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The FTX US cryptocurrency exchange has launched its new NFT marketplace on Oct.10. FTX NFTs will first provide NFTs minted on the Solana network, but will soon add support for Ethereum - the dominant blockchain for NFTs - in a bid to steal some of OpenSea's thunder.
FTX US Will First Mint NFTs With Solana and then Move Ahead With Ethereum Network
Unlike OpenSea and decentralized Solana markets such as Solanart and DigitalEyes, FTX NFTs let users purchase and trade items in US dollars using credit cards or money transferred by ACH bank transfer or wire transfer. Users can also purchase and trade cryptocurrencies.
The NFT marketplace, like the centralized FTX US exchange, is regulated in the United States, which means users from the United States or elsewhere must pass know-your-customer (KYC) identification checks.
This is a significant departure from the aforementioned exchanges, however, the ability to purchase NFTs with USD and credit cards may assist increase mainstream acceptance.
“NFTs right now is a very niche market specifically because it has grown up as a DeFi product,” FTX US President Brett Harrison said.
“We hope by providing a centralized marketplace for NFTs where we let people fund their account with a credit card or with a wire transfer,” he added, “it will bring a lot more liquidity in general to the marketplace, and result in better price discovery and fair markets.”
An NFT functions similarly to a deed of ownership for a rare digital object. With $2.5 billion in transaction volume in the first half of 2021, the NFT industry expanded.
Following a summer dip, the market reached fresh highs in the third quarter.
How Does It Work?
FTX NFTs will first support the Solana blockchain, which has witnessed increased NFT trade activity from prominent collections such as Degenerate Ape Academy and Solana Monkey Business.
Both collections have had single-NFT sales of over $1 million, as well as millions of dollars in overall weekly activity.
Unlike Solanart, the portal would not offer collections in a carefully curated manner. Being a centralized, regulated exchange comes with some restrictions.
Projects that, for example, give royalties on secondary NFT sales as an incentive to other holders will not be featured on the site.
FTX NFTs charges a 2% commission on sales, which is lower than OpenSea's fixed 2.5% commission and Solanart's 3 percent commission.
Unlike other Solana NFT markets, FTX will allow users to sell through auctions as well as fixed pricing listings.
FTX US is collaborating with project developers to validate collectibles that arrive on the marketplace and eliminate fraud.
The High Aims to Compete with OpenSea
Solana's meteoric growth in recent weeks has resulted in millions of dollars in fees for NFT markets such as Solanart and DigitalEyes.
FTX US is squeezing into the fledgling Solana NFT sector with a huge user base and reach, as well as reduced costs, auction features, and the addition of USD payments.
"We're hoping and sort of anticipating to be able to acquire a substantial amount of market share."
Harrison feels FTX US is in a good position to knock the wind out of OpenSea's sails.