode royalty percentages so the creator automatically receives a cut of each secondary resale in the native coin.
Question 6: What does 'coin-gating' mean in an NFT art community context?
- Locking NFT artwork behind a physical coin display
- Requiring holders to own a specific token or coin to access exclusive content or events (Correct answer)
- Using coins to vote on community governance proposals
- Burning coins to upgrade an NFT's rarity tier
Correct answer: Requiring holders to own a specific token or coin to access exclusive content or events
Coin-gating (or token-gating) restricts access to content, events, or communities to verified holders of a specific coin or NFT.
Question 7: A numismatic artist releases a digital coin series as NFTs. What makes each piece verifiably unique on-chain?
- A unique serial number printed on the physical companion coin
- Each NFT has a unique token ID recorded immutably on the blockchain (Correct answer)
- The artist signs the JPEG file with a watermark
- The marketplace assigns a unique SKU number
Correct answer: Each NFT has a unique token ID recorded immutably on the blockchain
Each NFT carries a unique token ID stored on the blockchain, making it cryptographically distinct from every other token.
NFT Coin 3
What is a 'gas fee' and how does it relate to spending coins on NFT art?