NFTs, as blockchain-based immutable ownership records of digital assets, are quite popular, particularly in the space of art and collectables. However, the potential of NFTs extends beyond digital artworks. They are used for buying digital lands in virtual worlds, publishing and licensing next-generation music ownership and accessing special sales or limited-edition products such as tickets.
Talking about the popularity of NFTs, it is interesting to know that NFT trading volume reached $10.7 billion in the third quarter of 2021, as reported by DappRadar. That’s a whopping 704% increase from the previous quarter. This trend of spending thousands of dollars on NFTs demonstrates that people believe in the future of NFT technology and, in some ways, they tie NFTs to social status.
None the less, as the community of NFT consumers is growing, NFT Marketplaces see increased traffic. Last year, the top NFT marketplaces were OpenSea, Magic Eden, Axie Infinity, and CryptoPunks. These marketplaces are in high demand in areas such as play-to-earn gaming, digital art collectables, fundraising projects, digital subscription models, etc.
See more: How to start a nft platform
No wonder many entrepreneurs consider NFT marketplace development as a great opportunity to capitalize on this new wave of technology that is quickly becoming a major industry. If you are also interested in developing and launching your NFT marketplace, here is a comprehensive guide to help you get started.
- What is an NFT Marketplace?
- How does an NFT Marketplace work?
- How to start NFT Marketplace Development?
- How to develop NFT Marketplace using IPFS and Flow?
What is an NFT Marketplace?
NFT marketplace, as the name implies, is a decentralized platform where users can create, buy, sell, and store non-fungible tokens. An NFT marketplace facilities NFT minting and trading at a global scale, while blockchain as its underlying technology ensures transparency and immutable recording of the digital asset tokenization and trading process. The marketplace also takes care of NFT storage.
NFT marketplaces are gaining traction in industries such as gaming, art, social networking, and music, nearly capturing every market that deals with digital assets. With the influx of Metaverse projects, NFT marketplaces have grown into prominence and relevance even further.
With time, the features of NFT marketplaces are upgrading, and limitations like lack of NFT interoperability are getting addressed. Cross-chain bridging, niche-specific NFTs, NFT swapping, and compatibility with multiple metaverse projects are some of the advanced features of contemporary NFT marketplaces.
One important factor to consider before developing your NFT Marketplace project is the niche. However, above and beyond niche, there are numerous layers to consider like the blockchain protocol, the NFT storge, architecture designing, and others. Here, this insight covers all about NFT marketplace development.
How does an NFT Marketplace work?
Before diving deep into how an NFT marketplace is created, it is essential to understand how the NFT marketplace works from the client side. Usually, all NFT platforms share a similar workflow. Firstly, a user has to sign up on the platform and install a digital wallet to store NFTs.
Users can then create their assets by uploading items to exhibit their work. The user can also select which payment tokens they would like to accept for their art and set a fee if the platform suggests it. The next step in the workflow is to list items for sale. The user can choose a bid for a fixed price or an auction. A transaction is created when listing an item for sale to launch a personal trading smart contract for the user wallet.
The platform may need a collection moderation and NFTs will appear on the list after approval.
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