Ethereum, Solana NFT Marketplace ‘Wars’ heats up when companies acquire startups

Even in the middle of one weakened the NFT market over the last couple of months, top marketplace Open sea has retained the dominant position in the room. But this advantage for the first man can be threatened by rivals who both increase in number and consolidate.

It is according to a new industry report from blockchain the research firm DappRadar, which pointed to the number of NFT marketplaces and aggregators acquired in recent months, and potentially sets up what it describes as “threatening NFT marketplace wars.”

OpenSea itself made the first major acquisition in recent months, acquires NFT marketplace aggregator Save in April. Gem lets users purchase NFTs in batch purchases across multiple platforms, and OpenSea CEO and co-founder Devin Finzer described the move as part of “a need to better serve more experienced, ‘pro’ users.”

Gem will remain an independent platform, but some of the features will also be integrated into OpenSea’s own platform. And OpenSea also recently launched its own Seaport Marketplace Protocolwhich adds advanced features and cuts down on Ethereum gas fees (the costs associated with performing transactions on the network).

However, the Gem move may have been the first domino to fall, as a couple of other high-profile acquisitions followed from other major players. In June, Uniswap Labs – the creator of DeFi protocol and decentralized exchange Uniswap–bought Gem’s biggest rival, Geniewhich offers a similar feature set.

The move will see the largest DeFi protocol, which enables non-custodial trade between users, and now try to recreate the success in the NFT area. “These acquisitions will most likely put OpenSea and Uniswap in direct competition with each other soon,” the DappRadar report assumes.

A day later, the online marketplace eBay announced that it bought KnownOrigin, a long-standing NFT marketplace. Although not a platform that has set up significant trading volumes, KnownOrigin gives eBay the potential to quickly become a player in the NFT area.

An NFT is a blockchain token which can prove ownership of an object, including digital goods such as works of art, profile pictures, video game objects and collectibles for sports and entertainment. The market generated around $ 25 billion in trading volume in 2021, per DappRadarand has already given up around $ 20 billion in organic trade so far in 2022 according to the latest report.

But the potential to change the tide in the NFT market is about more than just acquisitions. Newer rivals are also taking hold, among others Magic Eden and X2Y2.

Magic Eden currently dominates Solana space with a market share of 90% or higher, even in the middle of OpenSea own push into the Solana marketand recently announced a $ 130 million Series B increase which values ​​the company at $ 1.6 billion. The marketplace is looking at expanding to other blockchains, and DappRadar says that it already accounts for 10% of all NFT transactions.

X2Y2on the other hand, is one Ethereum marketplace that offers trading rewards to users like what LooksRare doesalthough LooksRare’s model has been criticized for encouraging “laundry trade” or trades between a user’s own wallets at artificially exorbitant prices. X2Y2, per DappRadar’s data, has bypassed LooksRare in terms of trading volume.

Meanwhile, Coinbase’s own NFT marketplace was expected to create waves across the industry, but so far it has apparently struggling to attract traders. A Coinbase representative told Decrypt that it focuses on the social aspects of the market for now. We will see over time whether this approach can also lead to significant values ​​in the chain.

OpenSea has endured a number of headaches in its rapid rise over the past year, including alleged “insider trading” from a former leader and an exploit that saw some users’ valuable NFTs accidentally sold for under market sums. However, the company’s recent move, including the acquisition of Gem and the launch of Seaport, proposes remarkable steps forward for the market.

Whether that is enough to avoid a potential battle against rising and coming rivals, however, remains to be seen. But NFTs are still sellingdespite falling prices and significantly reduced trading volumes in the midst of the cryptocurrency market crash, so there are still potential opportunities for fierce competition between platforms.

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