Coinbase is preparing to launch an NFT marketplace to compete with other significant players in the area, such as OpenSea, and has announced a customer waitlist for the desktop product, which it hopes to deploy by the end of the year.
Coinbase has provided limited details about its upcoming platform but says in a blog post that it plans to incorporate social elements more deeply. “Coinbase NFT will make minting, purchasing, showcasing, and discovering NFTs easier than ever. We’re making NFTs more accessible by building intuitive interfaces that put the complexity behind the scenes. We’re adding social features that open new avenues for conversation & discovery.”
Even as Bitcoin approaches the all-time high it was flirting with at the time of the Coinbase direct listing, Coinbase’s price has lagged behind the recovering growth of some of the most popular coins in the market, and is now down about 27% since its direct listing in April.
Regulators are also on the exchange’s tail, with the SEC threatening to sue the firm over their Lend yields product, which was eventually canceled. Coinbase is also contending with a crowded competitive landscape for buying and selling cryptocurrency in the United States, as exchanges such as Robinhood expand their crypto offering.
If NFTs continue to attract investor interest from individuals looking for high-priced digital artifacts and art, Coinbase NFT might become a key revenue generator for the now-public firm.
The NFT market is exhibiting more durability than many predicted after spiking earlier this year and again in August, but it is still seeing considerably bigger fluctuations than already volatile cryptocurrency values. In August, OpenSea had a transaction volume of $3.4 billion, which was a new high.
Coinbase is launching with support for the Ethereum blockchain, which isn’t a surprising place to start an NFT rollout, but the company will not be integrating with any Layer-2 scaling networks at launch, which means Coinbase NFT users will still be paying hefty gas fees and dealing with many of the scalability issues of mainnet Ethereum. Coinbase said in a blog post that Coinbase NFT will eventually enable “multi-chain” support, although it is starting with support for the Ethereum standards ERC-721 and ERC-1155. OpenSea, a competitor, just announced support for much lower-cost transactions on the Polygon network.
OpenSea is the market leader, but it is far from the only one with whom Coinbase will have to contend. Rivals like as Binance and FTX have recently declared their entry into the NFT ecosystem. Coinbase is starting far later than some of its soon-to-be competitors, while many crypto investors regard NFTs as just scraping the surface of their possibilities. Nonetheless, given Coinbase’s consumer crypto name recognition, this will almost certainly be a major launch.
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