In-house NFT Marketplace or NFT as a Service (NFTaaS)? | by TribalScale Inc. | TribalScale | August 2022
Written by: Siddhartha Singh, Product Manager, TribalScale
The non-fungible token (NFT) industry has great prospects, which makes NFT marketplace development a good idea for in-house product development. This market is expected to grow at a CAGR of 35% over the forecast period from 2021 to 2026, reaching $147 billion. The evolution of NFTs has been rapid, unpredictable and meteoric. In all its growth, one common feature shines through – business applications.
Businesses are struggling to incorporate NFTs and stay relevant in the wave of blockchain, metaverse and Web3 dominating the traditional ways. But having said this, NFTs have already become a mainstream phenomenon. This tendency can be explained by the increasing number of influencers involved, the emergence of new game communities and the growing demand for digital art. When it comes to gaining traction, companies can have their own internal NFT marketplace, or they can leverage any existing NFT as a Service (NFTaaS).
Check out these blogs for more introduction to NFTs and how they work:
For this blog I will explore NFT marketplaces and NFTaaS.
According to Consensys, creatives are choosing to sell their intellectual property on NFT marketplaces, and these NFT marketplaces are growing.
Why is this important? That’s important because online marketplaces are growing to eliminate the idea of ”a middleman.” But there is still something else. In a world where forgeries, copies and doubts about originality exist, the origin and validity of rare works of art can be confirmed. The two best marketplaces where you can create and sell NFTs are OpenSea and Rarible.
Big luxury brands such as Dior, Adidas, Birkin, etc., can also take advantage of NFT marketplaces to highlight and reduce counterfeit sales by using NFT tokens to represent the physical products. It will enhance the rarity while showing indisputable proof of ownership. They can also take it a step further by setting up royalty payments for reselling their products. Prada has already partnered with LVMH to create Aura, a blockchain platform that provides buyers with an NFT token for their product that shows its origin, validity and manufacturing process.
NFT marketplace project development involves defining the functionality of your platform. Here you have to think about both sellers and buyers of digital assets. I have selected the main features of the NFT marketplace that you should consider, at least to stay competitive.
Showcase – The storefront is the most important element of your marketplace. Here you will gather all the necessary information, including offers, a detailed description of each NFT, its owners, prices and price history.
Advanced Token Search – This feature will be useful when your users need to find the token quickly. Here you should divide NFTs into categories like music, photos, videos, etc.
Filters – Filters have a function similar to advanced token search, but they include more categories. This tool will help your users identify NFTs based on more than just their type. There will also be categories like price, creators, asset popularity, new offers, etc.
Creating Entries — Allow users of your marketplace to create listings. These can be general lists or, for example, wish lists. It is good if listings show information about NFTs, such as the asset’s title, tags, price or detailed description.
Listing Status – This feature is important to the NFT creators. Thanks to it, they can keep other users updated with the current status of their digital works.
Buy and bid – No eCommerce NFT platform development is complete without the ability to buy and bid. Make sure you add this option to your marketplace so users can easily buy and bid on NFTs.
Wallet – It would help if you also integrated a wallet into your marketplace. As a result, your users will be able to pay for and manage NFTs without leaving your platform.
Ratings – Implement a ranking system to let users of your marketplace know which tokens are most relevant. This feature will be especially useful for beginners in the crypto field.
Auction – The auction is a fascinating feature even for those users who are not yet ready to shop on your marketplace. This feature helps drive traffic to your platform.
Building your own NFT marketplace solution takes the following steps:
1. Define your niche
The first thing you need to do is decide on the type of marketplace: universal or niche. A better option is to list different types of NFTs as it will attract a wider audience.
2. Choose your blockchain
Choose the blockchain you want to build your marketplace on. Some of the most popular are Ethereum and Binance Smart Chain. As of now, the most popular for NFTs have been Ethereum 2.0 and Flow. You can also make your platform support multiple blockchains simultaneously.
3. Determine the project’s UI/UX design
After deciding on a blockchain and a niche, you can think about NFT marketplace design. Make sure your user interface is intuitive and user-friendly.
4. Implement smart contracts
The meat of the entire marketplace development is the implementation of Smart Contracts, and thus the next step is to develop smart contracts for your marketplace. For this, you need to hire experts who understand regulatory requirements.
5. Secure storage
In this step, you should decide where the creators and buyers of NFTs will keep their assets. In addition, you should ensure that records of all transactions are securely stored on your platform.
6. Integrate third-party services
To build a successful NFT marketplace, you need to integrate payment gateways, crypto wallets, social media and email services. These are the basic tools from third-party providers, but you can demand even more. The number of integrations depends on the company’s needs.
7. Test your marketplace
Once you’ve developed a basic version of the NFT marketplace, test it. In this way, you will correct all the shortcomings of your platform and bring your product to perfection.
8. Start your NFT Marketplace
It is the final phase that involves the launch of your marketplace and its ongoing support. You must constantly improve your platform and adapt it to the needs of your users.
NFTaaS is simply third-party building and managing cloud-based networks for companies that create NFT applications. Under NFTaaS there can be many more services, but ideally you should focus on NFT as a White Label service. Like Blockchain as a Service (BaaS), NFTaaS is still a new development although companies are emerging in the NFT field, and legacy businesses are slowly adopting NFTs. However, the demand for NFTaaS companies and services has not peaked yet and will continue to grow as the Internet fully transitions from Web2 to Web3.
How does NFTaaS work? It follows the same model as BaaS by allowing companies to use cloud-based networks and services to build and manage their own NFT applications. The parameters for which services NFTaaS covers have not yet been set, but there will be a more clear boundary in the years to come with more companies needing these services.
The cost of setting up an NFT application is high and many companies cannot afford to be self-sufficient. For example, a company offering NFT services may require software that helps make payments more efficient. They don’t need to build their network to get it done when they can get the service from an NFTaaS company that offers it in exchange for a monthly subscription fee. Businesses need NFTaaS to avoid operating at high costs.
There are very few NFTaaS companies that help businesses transition to the metaverse by offering a branded NFT strategy for businesses. Services are divided into the following five stages, each with key deliverables ranging from conception to post-launch maintenance.
Write
This stage is the planning stage and services include:
- Design NFT strategy
- To compose NFT tools and designs
- Define NFT offers and benefits
- Define royalty rules
- Define NFT design strategy
- Develop pricing strategy
Companies can expect to receive the following deliverables from this stage:
- Strategic advice on brand NFT strategy and NFT utility
- NFT minting and release schedule
- NFT plan before launch and after lunch
Design
The design stage covers all the essential design aspects of an NFT mark, including:
- Develop NFT designs
- Crossover collaborations with famous designers for crossover NFTs
- Develops 2D/3D avatar designs for the metaverse
The deliveries expected at this stage are:
- NFT graphic design
- NFT avatar design
- NFT 3D model
- Embossed final artwork
- Branded storefront design
Mint
Businesses are eligible for these services during the coin stage:
- Development of smart contracts
- Emboss NFT with NFT embossing protocol
- Submit and pre-plan NFT for publication on the brand store
The deliverables for the imprint stage of the branded NFT strategy journey include:
- Smart contract development
- NFT minted on the blockchain
- Pre-schedule NFT for publication
- Ready to sell features on branded storefronts including payment details
Launch
In the launch phase, NFTaaS can offer the following services:
- Development of strategic NFT marketing and PR campaign
- Marketing and promotion of NFT
- Community growth
- Publication and launch of NFT at the brand store
- Hosted an NFT auction sale and launch event
The deliverables during this stage are:
- NFT published on branded shop fronts
- Strategic NFT marketing and PR plan
- Community growth and implementation of marketing
- NFT auction sales
Redeem
This is the final phase and services for the post-launch phase include the following:
- Provides a smooth user experience for NFT holders to use and redeem NFT offers
- NFT education and operational training for brand store staff
- Post-launch community maintenance and loyalty-building activities
- Off-ramping crypto to fiat
The deliverables for this stage include:
- Technical questioning with brands as exciting technology
- White label NFT wallet for your brand
- Personal NFT education and operational training session
- Post-launch community maintenance and loyalty-building activities
- Crypto converted to fiat
