Navigating the NFT minefield: It should be made easy for first-time buyers

Collectibles, whether it be shiny Pokemon cards or baseball players, have been an integral part of human culture since the Renaissance. You can auction off memorabilia from movies and clothing worn by celebrities for staggering prices. The 1960s Batman TV series featured a prototype Batmobile that was sold for $4.2million. The concept of collectibles is very simple. An item’s value is determined by its rarity. The more rare it is, the higher its value.

This concept is what has driven the rapid growth of nonfungible tokens. NFTs, which are essentially collectibles that were digitalized, are often bought and sold on Ethereum. NFTs, whether it’s CryptoPunk’s limited and extremely popular avatars, or Jack Dorsey tweeting his first tweet, are hugely valuable. Those who have nabbed a rare NFT will always be able to prove ownership as the data is stored in the blockchain.

Similar: Art reimagined – NFTs are changing collectibles market

However, how easy can it be to get an NFT?

Gas doesn’t come cheap

Mining is the only way to acquire NFTs, just like Bitcoin (BTC), Ether (ETH), and Ether (ETH). The process of mining and paying gas costs — which is the amount someone must pay in order to process crypto transactions — is not new for both sellers and buyers. The mining process can feel like a shark bite to first-time buyers who are just getting started in NFT.

While it is not common practice, some NFT launches use a bonding curve for determining the price of NFTs. This is how liquidity is created on the NFT market. This means that the block space used to determine the price of NFT assets is limited. Network fees are prone to skyrocket due to the ever-increasing use of blockchains such as Ethereum.

Related: Ethereum fees are skyrocketing — But traders still have options

You can choose transactions that have a high fee if you are a miner. This allows miners to make a profit at the expense the buyer. This is a normal situation for crypto-natives. The whole crypto mining fiasco can prove confusing, inexcusable, and completely unfair to someone who is new to the market.

How can this power imbalance be corrected so that new NFT buyers don’t have to pay high gas fees?

Reserve a spot in the queue

It was aware of these issues when it launched the shrug NFT, digitizing the famous emoji that has become a cultural meme. We needed to find a way that would reduce the amount of activity on the chain and thus lower the gas costs, as hundreds of people try to mine NFTs. Buyers can experience a slow process on early NFT platforms. This can result in a cumbersome experience for them and higher gas costs that they have to pay to get their transaction approved.

Similar: NFT Marketplace: How to Buy and Sell Non-fungible Tokens

Implementing a queue system is the solution to these problems. NFT platforms have developed infrastructure that speeds up blockchain transactions. This improves user experience. The major discrepancies that exist in the minting process will be solved by creating a protocol that allows buyers to wait in line while still giving them a window of opportunity to complete their transaction.

Because customers are not competing for the same NFT, and they don’t lose their gas fees, a queue system makes the marketplace more fair. NFTs are gaining popularity and gripping the mainstream’s imagination. It is vital that NFT platforms make their blockchain-hosted marketplaces more fair and inviting for buyers searching for digital collectibles.

Whales dominate the market

Despite all the hype surrounding the NFT market, the average price for an NFT sold on SuperRare was 2.15 Ether (or around $5,800), according to OpenSea rankings. This raises the question of who is actually buying NFTs. Is it possible that first-time buyers are being forced out by a small number of crypto-savvy buyers?

The fact that crypto whales dominate the market does not mean you can implement a queueing system. A crypto whale is an individual or entity that holds large amounts of Bitcoin and other cryptocurrency. This can be a problem for the wider crypto community, since it allows people with enough Bitcoin to manipulate currency values.

Particularly with NFTs the majority of people who purchase these nonfungible tokens is crypto whales. Only 2.3% of the Rarible marketplace sellers account for 50% of NFT sales. OpenSea is a NFT marketplace that has arguably the largest number of sellers. Only 1.9% of its sellers account for half of all NFT sales. What is really happening is that whales buy up projects early and have too much influence over the reseller market, pricing out first-time customers.

People who don’t live or breathe crypto may not be able to participate in the market as much, perhaps because there isn’t enough room.

To reduce the influence of crypto whales, it is important to educate the general public about how to buy NFTs. This will ensure that they don’t become the exclusive domain of the dominant holders. There are still 197 shrug NFTs left. We hope to attract new users to the NFT market by offering the opportunity for them to purchase their first NFT.

NFTs have the potential to bring crypto into mainstream consciousness. They take a concept many people already understand and digitize the driving force behind it. Collectibles are intended to be fun and lucrative for all who participate. The same goes for NFTs.

This article is not intended to provide investment advice. Every trade and investment involves risk. Readers should do their research before making any decision.
These views, thoughts, and opinions are solely the author’s and do not necessarily reflect the views or opinions of Cointelegraph.
StormX’s CEO is Simon Yu. Since 2015, Simon Yu has been involved in the blockchain industry. He is an avid speaker and early developer of the sector. Simon was featured in Forbes, Reader’s Digest and Nasdaq as well as Business Insider.

2021's Most Anticipated Growth & Wealth-Building Opportunity

Join Thousands of Early Adopters Just Like You Who Want to Grow Capital and Truly Understand Cryptocurrency Together

Eileen Wilson

Eileen Wilson –Technology and Energy My Name is Eileen Wilson with more than 5 years of experience in the Stock market industry, I am energetic about Technology news, started my career as an author then, later climbing my way up towards success into senior positions. I can consider myself as the backbone behind the success and growth of topmagazinewire.com with a dream to expand the reach out of the industry on a global scale. I am also a contributor and an editor of the Technology and Energy category. I experienced a critical analysis of companies and extracted the most noteworthy information for our vibrant investor network.

2021's Most Anticipated Growth & Wealth-Building Opportunity

Join Thousands of Early Adopters Just Like You Who Want to Grow Capital and Truly Understand Cryptocurrency Together

Close Bitnami banner
Bitnami