Today the FTX exchange division launched its new NFT marketplace for US clients. Initially, the platform will offer minted NFTs on the Solana network and will soon also support Ethereum – the flagship blockchain for NFTs – as its current goal is to compete with OpenSea.
Unlike OpenSea and decentralized Solana marketplaces like Solanart and DigitalEyes, FTX’s NFT marketplace allows users to buy and sell collectibles in US dollars by credit card, ACH wire transfer, or bank transfer. Users can also buy and sell using cryptocurrencies.
Like the FTX centralized US exchange, the NFT market is regulated in the US, which means that users – from the US or elsewhere – must go through a KYC (identity verification) process. That’s the main difference from the exchanges mentioned above, but the ability to buy NFTs with USD and credit cards could help the mainstream market be adopted faster.
“Right now, NFT is a very small market as it is growing as a DeFi product. We hope that providing a centralized marketplace for NFTs that allows people to fund their accounts by credit card or wire transfer will bring more liquidity to the market in general and lead to better devaluation and fairer markets, “said FTX US President Brett Harrison.
The NFT is like a certificate of ownership for a rare digital item. The NFT market is booming in 2021 with a trading volume of $ 2.5 billion in the first half of the year, according to DappRadar – a huge jump of $ 200 million for all of 2020. After a summer lull, the market is trading on new levels Highs rose in the third quarter of 2021 alone, the volume reached 10.67 billion US dollars.
“The crypto community is currently very interested in NFT and so are we. We think it suits us as we are very dependent on blockchain technology and all the requirements to support exchanges with hundreds of thousands, if not thousands of dollars, millions of users, as well as concurrent auctions. ”
How does FTX-NFT work?
Initially, the FTX NFT will support the Solana blockchain. The platform has seen strong growth in NFT trading volume thanks to top collections such as the Degenerate Ape Academy and Solana Monkey Business. Both have NFT sales in excess of $ 1 million per collection, along with a combined weekly value of millions of dollars in activities.
Users can transfer their existing Metaplex Compatible NFT Solana to the FTX-NFT platform for sale, and owners can migrate it as well. In addition, users are allowed to mint and create their own NFTs on the platform; these NFTs must be approved before listing.
Unlike Solanart, the FTX NFT will not take a rigorous approach to pre-listing collections. However, there are regulations that come with a centralized, regulated exchange. Harrison says, for example, it won’t list projects where the NFT acts as a collateral rather than pure works of art or collectibles – such as:
🙉 SMB # 1355 SOLD for 13027.00 SOLD
– SMB sales bot (@SMB_SalesBot) October 1, 2021
Solana Monkey Business, one of the projects FTX has launched to date, is offering royalties from the sale of works to owners of Generation 1 NFT collections. The larger collection of 5,000 Gen 2 is not royalty-free. The FTX NFT enables Solana Monkey Business Gen 2 NFTs to be sold, but does not list older sets.
FTX US works with project founders to verify upcoming collections on the platform and prevent fraud. Harrison says the information in Solana’s Metaplex contracts – or with Ethereum’s ERC-721 standard – will allow them to review details about NFTs that are coming out on the market. FTX can also validate NFT minting addresses on Solana, Harrison said.
The FTX NFT charges a fee of 2% when selling works, lower than the flat rate of OpenSea of 2.5% and that of Solanart of 3%. Harrison said the exchange will “respect the license fee decisions made in the contract” for NFTs brought to market. Unlike other NFT marketplaces on Solana, FTX NFT enables users to sell through auctions in addition to a fixed price list.
The NFT market is thriving on Solana, but Ethereum remains by far the leading platform in the field. Large collectibles like CryptoPunks, Art Blocks, and Bored Ape Yacht Club all work on Ethereum, while leading crypto game Axie Infinity has NFT on the Ethereum-based Ronin sidechain. Ethereum had the largest share of the massive trading volume in the NFT market in the third quarter.
In addition, FTX NFT will soon also support Ethereum. Harrison announced that it is “probably in a couple of weeks” as the team is rapidly expanding the platform’s focus.
Check out the competition
Solana’s rapid growth over the past few weeks has generated millions of dollars in fees for NFT marketplaces like Solanart and DigitalEyes – platforms with many small teams and rapidly increasing activity. In the last week alone, NFT collections on Solana generated a total transaction volume of more than $ 139 million, according to Solanalysis.
With a large user base and reach, as well as lower fees, auction functions, and additional US dollar payments, FTX US is focused on the emerging NFT space on Solana with the aim of capturing the majority of the market share.
“We believe these aspects of the market will make it more attractive than its competitors in many ways. We hope to be able to capture a decent market share. “
Ultimately, OpenSea is a much bigger goal. The leading NFT market generated nearly $ 6.9 billion in trading volume in the third quarter alone Dune analysiswhich ranks between sales of Ethereum and Polygon. OpenSea does not currently support fiat payments, but is expected to follow suit notification on 08/10
Meanwhile emerging competing platforms like Infinity (accidentally self- Call even as “FTX of the NFT”) and Artion should take over part of its business. Harrison believes FTX US is well positioned to overtake OpenSea.
“OpenSea has the advantage of a three-year start-up period. They certainly have many features, and their market is excellent in many ways. But we are a very fast growing and trendy company. We believe we can access many of the technological features of OpenSea, hopefully in a short period of time. “
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