What are the Characteristics of NFT trading marketplace

What does “multichain” mean?

Marketplace platforms need to be where users are. Although Ethereum is the largest ecosystem for NFTs, Solana also has an active NFT community, and Polygon’s community is growing. The graph below shows that on average about 12,000 users interact with Magic Eden on Solana per day.

As more and more blockchain projects move towards multi-chain, the trading market limited to one chain will lose its advantage in the competition. OpenSea and Magic Eden are developing multi-chain capabilities, while X2Y2 and LooksRare are still focusing on the Ethereum chain.

What is whitelist management?

Whitelisting is the process of reserving a spot for an upcoming NFT mint. It usually includes several steps to keep the community engaged and the project engaged during the actual rollout.

The management of this activity usually involves a considerable amount of work by the project team. For example, it needs to track Discord channel roles that meet whitelist criteria. Doing this manually or across different platforms is an administration nightmare.

Magic Eden has stepped in to provide tools to simplify this process, offer an integration with Discord to automate this process, and monopolize the minting process on the platform. This helps to increase user retention and utilization of its services.

What are NFT Launchpads?

Launchpads is part of the marketplace that highlights collectibles minted within its platform. Usually, when an item appears on a particular platform, it offers some help in managing all the steps until the actual collectible rolls out. Magic Eden allows creators to mint their collectibles through it, while providing technical and marketing knowledge to creators.

No other platform has developed such a system. OpenSea enables creators to mint collectibles through their smart contracts, but nothing more. Creators still need to handle all the marketing and management of the actual minting and coining.

What is an NFT private sale?

Some NFT marketplace offer functionality to support private sales of NFTs. This is a type of sale where only certain addresses can purchase the listed NFT. It’s like an over-the-counter (OTC) sale, with the added security of taking place on a marketplace platform.

In X2Y2’s case , it doesn’t charge anything for the service, and it also waived copyright fees for creators in the deal. This feature is useful for users who are used to selling directly to other collectors, or in situations where the buyer wants to negotiate a different price that the buyer doesn’t want to be easily available on search.

What is a listing condition pending order?

Conditional pending orders allow sellers to sell two items on the condition that if one is sold, the other will be removed from the listing. LooksRare is the only NFT marketplace that offers this option.

This is useful, for example, when a trader is trying to sell items with specific characteristics of an NFT series and only wants to sell one of them.

What are optional royalties?

Royalty is a fee paid to NFT collectible creators every time a collectible is sold. They are deducted from the gross transaction amount received by the seller, usually between 2.5% and 7.5%.

Now, buyers can choose to pay or not pay on several NFTs trading marketplaces. This happens because royalties are not encoded in the smart contract of the NFT collection, but are deployed as a feature in the marketplace itself. So X2Y2 started offering this feature when purchasing directly on their website.

NFT market trading tokens

Governance tokens are a feature of some NFT trading markets. Whoever provides it also has a fee distribution plan for its token holders to incentivize trading activity.

Although there may be some changes in strategy and value, the reward system is basically the same: users interact with the market by placing orders, buying and selling NFTs to earn tokens, which he can then exchange for different cryptocurrencies, or stake them in the market for Get higher rewards.

What is a collectible offer?

This type occurs when a buyer wants to purchase any item in the collection rather than a specific NFT When the seller accepts the buyer’s offer, the item is purchased and the order is completed.

Collection offer

Traders often use this feature to get items below the reserve price.

What is a bulk order?

Bulk orders are a feature used by traders who want to buy many items and optimize the process to make it faster and cheaper.

The trader can choose the maximum price for each item or the quantity of items he wants to buy, and the platform will make bulk orders

fee structure

Every NFT marketplace Development has a different fee structure. Platforms with more users charge more (2.5% for OpenSea; 2% for Magic Eden). These are also platforms that do not share any part of their revenue with traders.

X2Y2 and LooksRare share fee income with their token holders. Therefore, despite the small number of transactions per day, owning tokens and distributing revenues brings benefits to users due to the higher average value of items traded on it.

The seller pays these fees (meaning that his selling procedure is equal to the face value of the sale minus platform fees and royalties). As we have seen before, these fees are variable and each platform has specific governance (X2Y2 now offers 0% transaction fees).