Odaily Frontline | NFT enters the "Wild West" period: Is it a bubble or a revolution?

This article comes fromInsidersecondary title

Odaily Translator | Nian Yin Si Tang

Summary:

Summary:

- NFT sales reached nearly $500 million in the past month alone.

- An encrypted artwork NFT sold for nearly $70 million on Thursday.

- NFT buyers caution that the process can be confusing and includes multiple layers of hidden fees.

Over the past few months, digital assets known as non-funkible tokens (NFTs) have grown in popularity and popularity—celebrities, artists, and investors sell these NFTs to create generated millions of dollars in revenue.

In the past month alone, top NFT platforms have sold nearly $500 million in digital assets, according to CryptoSlam. Digital artist Beeple, whose real name is Mike Winkelmann, sold a work for nearly $70 million on Thursday, breaking online sales records and becoming the third-most-valued living artist behind "Contemporary Pop Art." King" Jeff Koons and "Godfather of British Art" David Hockney.

image description

Beeple's NFT work "Everydays: The First 5000 Days" was sold at Christie's for $69.34625 million

Both creators and buyers are seeing huge profits from NFTs. Miami-based art collector Pablo Rodriguez-Fraile showed for the first time how lucrative the NFT market can be in February when he resold a Beeple artwork for nearly 1,000% more than its original price.

The $6.6 million was the highest NFT sale at the time, but another NFT by Beeple broke the record a few weeks later with nearly $70 million in sales.

These numbers are truly eye-popping and have attracted many people to try to buy or sell NFTs.

"It's like the Wild West," marveled Robert Martin, who spent more than $200 in gas fees.

secondary title

What is the gas fee?

Major cryptocurrencies used on NFT trading platforms include ETH, WAX, and FLOW. On most NFT trading platforms, users are responsible for paying for the computational energy required to process and verify transactions on the blockchain. The gas fee will fluctuate according to the specific time point.

Martin said he spent $30 worth of ETH on Rarible to buy an NFT, only to lose more than $200 on the NFT. Although less than 24 hours after his purchase, a buyer made an offer of 3 times the original price of the NFT.

While additional fees vary from site to site, many popular sites charge users gas fees for minting tokens, as well as selling and buying tokens. Most platforms also require digital wallets, so users must account for switching fees between different forms of ETH.

Martin went on to say that he was taken aback when Rainbow Wallet charged him nearly $80 to convert WETH to regular ETH.

“It was me who received the WETH, but it was hard to tell if I should pay or the sender should pay,” Martin told Insider.

On Martin's digital wallet, Rainbow Wallet, he says the fees are already detailed, but it would be helpful for him to have a reminder or notification about the fees before making a purchase.

image description

"NFT fees can be confusing, especially for new users," said Robert Martin.

“(Gas fees) can be risky for new users,” Martin told Insider. “New users need to get more education before entering the space. It seems that most of the resources are for old players who have already dabbled in the crypto space. "

Another NFT artist with the Twitter account @SHL0MS said that when he created his first NFT, he just wrote off the gas fee, mainly as an experiment.

“This space is changing so fast, and there’s a lot of pressure on artists to use it to their advantage,” said @SHL0MS. “There’s a lot of pressure to start minting and buying NFTs, but for me, I don’t care when it comes to paying fees.” expecting nothing in return, so there is no financial pressure."

Rodriguez-Fraile told Insider that he knew Beeple pieces would one day be worth a lot, but what he never imagined was that a Beeple piece would go from $6,700 to $6.6 million in a few months.

image description

Beeple's 'Crossroads' sells for $6.6 million on Nifty Gateway

"I have no intention of being a flipper, but I also don't like to lose value," said Rodriguez-Fraile. "I also received a higher bid for another work by Beeple, but I chose to keep it because of its historical value. I sell' The only reason for Crossroads' is that I think it can be a great catalyst for realizing the value of digital art."

According to the art collector, these creators are pushing the limits of art. When he first met Beeple, Rodriguez-Fraile knew he would be the heart and soul of the movement.

“Over time, this becomes a whole art world,” says Rodriguez-Fraile. “This is the first time we can mathematically work out the provenance, history, and all the turnover of a work of art. It’s more important than the physical work. Desirable, bringing collectors and artists closer together."

SuperRare CEO John Crain revealed that the company is working on developing new revenue streams for artists, allowing them to connect directly with fans on the site.

"It will be interesting to see a world where everyone is an art collector." Griffin Cock Foster said, "I think we are now in the infancy of NFT. This is a very powerful and transformative technology, and we Not even knowing how it will change the future."

secondary title

There are still many obstacles in the NFT field

Rodriguez-Fraile said that NFTs still have a long way to go before they are accepted by the general public. In particular, platforms need to work on developing a better user experience to avoid confusion around gas fees and make NFTs more accessible to users outside the crypto community.

According to Griffin and Duncan Cock Foster, Nifty Gateway is working to bring NFTs into the mainstream by simplifying the user experience. The site is one of the few platforms that allows users to purchase NFTs using credit cards rather than cryptocurrency wallets.

This process allows users to avoid paying additional fees. Many platforms are also working to mitigate the impact of the context in which blockchains are used by simplifying their use.

For NFT buyers, buying and selling sites can also affect the token’s value, Rodriguez-Fraile said. He further explained that as more and more platforms continue to flood the space, he puts more trust in more specialized sites like SuperRare and Nifty Gateway as they have higher selection criteria for the artists they work with. For users who want to start creating NFTs, community-owned sites like Rarible and Mintable are more accessible for new creators.