What is NFT Marketplace?
NFT marketplace is a marketplace used for buying and selling transactions NFT. Every asset class needs a market to trade and so does the NFT. Similar to evaluating the DeFi of an ecosystem by looking at the parameters of the DEX (TVL, Volume, …), looking at the basic parameters of NFT marketplaces helps us to assess the overall situation of the market. NFT on an Ecosystem:
- Do they attract cash flow?
- What types of NFTs are preferred?
- Which branch of NFT is most focused on in the ecosystem?
- …
Status of NFT marketplaces
NFT has been proving its influence, this is considered the gateway to bring new users to Crypto. To understand more about the current situation of NFT as well as ways to make money from NFT, you can refer to: NFT Investment Guide 2022
As one of the core pieces for that development, NFT marketplaces have also had impressive achievements such as:
- A large number of NFTs are listed on the exchange. In Open Sea alone, there are currently more than 33 million NFTs listed on the exchange, an extremely large number.
- Indicators such as trading volume, number of NFTs sold, revenue, users all increased sharply.
- CEX centralized exchanges are also gradually joining the game, leading names such as Binance, FTX, Coinbase, Crypto.com have all launched NFT exchanges.
- The current NFT is not only focused on the Ethereum playing field. The birth of many different ecosystems has created many different environments for NFT development and with it, the birth of many NFT marketplaces per ecosystem. In addition, NFT marketplaces are also gradually turning to the multichain trend to expand their market share.
The current picture of NFT is very different from that of 2017, 2018 and below, I will dig deeper with you guys about this gradually forming trend.
Classification of NFT marketplaces
Quite similar to DeFi in the development stage when more and more DEXs are launched, the current number of NFT marketplaces is also increasing. From a personal point of view, I divide NFT marketplaces into 3 main types, including:
- Exclusive NFT marketplace.
- General NFT marketplace.
- Specific NFT marketplace.
Exclusive NFT marketplace
Exclusive NFT marketplace is a marketplace for buying and selling unique NFTs. These NFTs are often works of art, and the artist publishes almost a single copy or in small quantities of each work. This makes the value of NFTs in the Exclusive NFT marketplace very high.
However, the downside of this market is its low liquidity due to its small quantity and high price, making it suitable for collectors who want to own special and unique pieces.
Some outstanding Exclusive NFT marketplaces: SuperRare, Foundation, knownorigin.
General NFT marketplace
The General NFT marketplace is the marketplace for most NFTs. NFTs of all shapes, sizes, prices and features can be created and sold here.
This is the most popular type of marketplace and has the most quantity because they meet the needs of the vast majority of users.
Current prominent General NFT marketplaces include OpenSea, Magic Eden, ImmutableX marketplace, or NFT marketplaces of CEXs such as Binance NFT, FTX NFT,…
Specific NFT marketplace
Specific NFT marketplace is a marketplace for specific NFTs of a certain segment. Maybe it’s a market dedicated to buying and selling NFTs in games, or it could be dedicated to songs, videos, etc.
Having a dedicated market for a certain segment makes it easier and more convenient to trade assets. Users can also monitor movements and react more quickly than in general markets.
On the contrary, for the Specific NFT marketplace to work smoothly, the project needs to meet basic conditions such as having a large enough user base to creating factors to encourage transactions in its marketplace. .
Although the form of buying and selling between marketplaces in each type may be different such as: auction, order placement, P2P, … but in general, we can divide NFT marketplaces into three types as above. Each type has an approach and is suitable for different audiences.
Forecast for NFT Marketplace
The NFT market is really growing, and I think for those of you who want to make money from Crypto, you should not just look at NFT as ordinary works anymore, but should gradually dig deeper into the pieces of this field.
Below are a few of my projections for NFT marketplaces.
Things that can be tokenized will be tokenized, so does the NFT marketplace
Tokens are an integral part of Crypto and projects will tend to issue tokens including NFT related projects. Market leading collectibles such as Bored Ape Yacht Club already out token $APE and it is highly likely that NFT marketplaces will also launch tokens in the future.
This is like DeFi in the development stage when the number of DEXs is increasing and all are launching tokens. The reason why NFT marketplaces haven’t issued tokens yet, I think is because the leading project in the market is OpenSea token has not been released. Already a rival project launched the token is LooksRare (LOOK), despite certain achievements, LooksRare has not been able to spark the wave of NFT marketplace tokens. When OpenSea releases its token, it is very likely that the project will set the standard for the industry and other marketplaces will start to issue tokens.
Branching between systems
Each ecosystem has a different technology and community strengths. NFT marketplaces will also evolve to match the needs of their user files.
“The most valuable collectibles will continue to reside on Ethereum.
NFT gaming will flourish on Solana and Binance Smart Chain.
NFTs related to the entertainment industry will grow on the Binance and Terra platforms.”
– Quote from Cam who is investing in NFT – NFT Pandora 2022
From the above, I project that Exclusive and General NFT Marketplace will develop on Ethereum, General and Specific NFT Marketplace will develop on Solana and similar for other systems.
NFT and beyond
As in DeFi, DEX develops then Lending then Dervative, when the NFT market attracts liquidity and the NFT marketplace grows large enough new projects like Lending NFT and never-before-seen applications will be applied to the NFT.
The NFT marketplace will now act as a marketplace to help transfer value between projects and ecosystems.
Investment opportunity with NFT Marketplace
From the above projections, a few ways that I think you can do to prepare for this gradually forming trend include:
Retroactive
Currently, there are a large number of NFT marketplaces that have not yet issued tokens, this is a great opportunity for you to participate in product experiences and get retroactive from future projects.
Note: In my experience, most NFTs have a relatively high transaction fee. You should choose the top projects and focus on doing those projects instead of scattered projects.
How to choose a good project I will present below. Choosing a good project not only helps you increase your chances of receiving a great reward, but also serves investment purposes later.
Good project selection
To choose a good NFT marketplace project, I have the following steps:
- As described above, each system will develop different types of marketplace and you need Determine what type of genre you should follow.
- Find the projects with the best performance. Usually, in each ecosystem, there will be a marketplace with a large market share. You should look for opportunities in such projects.
When choosing a good exchange, you can do retroactive, NFT speculation and buy low and sell high and further invest when the project releases tokens in the future.
Epilogue
The above is a summary of the knowledge that I have learned in the past about the NFT marketplace, hoping to help you have a new perspective on this segment.
“NFT has huge potential and I believe this market will continue to grow strongly in the future.”
Disclaimer: This article is for informational purposes only and should not be considered investment advice. Crypto investment is a very risky type of investment and you should only participate with the amount of capital you can lose.
Source: What is NFT Marketplace? Where the value of NFT . flows
– TechtipsnReview
