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NFT has been one of the most trending terms for a while now. Arts to gaming - NFts have taken over the globe while emerging as an effective and profitable solution for many. To give you a glimpse - nearly 28.4 thousand NFTs were sold in the art segment itself around the world as of April 2021 and the number is forecast to rise not only for arts but for diverse sectors - music, fashion, gaming and what not!
To leverage the unlimited potential NFTs hold, there has been a significant rise in the number of NFT marketplaces and white label NFT brands. Launching a marketplace for digital collectibles like NFTs can bring huge profit if done right. But how to create an NFT marketplace, how much does it cost to build an NFT, what is the development process - these are some frequently asked questions before one can launch an NFT marketplace. And in this blog we will cover these all as well as the basics about NFTs.
What is an NFT?
An NFT or Non-fungible token refers to a non-interchangeable unit of data stored on a blockchain. Here blockchain is a form of the digital ledger where each block contains a cryptographic hash of the previous block along with transaction data and time stamp. While NFTs are created by using some kind of programming like cryptocurrencies such as Bitcoins, and Ethereum, they have their most unique feature - every NFT has a unique digital signature that makes it completely impossible to trade or exchange them for one another.
NFTs can be created from both tangible and intangible digital objects like music, arts, videos, clothing, and even tweets and they come with exclusive ownership rights. The process of NFT creation is also known as NFT minting. Content creators to business persons - NFTs offer unique ways to monetize content and gain profit from diverse sectors.
What is an NFT Marketplace?
As the name suggests, an NFT marketplace refers to a marketplace where you can store/preserve NFTs on one or multiple domains/sectors like music, videos, virtual avatars, gaming and others and trade them to make profit. You can buy as well as auction the NFTs by making transactions through your crypto wallet. A crypto currency wallet is basically a digital wallet to store and retrieve digital assets.
OpenSea, Axie, Larva labs are some of the NFT marketplaces that are earning high revenue. You too can create an NFT marketplace to leverage the exponentially growing demand for NFTs. And before we guide you through this, let’s know exactly how an NFT marketplace works.
Also Read: How to Create Music App Like Spotify?
How does an NFT Marketplace Work?
Once you choose a good and secure NFT marketplace, next you will need to sign up and connect your crypto currency wallet. Next you need to go through the following steps -
- Choose your domain or area on which you want to create your NFT such as fashion, sports, arts or any other
- Mint your NFTs and define the associated parameters
- Once you are done with listing and completing moderation, wait for the auction
- In such an auction, the buyers put their bids and the relevant transactions happen through the transfer of crypto currencies and digital collectibles
For every NFT marketplace, there are smart contracts that define the specific transaction protocols between buyers and sellers to make the user experience simple, secure, and convenient. These smart contracts are also useful for unique data identification purposes for each NFT.
Guide to Create an NFT Marketplace: Steps to Follow
You too can gain a high profit by creating an NFT marketplace by following the steps mentioned below -
1) Do Market Research
Market research is the initial stage before you invest to create an NFT marketplace. You need to have in-depth knowledge on the current NFT market growth, scope, leading players, their strategies, revenue, and future goals to secure your position amidst the competition. For instance, OpenSea is considered to be the biggest NFT marketplace generating $3.3 billion worth of sales and $82.5 million revenue in December, 2021 itself. You must have in-depth knowledge on all the leading NFT marketplaces, their specialized area/sector like arts, sports, fashion etc. and marketing strategies. This will help you follow the right steps and sustain in the long run.
2) Pick Up Your Niche
Tweets to clothing - NFTs can be created for almost anything and everything. While your NFT marketplace can definitely contain diverse NFTs from different sectors/areas, it is recommended to decide a particular niche as per your expertise. For instance, if you are from the fashion industry then you can focus on creating a fashion related NFT marketplace initially as it will be easier for you to create the marketplace and excel in that easily. Once your NFT marketplace starts and is stable, then you can include more variety in that. To start with, you can target a vertical NFT market composed of market players and end-users who are interconnected through a specific niche. As such a market is not that broad it will be easier for you to grow once you create an NFT marketplace.
3) Outline the UI/UX
The User Interface (UI) and User Experience (UX) come hand in hand for any app/website and your NFT marketplace is not an exception. Always keep your UI easy-to-understand and simple to navigate and at the same time it should be catchy enough to stand out from the other NFT marketplaces.
4) Do Front-End Development
Front end development is a vital part for your NFT marketplace as it determines how your NFT app or website will look like, what features/solutions will be included, and others. You must choose professional developers with expertise in this specific area - NFT marketplace development as they will have clearer vision about your NFT business goals, which framework to choose, and other development-related knowledge.
5) Utilize Smart Contracts
Smart contracts are special types of contracts that are stored on blockchains. Such programming is executed automatically when a predefined set of conditions are fulfilled. They are used widely as token generators in the NFT marketplace. As smart contracts are quite different from conventional coding, you should only hire the developers with relevant experience for the back end development of your NFT marketplace.
6) Test and Launch
Once the development phase of your NFT marketplace is over, you need to test it to ensure that the website/app, and all its features are running smoothly. Also, testing is mandatory to find out any possible loopholes in the NFT marketplace so that you can rectify it before it reaches the end-users. It is advisable to get your NFT marketplace tested by professional testers. Once your NFT marketplace is error-free and capable of running smoothly, you can launch it.
Features to Include While Building an NFT Marketplace
While following the above steps will lead you to create an NFT marketplace, there is another concern to focus on - how efficient it will be? Well, that majorly depends on the features of an NFT app/website. Here’s our professional NFT experts’ suggestions on the must-have features of an NFT marketplace.
The storefront of your NFT marketplace is the first thing the end-users will notice. It’s no less than an informative dashboard for the end-users. Make sure that it contains all the NFT assets-related data such as - owners, bids, related values and history, and previews, to name a few.
Creating listings for digital collectibles is a process that users need to execute frequently. So, listing creation, adding/modifying titles, descriptions, tags and others should be easily achievable. Submitting files to managing listings - all tasks should be done easily through this feature.
Every transaction on an NFT marketplace requires cryptocurrencies and for that the end-users need to create crypto wallets. So, there must be a dedicated feature for crypto wallet creation, receiving and sending cryptocurrencies, making transactions etc. Also this feature should include the option of connecting with the existing wallets easily.
Bid & Buy
No doubt that bidding and buying NFTs are the main activities that take place on an NFT marketplace. So, it’s mandatory to have the relevant feature that will enable the users to easily view, bid, and buy and execute related activities on your NFT app or website.
Imagine thousands of NFTs of various categories are displayed on your NFT marketplace but end-users are unable to find the ones they are looking for. It will be impossible to find unless you have this feature. Make it as compact and advanced as possible by including various conditions for filtering like NFT type, price, relevance, and others.
Though it’s not that much of a core feature, it is recommended. Ratings let the end-users take the right decision while bidding and buying and more importantly, it make your NFT marketplace more authentic. Many of the leading NFT marketplaces have this feature and you too should consider having it.
Factors to Consider While Building an NFT Marketplace
There is more to creating a successful NFT marketplace apart from the above-mentioned pointers. Here’s a brief checklist to remember while creating an NFT -
Many of your end-users are supposed to be new in the world of cryptocurrencies and NFTs. And security is often the first thing they want to ensure. Your NFT marketplace should convey this feeling of security by providing them with secure payment methods, safe token transactions, safeguarded crypto wallet as well as security to personal and sensitive information.
Decentralization is pivotal when it comes to cryptocurrencies and blockchains. It simply implies that all the information is copied and distributed to different blockchain networks so that during the creation of a new block, the related blockchain can make the relevant changes.
Your whole NFT marketplace should be transparent in terms of showing the related transaction details, history, NFT store, and all the related information to each of your end-users. Transparency is necessary to establish an authentic brand image as well driving more returning customers to your NFT marketplace.
Don’t forget about your monetization models as they are what determines the charges/fees during transactions, frequency of payment, and your whole revenue model.
Cost to Create an NFT Marketplace
How much does it cost to build an NFT and NFT marketplace? - it’s the common question that comes once you go through the above information. The cost to create your NFT marketplace may vary on the basis of the type of development, framework chosen, the complexity of the NFT marketplace app and website, and others.
Below is a rough estimation of the cost to create an NFT marketplace based on the features.
The Bottom Line
Building an NFT marketplace is a great idea to start a profitable business and leverage the growing popularity of NFTs. No matter what your expertise is, you can always find a relevant niche to start a profitable NFT marketplace. All you need to focus on is the features and development process as mentioned above. Hiring the right developers can make the whole process no less than a cakewalk.
Looking for professional developers for your upcoming project? Browse through Third Rock Techkno’s wide range of professional services and solutions and get in touch to start today. And don’t forget to have a look at our extensive portfolio for understanding better.