Beeple’s March 2021 sale of his $69million art is the moment that changed everything. Today, NFTs have been used to commodify a variety of digital objects, including sports, arts, digital clips, real property, and gaming collectibles.
To maximize the potential of NFTs, many celebrities around the globe, investors in retail, social media influencers and companies have joined the NFT train. Even cryptocurrency exchanges are now flooding the NFT market and changing the status quo, as they offer more opportunities for users to trade NFTs.
Two of the most popular and well-known crypto exchanges in the world announced their entry in the NFT race in October. This was just months after Binance launched the exchange movement. It is important to ask why crypto exchanges are entering the NFT space, and which exchanges have done the crossover in recent years. Let’s see what happens.
Crypto Exchanges Want To Diversify Their Revenues By Entering NFT
In 2021, the global non-fungible token markets has seen a boom. DappRadar reports that sales volume reached $10 billion in the 3Q.
To diversify their income, some of the most prominent names in crypto exchange have decided to enter the NFT space. Fees they receive from users when they transact are the bulk of revenue that exchanges make.
In an industry with high volatility, it is not something that most founders and crypto execs look forward to in 2022. Coinbase NFT, a marketplace that is owned by Coinbase NFT, has opened a waitlist.
Users can trade, collect and mint a variety of NFTs. Coinbase believes that such a move will lead to new streams of revenue for its crypto exchange, which currently relies heavily on exchange fees.
According to the global crypto exchange, users have had a poor experience buying or making NFTs. It claims that it will improve user experience by introducing NFTs into its portfolio. Users can expect to be able to create NFTs, and then have full control of them through decentralized contracts. Coinbase has also integrated social features to make it more engaging.
The NFT Trend: How the World’s Largest Crypto Exchange Got Started
Binance, as mentioned earlier, was the first cryptocurrency exchange to enter the NFT sphere. It launched its Binance NFT Marketplace where users could freely buy, sell, and make digital assets.
On the marketplace, users can now sell or buy digitized art and trading cards as well as rare virtual items. Binance is currently working to include these items in the marketplace. :
- Standard trading market, where new tokens can be created
- This is a premium space for auctions and exhibitions that are high-profile.
Binance’s payment system is something that digital creators and users were looking out for when Binance revealed its plans a few months ago. The premium segment would receive a 10% cut from major auction proceeds, while the artists will receive 90%.
The daily trading market charges a processing charge of 1% and creators receive royalties. Binance NFT was launched in June 2021. It is home to some the most popular digital creators and collections around the globe.
Helen Hai, Binance’s NFT Project Manager, expressed optimism about the exchange’s entry into the NFT space.
Binance will be able to generate new income streams by offering this platform the highest quality NFT trading platform.
The First LSEG Technology-Powered Crypto Currency Exchange in the World Is Here To Stay
We have AAX among the many high-profile cryptocurrency exchanges that are exploring the NFT space or creating marketplaces. Five NFT art pieces were showcased on the platform by FrankNitty3000, a popular creator at the Hong Kong FinTech Week 2021.
The NFT series titled “The Crypto Gods”, introduces the first cryptocurrency exchange powered with LSEG tech in the crypto space. AAX was established in 2018 and has more than a million registered users from more than 100 countries.
To help increase Bitcoin adoption, the exchange is the first to adopt a Satoshi Standard (or SATS). AAX and FrankNifty3000’s Crypto Gods NFT series is something actors in the NFT scene should reflect upon, particularly the role celebrities, pop culture, and art play in the wider crypto community.
AAX is a new exchange that promises creators and collectors more than any other cryptocurrency exchange.
Crypto.com Announces the Foray into NFTs with Content from Snoop Dogg & Lionel Ritchie
Crypto.com has announced its entry into the NFT market with digital content by global stars Lionel Ritchie (Snoop Dogg) and Crypto.com. The Hong Kong-based exchange stated that it would be the world’s largest and most user-friendly NFT platform at launch.
The announcement by Crypto.com revealed that the platform was an invitation-only one and would allow for solid collaborations between digital artists with mainstream counterparts. After a 60-year absence, Crypto.com and Ashton Martin Cognizant Formula One Team joined forces to launch the platform. This marked the team’s return from F1 with a collection of NFTs.
So why are crypto exchanges diving into the NFT world?
Profits are the simple answer. NFTs are set to be the year 2021, with a market that grew at an incredible 704% in August 2018 compared to last year. The media hype around the trend may have contributed to the increase, but it is notable that the big players in the market were able to sustain such hype.
Some of them can be used as crypto exchanges. NFTs and crypto are intertwined, being from the same parent technology–blockchain.
It makes perfect sense that crypto exchanges would position themselves as the best mover for the NFT vision, having successfully advocated crypto transactions. They’ve made it easy for NFT traders to trade them.
Marketplaces such as Rarible and OpenSea were the only ones that allowed non-fungible tokens to be traded before their creation. They were helpful in growing the industry but some had very high demands that some artists could not meet.
Crypto exchanges have a goal other than raking in the profits. They want to demonopolize the industry and allow new entrants access their NFT works and make them available for sale with minimal or no barriers.
More exchanges have been pushing into the NFT space after Bitcoin’s plunge to $32,000 in summer, prior to the eventual rally to $68,000. In the third quarter of 2021, NFT sales totalled $10.7 billion.
Many celebrities, entertainers, and athletes are investing in non-fungible tokens. There is no doubt that there will be a boom in the future. OpenSea remains the largest marketplace for NFTs in the world, but crypto exchanges such as Binance, Coinbase and AAX may be a strong competitor next year.
Disclaimer: This article is intended for informational purposes only. This article is not intended to be used for legal, tax, investment or financial advice.