With a market dominance of over 80% since around February 2022, Opensea, the NFT marketplace built on the Ethereum blockchain in 2017, has a stranglehold on the NFT industry.
In January 2022, OpenSea’s monthly trading activity on Ethereum reached a new all-time high of $5 billion, surpassing the previous peak of $3 billion reached in August 2021. In January 2022, at a $13.3 billion valuation, OpenSea raised $300 million in Series C funding.
Competition for beginners
However, competition is growing, and new players are using increasingly aggressive strategies to gain market share. CryptoSlam CEO and Founder Randy Wasinger has predicted additional NFT trading platforms beyond the Ethereum platform. Those markets that have already adopted NFT will prosper as its use becomes more widespread. “And there will be imitators who will do the same, perhaps with slight variations,” he predicted.
In an attempt to lure customers away from OpenSea, the new NFT marketplace LooksRare initiated a “vampire attack” on January 13, 2022. LooksRare, which gave away $LOOKS tokens as a reward for being able to trade, outsold OpenSea by 5 times. However, fictitious trading, in which NFTs are bought and sold between two wallets controlled by the same person or group to receive $LOOKS, has contributed to the increase in volume.
On January 29, 2022, CryptoSlam tweeted that it had adjusted its sales figures for January by deducting more than $8 billion due to fictitious sales. Meebits, the NFT avatar collection, was the hardest hit by fictitious trading, losing $4.4 billion. And then came Loot ($705M), Cryptophunks v2 ($251M), and Terraforms ($2.9B).
By holding an NFT sale of nine Mutant Monkey Yacht Club
While maintaining the liquidation sale of nine Mutant Ape Yacht Club NFTs due to a large discount, the offer sold out almost instantly. CEO and co-founder Zack Burks likened the move to sales promotions provided by Amazon and Alibaba.
NFT marketplaces are getting more competitive with many sites like Rarible and SuperRare joining Nifty Gateway. The NFT gaming marketplace Fractal and in-house collection-specific marketplaces such as Axie Infinity and Larva Labs are just two examples of smaller players tackling these growing niches. Binance, the-ekrona.com and Coinbase are just a few of the cryptocurrency exchanges competing for customers. The leading trading platform in the United States, Coinbase, is working with Mastercard to open up the NFT market.
You have completed your brief knowledge of NFT competitiveness. CryptoSlam CMO Johann Kalpu praised the proliferation of NFT markets, stating that niche players will increase competition and benefit consumers. “It’s like the first customer who wants to check everything out at a big store like Walmart,” he explained. However, he continued, “Whoever is sure of what he wants will go to the market where he will have a better chance of finding a good deal.”