NFT Marketplace Development: an Ultimate Guide
The digital economy is our actual reality and a high potential future. The latest trend in this field is building an nft platform.
What are NFTs?
Non-fungible tokens are digital files, often sold for millions of dollars, exciting the minds of investors and not only. According to Artnet, the most valuable Non-Fungible Token is worth more than $91.8 million. Nevertheless, there are also less expensive items, over 50% of all NFT sales are below $200.
The most popular NFTs include digital artwork, music, GIFs, photos, tweets, games, etc. Even though we cannot grasp the full potential of NFTs now, developing an NFT marketplace quickly gains popularity, promising attractive prospects for those, who dare.
The companies, dealing with digital content can create an NFT marketplace and attract millions of men of art, put their content on display and earn means for their hard work. The platform owners can also reap returns by reaching a global audience directly.
In 2021, at least $44.2 billion worth of cryptocurrency was associated with NFT marketplaces and collections, while in January 2022 monthly non-fungible token trading volume has already reached a record high of $6.13 billion, according to the Block Data Dashboard.
So let’s find out what NFT and NTF Marketplaces are.
What Is an NTF Marketplace?
An NFT file is a digitally unique file supported and tracked by blockchain technology. This very technology allows buyers and traders to keep a record of file ownership. A creator sells his non-fungible virtual product, while the customers can purchase it with cryptocurrencies. Creators and celebrities are now actively tokenizing their music, paintings, memes, short videos, logos, computer code, and so on. The ownership of the original file remains secure, but its images can be bought, by analogy to museum works of art and their reproductions. The NFT art marketplace then charges a transaction amount every time an NFT is purchased off its platform.
So, a marketplace provides users with a simple and secure experience of NFTs purchasing and selling. Such a platform hosting multiple NFTs becomes a greater source of revenue because it can host multiple tokens, thus becoming also the epicenter of funding.
Before proceeding to the details of blockchain marketplace development and costs, let’s deal a bit with their types.
NFT Marketplace Categories
NFTs are crypto assets and the marketplaces selling them vary in many aspects — style, subjects, formats, audiences, and so on. To categorize them a bit, let’s get acquainted with their main types.
Open and Closed or Premium Marketplaces for NFTs
Open marketplaces can be joined freely and allow a broad array from different sources. However, such platforms offer fewer premium features compared to closed communities.
The leading open NFT marketplace now is Opensea . Being the oldest one, it boasts the greatest amount of registered creators and supports various formats of NFTS: videos, images, 3D, as well as other types of assets, physical and non-physical.
This marketplace is friendly to artists, taking just a 2.5% commission of the sales value. The possibility to search NFTs by keywords makes Opensea one of the best choices in terms of creators’ works promotion on social media and not only.
The drawback of this marketplace is that each NFT listings get less engagement due to the abundance of registered users. Both the audience and the number of items are large. This combined dilutes the engagement.
Binance NFT Marketplace is another example of an open NFT platform for creators and creative fans, NFT collectors, and crypto enthusiasts around the world, boasting the best liquidity and minimal fees.
Closed communities only allow creators to register an invitation, and they are considered a step forward for those, who did well on open platforms.
An example of a closed, yet best accessible through Twitter invite codes, NFT marketplace is Foundation, launched in 2021. The platform rapidly grew in popularity and is now hosting thousands of creators. It is reputed to host only the works of art that deserve high value. The Foundation platform supports PNG, MP4, and JPG, soon expecting Audio, 3D, and AR.
Curated and Non-Curated NFT Marketplaces
These are more specific or specialized sources, that digital artists often use to sell their art and collectible projects. While non-curated NFT platforms are not curated by the company that developed them and the piece of art online can be got within a few minutes. The users can easily access such platforms without any verification.
There are also several more types of NFT Marketplaces.
They focus on such items as movies or sports collectibles. NBA Top Shot was for instance created as an NBA NFT marketplace allowing sports fans to purchase, sell, and trade non-fungible tokens of NBA video highlights.
These platforms provide NFTs specific to online gaming.
The Advantages of NFTs
The Advantages of NFTs for Artists
The NFT process gives artists a way to receive credit for and sell their artwork. Lower barriers to entry enable many more artists to bring their ideas to life and monetize their creations . Creators have a much better shot at turning their work into a viable career path.
The Advantages of NFTs for Buyers and Collectors
People purchasing NFTs are attracted by exclusive ownership. Collectors receive the satisfaction of owning an authentic piece of art. They can also gain income by selling permissions for public use. Other buyers see NFTs as an investment opportunity. With the way the market fluctuates, they will hold onto the file until they can sell it at an income.
The Advantages of NFTs for Gamers
NFT give players the ability to have full control over their assets. Plus, physical ownership gives more incentives to play a blockchain-based game and can be a regular source of income. The rarer an NFT, the higher its value. Blockchain supports the limpidity of digital transactions and demonstrates the rarity of NFT, which leads to an increase in its value.
How an NFT Marketplace Works
Before proceeding to the key features of an NFT platform and the process of its development, let’s first deal with the principle of its work.
NFT Marketplaces look like online stores, they combine a user-friendly front-end environment for file displaying and brokering with a well-designed back-end that supports the blockchain technology it’s based on.
So, first of all, the users need a crypto wallet to operate. Following the common flow, the platform requires a sign-up on the part of the user and a digital wallet to be installed. The latter allows storing cryptocurrencies and NFTs. This digital app does not store digital coins or NFTs like files on a disk drive, but stores the data that indicated the location of the owner’s files on the blockchain. A user can create a collection by displaying the work/digital item and choosing the payment token to accept for it.
Then a fixed price or a bid for the auction should be selected, and the transaction is created after the item has been listed. It launches a smart contract for the creator’s wallet to spell out the terms of a deal between a buyer and seller. They get coded into a self-executing digital contract on the blockchain network, which then gets validated once the customer meets the terms of the seller. From that moment, the transaction is irreversible. Certain operational costs are involved with digital transactions, so the cost of NFT may for instance contain the energy costs of brokering the transaction and converting means into cryptocurrency.
Naturally, NFT marketplaces charge fees on the selling amount, as soon as the funds are transferred.
Now as we have an idea of how an NFT marketplace work, we can look closer into the features it requires since they directly influence the overall development costs.
Features of an NFT Marketplace
When considering an NFT marketplace development, you should realize there are both front-end and back-end concerns. A user-friendly front-end must work well both for artists and buyers making their search simple, as well as effective back-end resources (databases, APIs, etc) must be secure and effective in their operation with NFTs and blockchain technology. The backend should seamlessly handle complicated transactions.
Now, let’s look into the features.
Since NFT platforms are very much similar to e-commerce sites, they require an intuitive storefront to store the necessary data. Site admins should decide how many details should be displayed for each file (owner, details, price history, bids, etc.). For NFT buyers, it’s vital to know the origin and authenticity of their files, as well as a listing of their rarity. Though an individual NFT can’t be copied, creators can release multiple NFTs of the same item, and the marketplace will then label them as «Number 3 of 10.» However, real collectors are often looking for NFTs one-of-a-kind.
Search functionality and filtering options
No matter if your developed marketplace handles any NFT or hosts some from a specific niche, you must decide on the scope of files to trade and the filtering options to build in. Category tagging and management functionality make the trading process faster, since it simplifies the search for collectibles the users want to buy, thus improving buyers’ experience. Consider implementing filtering by such categories as artist, price, and rarity.
Listings and their status
This feature is centered around the sellers and should facilitate their positive experience. When a creator wants to list a file, a well-designed step-by-step path can make it simple. More than that, it’s reasonable to provide clear instructions and forms to simplify selling information and NFT details entering.
Additionally, the marketplace can provide the sellers with data about the number of people who have viewed the file and the bids that were offered during an auction. A good idea to implement notifications when someone makes an offer. It can be realized via e-mails or push notifications both for sellers and buyers, who can be notified about the new non-fungible tokens, the debut of collectibles, future auctions, and so on.
Buying and Auction
As we have already mentioned, NFT marketplaces commonly have several mechanisms of items trading, either direct selling or auction. Even though direct sales may seem a simple feature, the smart contracts on blockchain technology make its development much more complicated than a traditional e-commerce site gateway. Timed auctions often allow creators to get the best price for their items. The competition helps to raise the cost quickly. Yet, you should keep in mind that back-end development for auction sales is more challenging. The NFT developers should take into consideration intense bidding and the necessity to provide real-time sales process updates to the auction participants.
Naturally, all of these make the development of sales mechanisms on an NFT platform more expensive.
Naturally, every user on the World Wide Web is concerned about security, when it comes to crypto transactions, the aspect of security takes the leading position, because the users should not only send and receive crypto payments but also store digital currencies and NFTs without a risk to lose them. So, as a developer, you have two ways out in this aspect — the first option is to integrate existing crypto wallet solutions or create a custom NFT marketplace crypto wallet for your newly created NFT marketplace. Anyway, take care to make your user experience in the financial aspect frictionless and secure.
Ratings help both buyers and sellers. People more eagerly do business with reputable people, so the integration of a rating system will help you prevent your platform users from malicious behavior, like false representations or backing a transaction before the smart contract came into effect.
All these features are must-haves for a new, thriving custom NFT marketplace. However, there are plenty of functions, NFT features, and possibilities you can consider before starting a new platform development. However, it should not in any case prevent you from taking the challenge. All you need is just to accurately brainstorm the features, functionality, essential things to know, and the price range before you step into the world of NFTs.
User Flow on NFT Marketplace
Visitors to your website should create an account by filling out all the required information. You can choose the desired cryptocurrency for trading. Visitors should either build a crypto wallet or link an existing one to save all their currencies in one location. The next stage is to create NFTs. After the registration visitor should provide their digital work. After that products should have been examined and approved before the auction begins. All parties receive notifications once everything is sold.
Prepared NFT Marketplace Tools VS Tailored NFT Marketplace Development
When it comes to NFT marketplace development, the most commonly-ready tool is OpenSea SDK offers a marketplace adapted to your original design. Choosing a professional NFT marketplace development company is a proven option that will exceed your expectations. Experts will take care of the project, handling every element thoughtfully and following your requirements with the possibility of adding new features or upgrading the existing ones at any time. This way, you can attract a bigger audience and profit.
If you do not want to use ready tools, think about developing your project from scratch without ready-to-use tools. It will be more challenging but has its clear benefits.
NFT Marketplace Development Stages and Cost
As an NFT marketplace development company, Stfalcon is eager to go through the entire process of development for you. With our team, your own NFT platform may turn from a project into reality. Traditionally we go through the 4 standard stages and the first is the discovery phase. It’s aimed at finding out all the client’s requirements and expectations, as well as the features of the NFT solution-to-be, needs to have. Our experts then review the feasibility of requirements, analyze the up-to-date technology solutions, and possible integrations, and choose the development tools and the tech stack to cope with the task most effectively. So, we get a profound vision of creating an nft marketplace.
The next stage is UI/UX design development, at times performed by business analysts and designers together to make sure the user interaction with the newly built platform will be smooth, intuitive, simple, and enjoyable.
After all the features and design aspects are agreed upon, the frontend and backend development takes place. While the frontend specialists focus on the platform’s performance, ease of management, and reliability. A huge part of the work is realized in the backend, concentrated on the server-side it includes working on business logic, blockchain, smart contracts technology, crypto wallet integration, sales mechanism implementation, platform functionality, and so on.
Development is always followed by the QA phase to make sure the product is feasible and operates exactly as expected, matching our client’s expectations to the full.
Naturally, the NFT marketplace development cost depends on the features list a client wants to add to the solution developed, as well as on the tools and technologies used. With our company, the cost of a newly developed NFT marketplace from scratch will range from $80k to 100k. A complicated platform with dynamic features may cost you even more.
Stfalcon’s 12+ years of expertise in development is a proven guarantee that you can get a cutting-edge custom platform for NFTs and develop your project with the highest security standards.
If you are planning to build an NFT marketplace, let’s discuss it together and bring your idea to life. Now is the best moment to step on the NFT ground, don’t miss it.