NFT Marketplace Development: Building the Future of Digital Assets

Introduction

Though NFTs were introduced in 2014, they only gained traction from 2017 onwards. In 2017, ERC 721 was introduced as a token standard on the Ethereum blockchain. This standard encouraged the creation of distinct, immutable digital assets which could be traded. A crypto platform by the name Cryptokitties, which allowed users to collect, breed, and sell NFT kittens, further broke the records of possible transactions on the Ethereum network.

Since then, Digital Art and its ownership have caught on not just as creatives but also as financial assets. While NFT platforms allow artists to create and monetize anything, it does so in the most secure way possible. Before we delve into the nitty gritty of NFT, let us know more about non-fungible tokens and their marketplaces.

What is NFT marketplace development?

Fundamentally, Non-fungible tokens are cryptographic digital assets saved on a blockchain network representing real-world assets such as artwork or real estate. Once these real-world assets are ‘tokenized,’ they can be traded, purchased, or sold on any NFT marketplace.

An NFT marketplace is a virtual platform that allows the sale of non-fungible tokens of various owners and creators. NFT marketplace development on the other hand refers to the development of such platforms for daily use. One successful solution for NFT marketplace development is OpenSea, which also happens to be the world’s first NFT platform. OpenSea displays individual pictures and their collections and lets users create and launch their own NFT collection or a single NFT. It charges a small fee on all NFT transactions. Many such platforms have led to an increase in general curiosity around NFT Marketplace app development as more and more industries are looking to invest in the same. The need for a reliable NFT marketplace development company has also risen along with the rise of NFT development solutions. Here are a few statistics that are evidence of this marked trend.

Types of NFT Marketplace Development- Open Vs closed

There are two common categories of NFT marketplace- Open and Closed. As the name suggests Open NFT marketplace refers to NFT marketplace which is more inclusive and offers vast NFT collections. IT allows for open and liberal trading environments Examples include Raribles, OpenSea, etc. Closed marketplace on the other hand has several limitations to trades and such trades are regulated extensively. Such a marketplace also serves a niche crowd with niche interests. SuperRare and Nitty Gateway are examples of closed NFT marketplaces. The below table further helps distinguish between the two:

NFT Statistics

According to a survey by Statista, revenue in the NFT market is projected to be worth US$2,378.00 million in 2024. With an annual CAGR of 11.34%, the market is expected to touch $3300 million by the end of 2027. An average user generates as much as 138$, and the number of users is expected to touch 20 million by 2027. This amounts to a vast market potentially in the coming years. In 2021, the trading volume of NFTs has surpassed 14 billion dollars, 400 times the $33 million valuation in 2020, marking yet another landmark in the adoption of the NFTs journey.

Most Popular NFT Marketplaces

There are many NFT trading platforms available in the market, each bringing in something unique to their users. However, listed below are the most popular ones amongst NFT users and are goto platforms for trading and selling of NFT assets.

OpenSea

As mentioned before, OpenSea is one of the world’s biggest NFT marketplaces and allows you to create non-fungible tokens and trade, sell, or purchase them. Founded in 2017, the platform contributes as much as 88% of NFT’s trading volume. OpenSea covers many categories of NFT artifacts, including art, collectible cards, domain names, 3D objects, and more. It supports most blockchain networks, including Ethereum, Solana, Polygon, and e-wallets such as Metamask, and Portis crypto wallets. The platform levies 2.5% of NFT cost as commission.

Variable

Rarible is a decentralized NFT platform allowing users to quickly create, buy, and sell NFTs. It operates on the Ethereum blockchain and enables creators to tokenize their digital content. Its unique RARI governance tokens give users the right to participate in the platform’s governance. It has also announced the development and launch of an NFT marketplace by the name of Dapperflows that will host applications and facilitate speedier transactions.

Binance NFT

Another popular NFT platform amongst the users is Binance NFT. The platform boasts a high volume of trades and more liquidity options than its peers. Binance NFT also provides better security as it requires users to pass verification before using the platform and must have at least two subscribers. A user’s collection is scrutinized thoroughly before a confirmation is given for selling artworks. Binance NFT also supports Initial game offerings, and mystery boxes, amongst other unconventional artworks.

Binance NFT is cheaper than its peers as it levies a low % trading fee of 1%. It also supports almost all popular e-wallets such as Metamask, True Wallet, etc, and supports BNB and Ethereum.

Nifty Gateway

Nifty Gateway is another curated NFT marketplace for collaborating with well-known artists and brands. It boasts a user-friendly interface and often hosts exclusive drops from prominent creators. Founded by Duncan and Griffin Cock Foster and then acquired by the Winklevoss twins, Nifty Gateway has sold NFTs by Beeple, Pak, Refik Anadol, Sam Spratt, XCOPY, Skygolpe, and other widely followed NFT artists.

SuperRare

Built on Ethereum, SuperRare is a blockchain computing platform that allows all its users to verify artifacts and ownership. The platform enables

unique minting of art tokens from the original artists from their wallets. Every bid, sale, and collector details are forever recorded in the token’s history on the blockchain network. This facilitates the security of artworks and maintains the purchase history of these artworks in the long run. Its governance token, $RARE, allows its community to participate in curation via Space Races and in the broader decision-making process for the future of SuperRare.

Architectural Components of the NFT Marketplace

In NFT marketplace development there are few architectural components that are always there in the end product, these are:

• First and foremost a decentralized application or a Dapp to deliver on decentralization features.
• A secure Blockchain network to host NFTs securely with transparency,
• Immutable Smart contracts to govern transactions and trades,
• A place to store NFT metadata which accompanies all NFT purchases and sales and
• Web3 applications create the latest types of services, networks and platforms that are in sync with the newest trends.

Features in NFT marketplace development

For businesses looking to invest in this up-and-coming industry, it is essential to identify all features that are integral to an NFT marketplace. Below are a few of the necessary features of a NFT Marketplace. The utility of the marketplace plays an important factor in deciding what features need to be integrated.

Options for trading NFTs

There should be a platform for buying NFTs, selling them, and bidding on them. Once a purchase is made, the application should securely transfer the assets to the buyer’s crypto wallet while following all regulations.

Dashboard

There should be a dashboard that can showcase all NFT details along with their price and blockchain history details. It should also have other information such as floor price, trading volume, and other essential markers indicating the success metric of those artifacts.

Search feature

There should be search options, filters, and categories listed in the platform’s search bar. This will enable users to quickly search for the artifacts they wish to purchase.

Payment gateway

The platform must have a payment gateway enabling users to make crypto and fiat currency payments. The portal should also allow users to connect to their crypto wallets.

More Unique Features that can be added

Blockchain developers can make the NFT marketplace unique with a few extra features. These features also help businesses gain competitive leverage.

• NFT marketplaces backed by multi-chain networks allow projects to run on two or more blockchains, thus ensuring scalability and stability while decentralizing.
• Many up-and-coming platforms are allowing users to create their NFTs. Thus, it becomes easier for users to create and sell on the same platform. Rarible and SuperRare are two marketplaces that have benefited from this feature in many ways.
• NFT Templates as a feature also encourages users to create and launch on the same platform making the platform more intuitive for beginners.
• Like most retail options, rewards systems can also create an innovative platform. Part of compensation, more trading volume limits, and additional content are a few ways to incentivize platform usage in the long run.

Tech stack and Tools for NFT Marketplace development

Given below are tech stacks that are involved in the development of different components of the NFT Marketplace

For blockchain, one can opt for various frameworks such as

• Ethereum
• Flow
• Solana
• Binance Smart Chain, amongst others.

Frameworks for Smart Contract development include

• HardHat
• Embark
• Brownie
• Waffle

For decentralized storage one can opt for PermaWeb or IPFS. Other excellent data storage options include GraphQL, PostgreSQL and MongoDB.

For front-end development, one can use React, Next.JS or Bootstrap.

Backend development of the NFT marketplace can be done in either PHP, Python or Django. Each has unique capabilities and has a lot to offer.

Steps involved in NFT Marketplace development

Today, any business or individual can develop NFT marketplace with the right resources. However, it is suggested that blockchain developers with expertise in NFT marketplace development be hired. One needs to follow a few simple steps :

Define Your Niche

It is important to understand the niche market before developing their NFT marketplace. The marketplace could deal in a variety of art, ranging from digital artifacts and virtual real estate to mystery boxes, music, and more. The target audience, once identified, provides direction and utility to the application.

Select the Blockchain

The next steps involve choosing a blockchain network for your marketplace. Although Ethereum is the most common blockchain preference, others include Polygon, Binance Smart Chain, and flow. The choice can be made based on various attributes such as scalability, transaction, and community support.

Smart Contract Development

Adding smart contracts to your marketplace is a must, as it adds credibility to a marketplace and makes trading much more efficient. Examples of popular Smart contracts used in NFT development are ERC- 721 and 1155.

Integrate a Wallet System

A secure Wallet system is a sure shot to retain users and help them maintain their NFTs. The marketplace should allow users to connect their external wallets, such as MetaMask or Portis.

User Registration and KYC

More often than not, an NT marketplace handles a large volume of transactions, which is why it is integral to an NFT application to implement KYC procedures. KYC stands for Know Your Customer and ensures that the transaction and users comply with all legal and regulatory requirements.

Create a User-Friendly Interface

An interactive and intuitive interface is sure to help retain customers in the long run. Developers should ensure that search functions and both desktop and mobile interfaces are responsive to multiple types of queries.

Integration of Payment Gateway

To complete an NFT purchase, users need to pay in the form of either fiat currency or cryptocurrency. A secure and reliable payment gateway facilitates smooth payments. ETH is an example of a payment gateway typically used by Ethereum-based NFT marketplaces.

Implement Auctions and Bidding

Every marketplace should have Listing and bidding options. This is sure to encourage art enthusiasts to interact with the platform and trade on it.

Community and Social Features

User profiles and content-sharing capabilities further improve engagement in the NFT Marketplace. A community can be instrumental in improving the platform and understanding what the user wants.

Security Measures and Regulatory

Legalities surrounding NFTs and their sales are often dynamic and volatile. This is why it is important for businesses to be aware of the latest regulations and to have proper measures in place. Using the latest security options can further strengthen the foundation of the marketplace.

Testing

Rigorous testing can help identify bugs early on. Testing smart contracts and user interface iteratively is important for best results.

Launch and Marketing

And Launch! Launching an NFT Marketplace should be accompanied by an effective marketing strategy that can rope in artists, creators, collectors, and users to the platforms. Partnerships and collaborations are quite in trend regarding marketing for NFT platforms.

Needless to say, the NFT space is dynamic. Staying informed about the latest trends and technologies is crucial for the success of any NFT marketplace app development project.

Ways NFT Marketplace monetizes its assets

Typically the NFT marketplace makes money in 4 ways, these are:

• Commission fees: Most marketplaces levy a fee ranging from 1–5% of the value of purchase along with listing fees( aka gas fees)for the release of a single NFT or a collection.
• Registration fees: Marketplaces also charge their artists at the time of registration; this fee changes from platform to platform.
• Governance tokens: Rarible is an example of a marketplace that employs its own governance tokens. Such tokens are mainly used to reward marketplace users who buy or sell collectibles and GIFTs.
• Third-party Advertisements: Advertising third-party resources is a big contributor to revenue generation for an NFT marketplace. Adding blogs and guides further brings revenue.

Cost of NFT Marketplace Development

NFT development solutions can cost anywhere from 30k to 50k but also depend on a variety of factors such as design elements, scale of the projects, integrated features, type of payment gateway, functionalities, and more. The above table helps break down the costs involved in NFT marketplace development.

Advantages of owning a NFT marketplace

Although the benefits of investing in NFT marketplace are many, most popular advantages are given below. These benefits often lure enterprises to invest in NFT marketplace development.

• Authenticity and Ownership: NFT artists can easily rely on blockchain platforms for authentication, security and credibility. Such a marketplace can be instrumental in popularizing digital art and gives artists a chance to monetize it.
• Liquidity: With growing interest in the NFT sector, more and more enterprises and individuals are turning to NFT marketplaces. Decentralization and lack of standardized policies are the reason that NFT Marketplace offers more liquidity.
• Security is a given for any NFT marketplace as it is backed by the blockchain network. Blockchain provides the utmost security against various cyber threats.
• NFT transactions are extremely transparent without compromising on the security aspect. Each transaction is immutable and is governed by smart contracts thus reducing the risk of being manipulated.

Build NFT Marketplace Platform with Openxcell

Enterprises are identifying this trend and hopping on to its bandwagon at an astonishing rate. The search for efficient NFT marketplace development services is quite extensive these days. The process in itself is an elaborate operation and requires expertise and experience. OpenXcell is one such company that delivers on this need. Its clients boast of the extraordinary services it delivers and the success it guarantees. Its rich pool of resources further allows them to craft the best NFT marketplace development solutions.

FAQs

1. How long does it take to develop an NFT marketplace?

A basic NFT marketplace with minimum features requires 6 months or more for development. A more complex project can take anywhere from 8–12 months.

2. Which are the most popular NFT Marketplaces?

Some of the most popular NFT marketplaces are OpenSea, Rarible, Binance, and SuperRare.

3. What is the technology behind the NFT marketplace?

Blockchain is the primary technology behind the NFT marketplace. It provides decentralization to the platform and enables secure transactions.

4. What does an NFT developer do?

NFT Developer is a skilled software engineer who participate in the marketplace’s development. They play an integral role in the development process and are designers of the platform.

5. How much does it cost to develop an NFT marketplace?

NFT marketplace can cost anywhere from $40,000 to $70,000 depending on the project scope.

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