Before you can begin to sell and redeem gift cards it is important you understand how to create them and what options are available. 

You will need to go to Store Operations>Sales>Manage Gift Card Ranges

From this page you can click on the New Gift Card Range or view any existing gift cards ranges previously added.

Most users will opt to create cards for any amount, meaning you'll be able to enter the amount of the card when it's being issued at the register. The Fixed Amount type will create all the cards for one specific amount. This is useful if you have cards printed with certain denomination.

By default all cards created will be available at all locations but you can change that by checking only valid store.  

Here are a couple articles that provide more information:

Selling a Gift Card

Issuing and paying with a Gift Card