NFTs are non-fungible tokens. They are unique items that you can’t replace with something else. For example, a one-of-a-kind trading card is an NFT. If you trade your card for some other card, you have something different.
Non-fungible tokens (NFTs) give you ownership of artwork, music, videos and other online collectibles. They exist on blockchains, the innovative technology that underlies cryptocurrencies like Bitcoin.
The popularity of NFTs has skyrocketed in recent years, with the market reaching a $40 billion valuation in 2021 and holding strong in 2022.
What Is a NFT Marketplace?
An NFT marketplace is a digital platform for buying and selling NFTs. These platforms allow people to store and display their NFTs plus sell them to others for cryptocurrency or money. Some NFT marketplaces also allow users to mint their NFTs on the platform itself.
In exchange for a fee, the NFT marketplace will typically handle the transfer of an NFT from one party to the other.
If you’re looking to get involved in the NFT market, choose a reputable and cost-effective platform, and the best NFT marketplace for your investment needs.
In this guide, we’ll discuss the best NFT marketplaces in detail by reviewing the Top Five NFT platforms by trading volume.
OpenSea is ancient by NFT standards, having launched in 2017, and it’s also among the largest NFT marketplaces active today. It hosts many popular NFTs, including art, music, photography, trading cards and virtual worlds.
The core cryptocurrencies used on OpenSea are Ethereum, Solana, and USDC, and payment options feature other cryptos.
OpenSea is very user-friendly for beginners. You can set up an account for free within minutes and start browsing NFTs immediately, and you can even create NFTs on their platform.
For costs, OpenSea charges a fee equal to 2.5% of every transaction. You must also pay the ‘gas fee’ for completing NFT transactions with Ethereum. Gas fees are the transaction fees paid to miners.
If you’re looking to avoid the gas fee, you can buy and sell NFTs with Polygon. But you’ll need to ensure that the NFT item of interest displays the Polygon logo.
In short, OpenSea is a solid choice for beginners looking to get started with a straightforward marketplace and who want as many options as possible for NFTs.
X2Y2 is an emerging NFT marketplace that launched in February 2022. X2Y2 rivals OpenSea (the largest NFT marketplace), featuring bulk-listing, rarity tracking, and real-time notifications. The X2Y2 token is the governance token of the X2Y2 marketplace, currently trading at $0.32 with a market cap of $42 million and a total supply of 1 billion tokens.
The team behind X2Y2 is comprised of NFT and blockchain development veterans that noticed the downsides of centralization in the NFT ecosystem. Namely, 90% of all NFT transactions are on OpenSea and every time there is a downside or censorship, the whole NFT ecosystem is affected. Their message was “NFTs are not only on OpenSea.”
The centralization of the NFT ecosystem has led to the creation of a few competing NFT platforms, one of which is X2Y2. The X2Y2 name is derived from a mathematical formula that creates a perfect circle. The X2Y2 logo represents a blue circle based on that formula.
X2Y2’s NFT marketplace brought new features to the forefront of NFT trading. Those features include:
Profit-sharing: X2Y2 is the first NFT profit-sharing platform. Users who stake their X2Y2 tokens on the platform will receive a % of the fees for all NFT trades proportional to their share. Other platforms such as OpenSea don’t offer profit-sharing.
Bulk listings: Users can list all their NFTs simultaneously or list selected NFTs in one transaction. This saves on gas fees from having to pay for individual NFT listing.
Bulk purchasing: Traders can purchase multiple NFTs with one transaction, paying a singular gas fee. This also saves on gas fees for frequent traders.
Push notifications: X2Y2’s system automatically emails users the second there’s a bid or a purchase of one of their NFTs. It also notifies traders if their bid is accepted.
Rarity statistics: X2Y2 features a brand new rarity tracker that can track the rarity of items and also show the last price on OpenSea. Detailed analytics are included for each NFT and its history.
Secret items: X2Y2 will be the first NFT platform to feature secret NFTs and privacy will be one of their main angles in the future.
X2Y2’s NFT marketplace is only compatible with Ethereum (ETH) mainnet NFTs.
Even though the website design resembles OpenSea and other NFT platforms, the features and the back-end were developed from scratch for this platform.
Rarible is an NFT marketplace that connects content creators and buyers of non-fungible tokens (NFTs) without requiring users to have any prior coding skills. The experts developed the marketplace on the Ethereum blockchain to ensure that transactions are safe and secure.
The platform’s primary function is to serve as an NFT marketplace built on the Ethereum blockchain. Creators must first convert their work to an NFT using Rarible to sell their work. When a content creator uploads artwork, such as an image or audio file, the platform generates an NFT token to represent it.
Rarible currently supports a variety of blockchain technologies, including the Binance Smart Chain. When a buyer acquires content, the platform sends NFT to the buyer’s digital wallet and records the transaction on the Ethereum blockchain. The RARI native token governs the platform, which enables Rarible users to have a say in how the platform develops.
Features of Rarible
Beginner-friendly and the entire process is straightforward.
RARI holders run the platform in an autonomous environment. They are in charge of voting on suggestions for governance. Its long-term goal is to become a completely decentralized autonomous organization (DAO).
The platform addresses the limitations of the intellectual property market, such as paperwork constraints and difficult licensing procedures. The platform provides a (simple) alternative that everyone can use.
A zero-barrier environment allows users to engage directly without limitations or restrictions. No one needs to be concerned about their safety because the platform does everything in a very safe and secure setting.
Rarible has grown in popularity as a platform for trading NFTs.
However, it does have some disadvantages. To better understand the benefits and drawbacks of using this marketplace, we’ll examine its strengths and places for improvement to offer users a greater sense of value when buying or selling their NFTs.
Advantages of Rarible
Rarible has a lazy minting feature that lets users create NFTs without paying any upfront gas fees.
This marketplace is simple to use and requires no coding knowledge.
The platform rewards RARI tokens to NFT sellers and buyers on the network.
RARI tokens holders can vote on proposals that affect the platform.
It’s open-source and free to use, but it’s also entirely safe from outside attacks.
Users can pay using their credit card, debit card, or Google Pay on Rarible.
Disadvantages of Rarible
RARI does not support APIs or IPFS storage, nor does it have an official roadmap or whitepaper.
This service charges a 2.5% fee to both the seller and the buyer.
Nifty Gateway is a popular NFT marketplace that has sold artworks from digital artists and celebrities like Beeple, Pak, Daniel Arsham, and Grimes. The platform is managed by Gemini, a regulated and secure crypto exchange, and is considered a high-end marketplace due to its collaboration with popular creators and brands.
Nifty Gateway is owned by the parent company Gemini LLC, a cryptocurrency exchange website with twin owners and founders, the Winklevoss brothers. Gemini is a New York trust company with no foreseeable IPO and therefore no stocks or shares price. Despite this, a recent valuation put the company at between $774 million to $1.2 billion as nifty sales volumes have soared in recent months.
One of the things that make Nifty Gateway unique is it allows creators to receive a percentage of secondary market sales. So, when someone purchases your NFT, you will receive a cut from the sales. Moreover, Nifty Gateway has “open editions,” which allow creators to mint unlimited editions of their works for a limited time.
Additionally, Nifty Gateway makes selling NFTs easier for creators by handling all the technical aspects related to the creation and sale of NFTs by providing you with technical assistance. If you also happen to be a collector, Nifty Gateway lets you purchase other NFTs using fiat currencies.
Unlike most NFT marketplaces, Nifty Gateway hosts the NFTs it acquires. This means that the NFTs you sell or purchase aren’t stored in a wallet. Instead, they’re held by Nifty Gateway and Gemini and are stored in your Nifty account.
LooksRare is a decentralized, community-first NFT marketplace that actively rewards traders, token stakers, creators and collectors for participating on the platform.
Two unidentified founders going by the pseudonyms “Zodd” and “Guts” launched the platform in January 2022, with a team of 11 members tending to the project’s development. The aim of LooksRare was to dethrone OpenSea from its number one spot in the NFT market.
LooksRare is built on the Ethereum blockchain and allows participants to trade Ethereum NFTs available on OpenSea. The platform charges a 2% sales fee (in WETH) on all NFT sales, excluding private sales.
All WETH fees accumulated from sales are combined at the end of every 6,500 ETH block period (approximately 24 hours) and distributed to LOOKS token stakers per block during the next 6,500 block span.
Users can claim their WETH rewards as often as they want, but have to pay gas fees on each withdrawal. If they forget to claim their WETH, or prefer to wait until gas fees are lower, their WETH will continue to accumulate as long as their LOOKS tokens remain staked.
As a community-first project, 100% of the revenue generated is distributed to stakers of LOOKS tokens. The team does not gain revenue directly from the project, and is rewarded only if the project does well.
Key Features of LooksRare
Community-First NFT Marketplace
LooksRare puts its users first by distributing rewards, a feature which OpenSea doesn’t offer.
Since LooksRare’s smart contracts are built on a modular system, new features can be implemented efficiently over time. The platform can do so without compromising security, thanks to standardized signatures which outline the execution plan in a transparent manner.
Some new features that LooksRare plans to implement in the near future include:
Collection Offer: Users can make an offer that includes all NFTs in a selected collection.
Trait Offer: Users can buy any NFT with a specific trait in a collection.
Multi-Cancellation: Users can cancel multiple open orders in a single transaction. When multiple open orders are canceled separately, gas fees tend to be quite high, which is where LooksRare’s multi-cancellation feature helps.
The LooksRare team has designed the technical framework — front end, search function, contracts, database and API — from scratch, in order to optimize security, speed and scalability. LooksRare has also maintained compatibility for future deployment with ETH scaling solutions.