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by : Zahwah Jameel
July 3rd 2023
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Picture a world where digital assets like artworks and collections are changing how we think about money and property. That’s the world we live in today, thanks to the unique phenomenon of NFTs.

NFTs have grown exponentially in recent years, attracting the attention of inventors, investors, and organizations alike. This surge has also given rise to numerous platforms dedicated to the creation, trading, and maintenance of these one-of-a-kind tokens.

As a business owner, you might get intrigued about how this cutting-edge technology can benefit your company and open new avenues for growth and innovation. Navigating this fast-changing market may be difficult, but we’ve got you covered with vital insights and practical guidance to help you stand out from the crowd.

This guide delves deep into the realm of NFTs, covering its pros and cons besides providing a step-by-step process for developing and managing your own NFT platform. We’ll also look at growth, monetization, and promotion techniques to make sure you’re ready to make a splash in the digital marketplace.

So buckle up for an exciting adventure into the world of NFTs, where we’ll uncover the secrets and unveil the opportunities that await you as you build your NFT platform.

Let’s begin!

Unearthing the Magic of NFTs

NFTs, or non-fungible tokens, are one-of-a-kind, indivisible digital assets that cannot be swapped one for one. This distinguishing feature distinguishes them from cryptocurrencies and opens up a world of possibilities for creators, collectors, and businesses alike.

The charm of NFTs comes in their one-of-a-kind nature, as each token has its own inherent worth, much like a rare picture or a one-of-a-kind baseball card. NFTs are altering the concept of ownership and value in the digital era, from digital art masterpieces that sell for millions to virtual real estate transactions.

In 2022, Ethereum’s NFT sphere witnessed a trading volume of 8.22 million ETH across 2.46 million wallets, leading to an $11.3 billion market cap, surpassing the GDP of several countries like Kosovo, Togo, and Somalia. The NFT market is projected to grow at a 33.7% CAGR, reaching $231 billion by 2030.

A Brief History of NFTs: From Insignificance to Stardom

NFTs, like many other exceptional innovations, had humble beginnings. Let’s go on a time-travel voyage to learn about the significant events that shaped the NFT landscape as we know it today:

  • CryptoPunks and CryptoKitties are the pioneers:

The delightful 8-bit avatars known as CryptoPunks were presented to the public in 2017, followed by the irresistibly attractive CryptoKitties. By showcasing the possibilities of digital collectibles on the blockchain, these ventures laid the framework for the NFT revolution.

  • The Art Movement:

As digital artists began to embrace NFTs, high-profile sales such as Beeple’s “Everydays” and Banksy’s “Morons” tokenization brought NFT art into the general consciousness.

  • NFTs Take Center Stage in the Adoption Wave:

Celebrities, sports teams, and even large corporations joined the NFT bandwagon, boosting the popularity of digital collectibles and broadening the use cases for non-fungible tokens.

  • Building the Future of Digital Assets:

Today, the NFT ecosystem is expanding at a rapid pace, with new initiatives, platforms, and applications emerging that push the limits of what NFTs can do.

As we look at the many types of NFTs, you’ll see how they’re reshaping sectors and opening up new prospects for innovation and growth.

The most expensive Cryptopunk sold

Image: CryptoPunk #7523, the most expensive CryptoPunk ever sold for 11.75 million dollars (Source: OpenSea)

The Diverse World of NFTs: The Types of Tokens

NFTs exist in various forms, each captivating in its way. There is something for everyone among the varieties of NFTs available. Let’s take a quick look at the numerous forms NFTs can take:

Digital Art: Revolutionizing the art world one pixel at a time

NFTs are being used by artists to make and sell digital masterpieces that can be traded, collected, and displayed in the same way that traditional art is.

NFTs are offering the art world a whole new canvas to showcase their ability, from Beeple’s record-breaking $69 million auction of “Everydays” to unique digital works by rising artists.

Beeple

Image: Beeple (Credit: Gadgets360)

Collectibles: From trading cards to virtual sneakers

Remember how exciting it was to collect trade cards or unique stamps? With virtual collectibles ranging from digital trading cards to exclusive virtual fashion items, NFTs bring that enthusiasm into the digital sphere.

CryptoKitties, NBA Top Shot, and Sorare are just a few examples of digital collectibles that have piqued collectors’ interest around the world.

Virtual Land: Real Estate in the Metaverse

Have you ever wished to create your virtual paradise? NFTs enable this by allowing users to buy, sell, and develop virtual land in explorable and monetizable digital environments.

Virtual land ownership is being pioneered by platforms such as Decentraland, The Sandbox, and Somnium Space.

Gaming Assets: Leveling up the gaming experience with NFTs

NFTs improve the gaming experience by allowing players to own their in-game assets, exchange them with others, and use them across numerous platforms.

Games like Axie Infinity and Gods Unchained provide actual ownership of in-game assets, stimulating commerce, and encouraging cross-platform interoperability.

Other Emerging NFT Categories: Uncharted digital territories

The possible uses for NFTs continue to develop, paving the door for innovations ranging from tokenized event tickets with NFT-backed VIP experiences to digital fashion items that may be worn in virtual worlds. Who knows what will be the next major NFT trend?

The Technology Behind NFTs

Technology Behind NFTs

At the heart of the NFT phenomenon is a powerful and disruptive technology: blockchain. The blockchain’s decentralized, secure, and transparent nature makes it the ideal basis for NFTs, assuring that these digital assets are secure, verifiable, and resistant to fraud.

Key blockchain elements that enable the NFTs include:

Decentralization

Blockchain functions on a decentralized network of computers, ensuring that no single party may control or modify the data, fostering confidence and transparency in the NFT ecosystem.

Immutability

Once a piece of data (such as the ownership of an NFT) is registered in the blockchain, it becomes essentially tamper-proof, providing a safe and verifiable record of ownership for digital assets.

Smart Contracts

Smart contracts, which are self-executing pieces of code, form the foundation of NFTs. They enable the creation, trading, and management of these unique tokens, automating procedures and assuring the smooth operation of the NFT market.

Interoperability

NFTs can be built on a variety of blockchains, including Ethereum, Binance Smart Chain, and Flow. Cross-chain compatibility and partnerships are growing as technology improves, boosting the possibilities for NFTs even further.

Take a look: The Ultimate Guide to Blockchain Development

The Abundance of Benefits: How NFTs Can Transform Your Business

As a business owner, you might wonder how NFTs can assist your company and increase your profits. In this section, we’ll look at the many benefits of NFTs for businesses. We will also cover some success stories from diverse industries.

Monetizing Digital Assets

NFTs enable organizations to monetize digital works such as art, collectibles, and even virtual experiences, converting intangible assets into revenue sources.

Increased Customer Engagement and Loyalty

Businesses may develop emotional ties with their customers by offering exclusive, limited-edition NFTs, increasing engagement, and fostering long-term loyalty.

Adding New Revenue Streams

Businesses can use NFTs to experiment with new revenue streams such as virtual items, digital partnerships, and even tokenized memberships or subscriptions.

Securing Intellectual Property Rights

The blockchain technology that underpins NFTs provides a safe and verifiable method of establishing and protecting digital ownership, allowing firms to defend their intellectual property in the digital arena.

How do NFTs offer Profitability and Long-Term Value Potential?

Investing in NFTs as a business can offer significant rewards because the unique, rare nature of these digital assets frequently leads to increased demand and, consequently, higher value over time.

The potential for royalties increases the profitability of NFTs, as creators can earn a percentage of the money from secondary sales, ensuring continued income long after the first sale.

Real-World Insight: NFT Success Stories from Various Industries

Here are some examples of how NFTs have helped businesses reach success.

Top Shot and the NBA: Redefining Sports Memorabilia

NBA Top Shot has taken the sports world by storm, providing fans with one-of-a-kind, legally licensed digital highlights that can be bought, sold, and exchanged in the same way that traditional sports memorabilia is.

NBA Top Shot

Image: NBA Top Shot (Source: NYTimes)

Gucci’s Virtual Sneakers: Luxury Brands Embracing Digital Fashion

Gucci and other luxury labels have entered the NFT arena, developing digital fashion goods such as virtual sneakers that can be collected and even worn in virtual worlds.

Gucci's Virtual Shoes

Image: Gucci’s Virtual Sneakers (Source: TheVerge)

Innovators in the Music Industry: Kings of Leon’s NFT Album Release

Kings of Leon made history when they released their album “When You See Yourself” as an NFT, providing fans with exclusive rewards such as front-row concert tickets and behind-the-scenes access.

Navigating the NFT Space: Obstacles and Considerations

While the world of NFTs is full of opportunities, it is critical to be aware of the risks and concerns that come with the territory. In this section, we’ll look at the issues that organizations should consider before entering the NFT market with examples and solutions.

Legal and Regulatory Obstacles

Businesses must negotiate the complex legal framework surrounding digital assets as NFTs gain popularity. Copyright, licensing, and ownership issues must be addressed, and firms must keep up with the ever-changing regulatory environment to maintain compliance.

For example, the dispute between artist Richard Prince and his NFT artwork “New Portraits” raised issues of intellectual property and fair usage.

To avoid such issues, firms must collaborate with legal specialists to set clear ownership and license terms for their NFTs while adhering to intellectual property rules.

Environmental Concerns and the Struggle for Long-Term Solutions

Blockchain technology, especially proof-of-work systems like Ethereum’s, can be energy-intensive, raising environmental concerns. Businesses entering the NFT industry should focus on sustainable solutions as public knowledge of these challenges rises.

Consider Ethereum’s energy-intensive proof-of-work technology, which has been chastised for its environmental impact.

Businesses can reduce their environmental impact by using more energy-efficient blockchain systems, such as Ethereum 2.0 or Flow, or by supporting initiatives such as carbon offset schemes.

Read more about Ethereum: Ethereum Starter Kit: Smart Contract Development For Beginners

Risk Management and Fraud Prevention

While the blockchain technology underlying NFTs provide increased security, no system is completely immune to fraud. Businesses must be careful in preserving their digital assets and putting in place safeguards to avoid counterfeiting and illicit dissemination of NFTs.

Nifty Gateway, an NFT marketplace, witnessed a series of account takeovers in early 2021, resulting in illicit sales and transfers of users’ NFTs.

Businesses should establish comprehensive security measures, such as two-factor authentication, strong password regulations, and frequent security audits, to safeguard their platforms from fraud and unwanted access.

Protection of Platform Security and User Privacy

The security of your NFT platform is critical, as is protecting your users’ privacy. To protect against hackers, data breaches, and other criminal acts, strong cybersecurity measures should be put in place.

Topps, a famous trading card platform, suffered a data breach in 2020, revealing the personal information of thousands of customers.

To protect customer data and keep their trust, businesses should invest in strong cybersecurity measures such as encryption and secure server infrastructure.

Building Your Own NFT Platform: A Step-by-Step Guide

The road to building your own NFT platform may be both exhilarating and intimidating. But don’t worry! We’ve created a step-by-step guide to assist you to get through the procedure. And remember, if things start to get out of hand, you can always team up with industry experts to get the task done quickly.

Establish your niche and target audience

Begin by determining your NFT platform’s specialized niche and target audience. Are you primarily interested in digital art, virtual real estate, or game assets? Knowing your specialty will allow you to modify the features and functionality of your platform to match the needs of your audience.

NBA Top Shot, a prominent NFT platform, for example, focuses solely on NBA-licensed digital artifacts, appealing to basketball aficionados and collectors.

Selecting the Best Blockchain

Choose the best blockchain platform for your NFT platform, taking into account elements such as transaction fees, energy efficiency, and community support.

Ethereum is now the most popular option, although competitors such as Binance Smart Chain, Flow, and Tezos are gaining popularity. For example, CryptoKitties, which was originally created on Ethereum, decided to migrate to the flow blockchain to address scalability concerns.

Create the Technical Backbone for the Platform

Create the architecture of your NFT platform, including smart contracts, user interfaces, and backend services. If you aren’t an expert in this field, consider collaborating with a development team that has experience implementing blockchain-based applications.

For example, the successful NFT marketplace OpenSea employed a talented development team to build a user-friendly platform that supports a diverse variety of digital goods.

Implement security and privacy safeguards for users

Make sure your platform has strong cybersecurity safeguards in place, such as encryption, secure server infrastructure, and frequent security assessments. Also, be open about your data collection techniques and follow privacy laws.

Rarible, another well-known NFT platform, prioritizes security and user privacy, establishing stringent verification methods and conforming to the EU’s General Data Protection Regulation (GDPR).

Create a unified user experience

To make your platform accessible and user-friendly, focus on creating an intuitive user interface and a smooth onboarding experience.

Check out NFT platforms like Foundation for ideas which has a modern, minimalistic design and an easy-to-use interface that appeals to both makers and collectors.

Market and promote your platform

Once your platform is operational, it is time to spread the word. Create a marketing strategy that incorporates content marketing, social media promotion, and collaborations with industry influencers or artists.

SuperRare, a major digital art NFT platform, has effectively built a significant user base and attracted attention to its site by using partnerships with well-known artists and social media campaigns.

Managing Your NFT Platform: A Strategy for Long-Term Success

Once your NFT platform is up and operating, it is critical to focus on good management to ensure its long-term success. Here are some critical considerations for managing your NFT marketplace:

Improve the user experience on an ongoing basis

Collect input from your users on a regular basis to find areas for improvement in the platform’s interface, features, and functionality. Update and improve your marketplace to maintain it user-friendly and competitive.

Zora, for example, has continually iterated on its platform design in response to user input, making it more intuitive and visually appealing.

Encourage a thriving community

Engage your users and create a vibrant community around your platform. Encourage connection with your platform’s creators and collectors by hosting forums, social media, and events.

Consider how Axie Infinity has created a healthy community by conducting tournaments, establishing a Discord server for player engagement, and giving resources for gamers to learn and grow inside their ecosystem.

Create a strong moderating mechanism

Implement a strong moderation mechanism to keep your platform a safe and welcoming place for all users. Monitor content, enforce platform rules, and resolve any disagreements or issues that emerge.

Mintable, for example, has created a robust creator verification process, ensuring that only confirmed individuals can mint and sell NFTs, reducing the danger of fraud and copyright breaches.

Keep up with the newest industry trends and breakthroughs

Keep up to date on the newest advancements in the NFT and blockchain industry, and change your platform to accommodate new technologies and trends.

For example, Efinity by Enjin has embraced the ecologically friendly Polkadot blockchain, giving consumers additional options and flexibility while addressing the NFT industry’s growing worries about energy usage and sustainability.

Create strategic alliances and collaborations

Collaborate with artists, companies, and other industry stakeholders to boost the visibility and credibility of your platform. These collaborations can assist you in reaching new user groups and expanding your platform’s services.

VeVe, for example, has worked effectively with brands such as Marvel, DC Comics, and Cartoon Network to create distinctive digital treasures that appeal to a wide range of fans and collectors.

Optimize and scale the infrastructure of your platform

As your user base expands, ensure that the infrastructure of your platform can handle the increasing traffic and demand. Optimize your platform’s performance, security, and scalability on a regular basis to ensure a consistent user experience.

Sorare, for example, has consistently invested in its platform infrastructure to meet the increasing demand for its soccer-themed digital collectibles while also ensuring a good user experience.

Monetization Strategies for Your NFT Platform: Turning Creativity into Cash

Creating a successful NFT marketplace requires not only a fantastic user experience and a vibrant community but also a sustainable revenue model. Here are some monetization strategies to consider for your NFT marketplace:

Transaction fees

Charge a percentage fee on every transaction that occurs on your platform, including sales, bids, and transfers. This is a common strategy used by marketplaces like OpenSea, which typically charges around 2.5% on every sale made on the platform.

Listing fees

Charge creators a fee to list their NFTs on your platform. This can be a flat fee or a percentage of the NFT’s value. This approach can help cover the operational costs associated with maintaining the platform and curating content.

Premium features and memberships

Offer premium features and memberships to users for a fee. These premium services could include enhanced visibility, priority support, or exclusive access to special events or content. For example, SuperRare offers “Rare Spaces,” which are exclusive galleries for premium members to showcase their NFT collections.

Advertising and sponsored content

Allow brands, artists, or other stakeholders to pay for advertising or sponsored content placements within your platform. This can take the form of banner ads, sponsored collections, or promoted NFT listings.

Partner with established brands

Collaborates with well-known brands to create exclusive, officially-licensed NFTs that can be sold on your platform. The partnership can be monetized through revenue sharing or licensing fees.

Ancillary services

Offer additional services related to NFTs, such as art advisory, NFT valuation, or bespoke NFT creation for a fee. These services can cater to both creators and collectors, providing them with expert guidance and tailored solutions in the NFT ecosystem.

NFT Marketing and Promotion Strategies to Increase Market Visibility

To attract producers and collectors to your NFT marketplace, you must have a robust marketing and promotion strategy in place. Here are some successful techniques to increase your platform’s visibility and user base:

Leverage social media

Creating a strong presence on popular social media platforms such as Twitter, Instagram, Facebook, and LinkedIn to reach a larger audience. Share interesting news, highlight prominent artists and their work, and generate excitement about future events and releases.

Collaborate with influencers

Partner with NFT and blockchain influencers to market your platform. These influencers can share their marketplace experiences, promote their NFT collections, or even develop unique content for your platform, thereby attracting their following to your marketplace.

Organize virtual events and webinars

Organize virtual events, webinars, or panel discussions to engage your target audience and highlight your platform’s unique features. Invite industry experts, artists, and collectors to offer their knowledge and experiences, establishing a feeling of community and trust in your marketplace.

Use content marketing

Create high-quality, instructive content like blog pieces, how-to guides, and case studies to educate potential users about your platform and the NFT space in general. This can assist in establishing your platform as a reliable source of knowledge and increase organic traffic via search engine optimization (SEO).

Utilize public relations

Reach out to media outlets, journalists, and industry magazines to convey your platform’s story, introduce new features or partnerships, and highlight success stories. This might help develop buzz and legitimacy for your platform.

Form strategic alliances

To boost the visibility and legitimacy of your platform, develop strategic collaborations with artists, companies, and other industry stakeholders. These collaborations can help you reach new user groups and improve your platform’s services, attracting additional users in the process.

Provide incentives and rewards

Create incentives for people to join your platforms, such as referral programs, fee savings, or access to special content. These incentives can assist in attracting new users and encourage existing users to invite their network, thereby organically boosting your user base.

Participate in industry events and conferences

Attend and participate in industry events, conferences, and meetups to network with possible partners, creators, and collectors. This can help you stay up to date on the newest trends, demonstrate your platform’s advantages, and attract new users.

Lessons from Competitor Platforms: Learning from the Experts

The world of NFT marketplaces is flourishing, with platforms like OpenSea, Rarible, and SuperRare leading the way. To build a successful NFT platform, it’s critical to learn from these industry titans and understand the techniques that have propelled their success. Here’s an in-depth look at their methods.

User-friendly interfaces

A consistent user experience is critical for attracting and retaining consumers. In order for users to effortlessly traverse the platform, access content, and execute transactions, successful NFT platforms require intuitive design.

Efficient customer service

Effective customer service contributes to the development of trust and loyalty. Top NFT platforms respond swiftly and helpfully, addressing user concerns and fixing issues.

Strong Community

Fostering a thriving community around the platform stimulates user participation, collaboration, and content development. Leading NFT platforms regularly engage with its members via social media, forums, and events, fostering a sense of community and support.

Strong security measures

In the age of digital assets, security is critical. To safeguard user data, transactions, and digital assets from fraud and cyber threats, successful platforms use strict security measures.

Strategic alliances

Forming alliances with well-known artists, companies, and industry players can increase a platform’s visibility and reputation. These partnerships assist in attracting new users while also providing exclusive, high-quality material.

Unique selling elements and innovative features

Successful platforms offer distinctive features and selling aspects to stand out in the congested NFT marketplace landscape, such as:

  • Cross-chain compatibility and support for many blockchain networks are features of OpenSea.
  • The decentralized nature of Rarible and the RARI governance token
  • The emphasis on high-quality, curated digital art at SuperRare

The Future of NFTs and Digital Marketplaces: A Brave New World

As the NFT ecosystem evolves and expands, staying ahead of the curve and anticipating future advancements that will affect the sector is critical. The following are some major trends and predictions for the future of NFTs and digital marketplaces:

Future NFT trends and advancements include:

  • Incorporating NFTs into virtual and augmented reality experiences: The metaverse, virtual worlds, and augmented reality experiences are expected to become more integrated with NFTs, allowing users to own, trade, and showcase their digital assets in immersive environments.
  • The rise of non-traditional financial instruments: Tokenized real estate, stocks, and other financial assets will expand the scope of decentralized finance (DeFi) and wealth management.
  • The growing significance of NFTs in the gaming industry: NFTs are being integrated into game development ecosystems to create unique and tradable in-game assets, increasing the gaming experience and generating new revenue streams.

Earn Passive Income through DeFi: DeFi Lending: How to Earn Passive Income With Crypto

The possibility of widespread adoption

Several causes could push NFTs into the mainstream:

  • Platforms and interfaces that are easier to use: Simplifying the user experience will lower the barrier to entry and encourage more people to learn about NFTs.
  • Increased public awareness and understanding: As the general public becomes more familiar with NFTs, they will be more inclined to adopt this new form of digital ownership and trade.
  • NFT incorporation into popular social media platforms and apps: NFT adoption can be accelerated via seamless integration with platforms that users already use on a regular basis.

The Impact of NFTs on the Future of Digital Commerce

NFTs will play an important role in the future of digital commerce by:

  • Allowing creators to directly commercialize their digital assets: NFTs enable artists, designers, and other creators to sell their work without the use of intermediaries, resulting in a more equitable revenue model.
  • Democratizing access to one-of-a-kind and rare collectibles: NFTs enable anyone all over the world to buy, sell, and exchange valuable digital assets, erasing geographical and financial obstacles.
  • NFTs enable the secure transfer of digital assets across many platforms, making digital ownership more tangible and verifiable.
  • NFTs can assist streamline the process of awarding licenses and managing IP rights, opening up new options for creators and enterprises.

Keep Reading: Clutch Recognizes OnGraph Technologies Among India’s Top Blockchain Developers for 2022

Collaborate With OnGraph to Build Custom NFT Platforms

The realm of NFTs and digital marketplaces is both intriguing and promising. As we’ve seen throughout this blog, there are several ways for enterprises to enter this dynamic market by developing their own NFT platforms.

Businesses can navigate this new world by learning from successful platforms. Staying up-to-date with the latest industry trends is crucial. It’s also important to address obstacles and concerns when developing an NFT marketplace.

Creating a viable NFT platform, on the other hand, maybe a hard task. But, you can collaborate with industry pros and make all the difference. At OnGraph, our team of professionals is committed to assisting you in realizing your NFT marketplace vision.

We’ll collaborate to create a user-friendly, secure, and innovative platform. Our expertise in blockchain and digital assets will help you stand out in the NFT landscape. Contact us to join us on this exciting adventure and realize the full potential of NFTs for your organization.

ABOUT THE AUTHOR

Zahwah Jameel

A software engineer with a deep interest in writing blogs and web content on various tech stacks.

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