How To Create An NFT Marketplace Website?
NFTs, or non-fungible tokens, are a flourishing area of the crypto economy. According to NonFungible.com, the general capitalization of significant NFT projects rose by over 2,100 percent in the first quarter of 2021. Many NFT tokens are now sold immediately, with the most popular ones fetching over $70 million.
In this guide, we will discuss in detail how to create an NFT marketplace. We will go through the mapping goals, networks, protocols and standards, budgeting, benefits and key features, and necessary technology stack on how to create the NFT platform, from its testing to its launch, to its maintenance, and much more. Let’s jump right into it!
What Is an NFT?
Simply put, a non-fungible token (NFT) is a one-of-a-kind digital asset that can be traded between the buyer and creator. Each token has a distinct value and cannot be exchanged.
- Indivisibility - It is impossible to split NFTs down into smaller amounts or to buy or transfer a piece of them.
- Uniqueness - Each NFT has a unique feature that is frequently captured in the token data. NFTs all have their own personalities, and no two are the same.
- Ownership - These tokens ensure the ownership of the asset being transferred.
- Scarcity - One of the factors boosting the value of NFTs is their scarcity. Developers can create as many assets as they want but can also restrict the amount of NFTs for scarcity.
- Interoperability - Using a decentralized bridge or centralized custodian service, NFTs can be exchanged, acquired, or sold across multiple DLTs.
- Transparency - Buyers can trust and verify the validity of a specific NFT since public distributed ledgers are decentralized and immutable, with records of token issues, transfer, and activity that can be publicly confirmed.
Key Benefits of NFTs
The advantages of non-fungible tokens are largely determined by their rarity. NFTs are created on the blockchain, which means they are connected to one-of-a-kind data. The specific properties of NFTs indicate their ability to add value. Simultaneously, NFT manufacturers have the option of releasing a restricted number of NFTs to create supply scarcity.
The capacity to prove ownership is the main advantage of non-fungible tokens. Because they operate on a blockchain network, NFTs can help connect ownership to a single account. NFTs are also non-distributable and cannot be shared among multiple owners. At the same time, the benefits of NFT ownership prevent customers from getting counterfeit NFTs.
Because NFTs are based on smart contracts, their use simplifies ownership transfers. Before ownership transfers may be completed, smart contracts establish certain conditions between the buyer and seller that must be satisfied.
What Is an NFT Marketplace?
An NFT marketplace platform is a decentralized platform where users may generate, purchase, sell, and store non-fungible tokens. They primarily focus on selling specific assets, such as digital tokens of artwork, games, soundtracks, or any other artistic production, together with information about their ownership and validity.
NFT crypto is a type of cryptocurrency used to acquire and trade digital assets. Users can either pay a predetermined amount for tokens or bid on them in an auction. While some NFT platforms specialize in a single industry, such as digital art, others sell a wide spectrum of NFTs, including everything from in-game collectibles to web domains and trading cards.
NFTs are used in many different industries, including:
The usage of NFTs in blockchain-based gaming allows users to safely exchange in-game items while also ensuring legitimacy and validity. NFTs also allow for the open trading of uncommon goods for cash in a safe and secure gaming environment. They are a fantastic way to get virtual ownership of rare and unique gaming items while generating income by utilizing users’ gaming abilities.
- Real Estate
This is the most fascinating idea for tokenization since the property is tokenized on a blockchain network. A single property is fractionalized into many assets that investors may acquire on a blockchain-based market, letting individuals own a piece of it. The tokenization of real estate enables smooth transactions when purchasing or selling a home, removing the need for third-party mediators and preventing any disputes over land or estate ownership.
In May 2021, UC Berkeley stated that patent disclosures for two Nobel Prize-winning technologies, CRISPR-Cas9 gene editing and cancer immunotherapy, will be auctioned off via NFTs. Because the NFTs only pertain to the university patent disclosure form, an internal form used by researchers to report innovations, the institution will retain ownership of the patents for these inventions.
Counterfeit products and tickets are a major problem in the sports business, which the blockchain can help solve. With the aid of tokenized game tickets produced on the blockchain network comes the immutability of blockchain bans counterfeit items and tickets. This is a fantastic application of non-fungible tokens. Although game tickets may all seem the same, each one will include unique identifiers that link it to the designated owner on the blockchain. Sports NFTs have recently gained traction with well-known sportsmen becoming tokenized assets on the blockchain, with their worth determined by how well they perform.
Musicians may now tokenize and publish their work as non-fungible tokens thanks to the blockchain and technology that powers the network. This has broadened the range of possibilities available to artists to monetize and profit from their music, as well as other content related to the music and the artist's public image. Additionally, during the COVID-19 pandemic, artists used NFTs to increase their revenue, since the music industry suffered an 85% revenue fall.
Provenance, or proof of ownership and origin of art objects, is provided via the blockchain. Copyright protection for digital artists is becoming increasingly challenging. Using NFTs, one may purchase a work of art and display it in a digital environment while being fully aware of the asset's history, including the artist's identity, date of creation, list of previous owners, and asset’s worth throughout its lifespan.
Nike received a patent in 2019 that allows the blockchain technology to connect cryptographically protected digital assets in the form of NFTs to real items, such as a pair of shoes under the nickname "CryptoKicks."
NFTs may be used to represent digital collectibles in the same way physical card collections are represented, but digitally. On the NBA Top Shot platform, in February 2021, a LeBron slam dunk NFT card sold for $208,000.
How Does an NFT Marketplace Work?
Typically, all NFT websites follow the same procedure. To begin, a user must create an account on the website and download a digital wallet to hold their NFTs. After that, users may develop assets by uploading items to exhibit their work. The user may also choose which payment tokens to accept for their art and, if the platform suggests it, establish a fee.
The next step of the process consists of putting goods up for sale on the market. The user can place a fixed-price bid or participate in an auction. When a user lists an item for sale, a transaction is made to begin a personal trade smart contract for the user’s wallet. The platform may require collection moderation, and NFTs will be added to the list once they have been approved.
Step-by-Step NFT Marketplace Development
1. Budgeting: What Is The Cost Of Creating An NFT Marketplace
Everything, in general, depends on the required quantity of work, and the NFT marketplace development is no exception. As a result, if you choose to use a ready-made solution, the cost will be lower. The flow is the same to ensure the platform’s functionality. If your demands require a more complicated platform or if you need to create your own NFT, your NFT marketplace development expenses will rise.
A variety of blockchain development services offer access to the NFT marketplace. This competition allows you to benefit from development at a low cost. The minimum cost, however, is between $30,000 and $50,000. Furthermore, the cost of development is decided by the development services offered. Nevertheless, developing an NFT marketplace takes a long time.
Before creating your own marketplace, it is crucial to identify your goals and objectives. With such, you will be able to build an NFT system design that will be perfectly tailored to your needs. To simplify the task, we prepared a list of topics you should consider when creating a non-fungible token platform.
What Do You Specialize In?
A good starting point is to clearly position the niche you are going to work on. It is preferable to focus on a vertical market rather than a horizontal one to enhance your chances of success. Suppliers in the horizontal market sell everything to everyone, whereas vertical market providers focus on delivering services or goods that cater to a certain target market. Simply put, instead of attempting to sell a lot to many people, concentrate on a small number of items or services.
A good example is Sorare, which specializes in selling and buying football players’ trading cards in NFT form. Since its target audience consists of football lovers from all over the world, it encountered huge success and immense traffic. Finding your niche may be a great strategy to build or expand your audience.
What Is Your Monetization Model?
If you are wondering how to create an NFT marketplace, you should first know what monetization model you are going to implement in your platform. Here are some ideas.
Subscription Marketplace Monetization Model
The subscription monetization model is a well-packaged income strategy, and if the marketplace has enough traffic, the subscription model may be considered. Subscription fees are charged under this subscription arrangement. It might include monthly or annual costs for using the platform for a specified period. The subscription revenue model is not as frequently utilized as the commission monetization strategy in marketplaces.
Commission Monetization Model
The commission model is the most commonly and widely used model across all online marketplaces. It is also a popular choice among marketplace platforms. Because the commission model has demonstrated its ability to generate income, it has become a popular option. The commission model allows platform owners to charge fees to vendors for each successful transaction occurring through the platform. In other words, the store’s admin will capture value by collecting a portion of every sale occurring in the marketplace.
Freemium Listing Models
Freemium is a lesser-known monetization approach in which a marketplace platform offers both free and paid services. Simply put, the marketplace earns money by charging sellers a basic fee in return for premium services. The requirement to provide new services to consumers under a freemium listing model may appear difficult.
Lead Fee Revenue Model
The most common monetization strategy for service-based markets is the lead fee monetization model, in which consumers post a request and vendors pay the marketplace platform fees to win the bidding process. Simply put, the lead fee monetization model requires suppliers to pay a fee to the platform in order to compete for the client.
Product Listing Monetization Model
A listing fee is the best way to compensate sellers who are selling high-ticket products. While the commission-based revenue model only pays out if a sale is completed, it ignores income or fees from low-performing or less popular items. That is where the product listing model excels, as it allows for-profit on every ad or product posted on the marketplace platform.
What Makes Your Project Stand Out From The Rest?
One of your biggest challenges will be to make your target audience believe that you are exceptional. Gaining trust is the first step toward a successful project. Buyers must have faith in their team and in the community's ability to make the project a success as a whole. People who invest in a project demand vision from the founders and a defined plan, in addition to honesty about yourself. They won't stay involved in the project for long if you don't have this vision, and they won't buy a single NFT if you don't have it.
A social presence is required to generate awareness, exchange material, and engage with others. The most common method of NFT marketing is social media marketing, where people of various ages, professions, interests, and hobbies are targeted. Other marketing tools, such as e-mail marketing, social media ads, search engine optimization, or content marketing could also help reach success faster.
3. Which Protocol Tokens Are You Going To Use?
Protocol tokens are cryptographic tokens that are required to use the underlying protocol's service. There exist several types, which you will have to choose from when picking an NFT design, including:
- Binance Smart Chain (BSC)
4. Standards In The Blockchain
Tokens are digital currencies built on top of existing blockchains. Specific token standards have been developed to enable diverse blockchain use-cases.
Ethereum is the most popular blockchain token platform since the introduction of smart contracts. The name of a token standard's format is determined by the blockchain on which it is constructed. ERC-20 tokens, for example, are generated on the Ethereum network.
The ERC-721 standard was the first to represent non-fungible digital assets. Because ERC-721 is an inheritable Solidity smart contract standard, developers can use the OpenZeppelin library to construct new ERC-721-compliant contracts. ERC-721 includes fundamental techniques for monitoring the owner of a unique identifier and a permitted means for the owner to transfer the asset to others.
The ERC-1155 standard provides "semi-fungibility" and is a superset of the ERC-721 standard. Unlike ERC-721, where a unique ID represents a single asset, an ERC-1155 token's unique ID represents a class of assets with an extra quantity field to indicate how much of each class a wallet owns. Assets in the same class can be swapped out, and the user can transfer any number of assets to others.
Tron is an ideal decentralized blockchain network for large-scale or sophisticated corporate token creation. However, the basic operations of the Tron blockchain network are comparable to those of other blockchain networks, like Ethereum. Token creators may use the Tron blockchain network to construct scalable tokens that can adapt to changing business demands.
Flow is a decentralized, fast, developer-centric blockchain designed to promote the development of a whole new set of apps, games, and digital assets. The Flow blockchain has a multi-role design that emphasizes the inherent benefit of scalability without sharding. At the same time, Flow assists with the creation of new digital asset variations that can be traded on open marketplaces from anywhere in the globe. NFTs are supported by the FLOW blockchain, which employs a proof of stake consensus methodology. NBA Top Shot, for example, is run on the FLOW network. In the future, Cryptokitties intends to migrate from Ethereum to FLOW.
The Worldwide Asset eXchange (WAX), also known as the "King of NFTs," is the world's largest decentralized entertainment and video gaming network. The WAX blockchain technology aims to make NFTs more accessible and affordable. WAX uses a novel tokenomic approach to provide incentives for all WAX token holders in the community with the possibility of earning a passive income using the WAX Protocol Token (WAXP). In addition, the WAX blockchain provides easy development options for decentralized application creation and deployment.
Binance Smart Chain
Binance Smart Chain is the next upgrade to Binance Chain and will operate in parallel with it. It allows the development of smart contracts for tokens on the Binance blockchain, as well as an all-new BNB staking mechanism. It intends to substantially enhance the usefulness of both the Binance Chain and BNB. BSC offers an environment in which validators, token holders, developers, and consumers benefit from a rewarding blockchain that can offer high performances while still providing room for future advancements. Binance NFT marketplaces are among the most popular ones.
Solana's network, which combines the PoS consensus algorithm with its unique PoH system, is built with speed, security, and cost in mind. Because it consolidates transaction approvals into groups of nodes rather than each node running on its own computer, as in PoW blockchains like Bitcoin's, Solana's network uses considerably less energy than PoW blockchains. As a result, the network charges low transaction costs, which are presently inferior to $0.01 per transaction. Bitcoin, on the other hand, has a market capitalization of about $20.
Tezos is a proof-of-stake blockchain network that allows you to sell NFT art. The self-amending protocol was first introduced on this blockchain network. One of the most important components of the Tezos blockchain design is the network shell. The network shell serves as a connection point between the blockchain and the network protocol. The transaction protocol and consensus protocol are irrelevant to this shell. Protecting nodes from denial-of-service assaults is the most difficult aspect of the network shell.
Stellar is one of the most straightforward and effective open-source, decentralized, community-owned blockchain networks for facilitating cross-asset value transfers. Lumens is the native cryptocurrency of Stellar (XLM). However, on its own blockchain network, Stellar may support other tokenized assets.
NFT Marketplace Architecture
Without having to re-deploy the entire program, a microservice architecture application may be updated or fixed. The microservice architecture consists of several loosely linked and independently deployed components that work together to create an application. In a large application, if a single microservice goes down, it won't affect the other services.
We can scale the required services at any moment because they are separate and, using a smaller codebase, can be deployed much faster. Microservices make large-scale systems easier to implement and enable scalability, flexibility, and productivity. Microservice architecture is even used by the biggest companies, including Amazon, Netflix, and Uber.
5. What Features Do You Want To See There?
Creating an NFT, you should first identify what features you would like to add to your platform. There are several efficient features that you might want to consider adding to your NFT site.
Because the NFT marketplace allows for trading, the tokens are extremely liquid. The liquidity pool on the marketplace is accessible to token users.
The NFT marketplace website is simple to use, making it a welcoming environment for beginners.
When a new NFT project is established, the tokens for one blockchain can be exchanged for another, and wallet providers facilitate NFT trading.
Users looking for certain kinds of NFTs should be able to filter the offers list.
The decentralized nature of the blockchain implies the following functions in the e-commerce marketplace system:
- Nothing is kept centrally;
- All transaction data is copied and distributed over a network of computers;
- Whenever a new block is added to the blockchain, each computer on the network updates its blockchain to reflect the change;
- Only one copy of the information is kept in the event of a hack.
Crypto Wallet Integration
Because NFT payments are now made through cryptocurrencies, the NFT marketplace should include a safe and reliable crypto wallet integration mechanism.
The platform gives users a transparent picture of their transactions, resulting in high confidence in the network.
As previously stated, the smart contract and decentralized platform ensure that users’ transactions and related information are completely safe and secure.
6. Which Technological Stack Are You Going To Implement?
Once you've decided on all of the features you'd like to see in your NFT marketplace, it's time to decide on the tech stack you'll need to put the project into action. You'll have to decide on a blockchain platform, storage platform, front-end development framework, and the NFT standard that your marketplace supports.
Creating an NFT and choosing a relevant technological stack is quite complex. So, how to build a marketplace from scratch? Here are all the things related to the technology stack you definitely should pay attention to.
You must select where NFTs will be stored whenever you approach an NFT marketplace project. The IPFS hypermedia protocol or the decentralized Filecoin storage network will be perfect fits for this purpose. Pinata is another popular site for uploading and managing IPFS files. It offers NFTs safe and verified files.
ERC-721, ERC-1155, FA2, dGoods, and TRC-721 are the current NFT-supporting standards. Each of these comes with its own set of technological challenges, so you'll need to work with your development team to come up with a suitable solution.
You'll need a blockchain platform to run your NFT marketplace as it'll be the foundation. Because the transaction history and token information are publicly verifiable, Ethereum is the traditional choice of NFT platform developers, providing extra security to NFT transactions. NFT owners may easily transfer their tokens using the common back-end of all Ethereum-based NFT markets. NFT developers use Flow for its simple, user-friendly Cadence programming language to create digital assets, games, and apps. Tezos is another popular option since its FA2 NFT contracts are ideal for an NFT marketplace’s development goal.
Developers may easily design interactive user interfaces with React. Backward compatibility and component-centric applications are prioritized in the framework, ensuring your application's long-term viability. Its potential to be used for native development is one of its main features. Some of its other benefits include reusable components, improved speed, Facebook support, a huge development community, and SEO friendliness.
Nowadays, it's one of the most used front-end frameworks as it is both basic and easy. It excels at simplifying the complexity that Angular developers must deal with. It's lower in size and comes with two key benefits: a visual DOM and a component-based approach to user interface development. Vue is also a two-way binding ecology capable of handling both complex and basic activities.
7. Non-fungible Tokens Marketplace Back-end Example
You must design the marketplace's whole technological architecture, including how user profiles will be generated and maintained, where NFTs will be stored, and what payment methods will be linked to the system, among other things. You should have a clear project architecture in mind and a technological set of features for the continued development after this stage. Here is an example of the technological stack for the back-end NFT marketplace.
NFT Marketplace Back-end
Blockchain: Ethereum, Binance Smart Chain.
Token Standard: ERC721, ERC1155, BEP-721, BEP-1155.
Smart contracts: Ethereum Virtual Machine, BSC Virtual Machine.
Frameworks: Spring, Symfony, Flask.
Programming languages: Java, PHP, Python.
Databases SQL: MySQL, PostgreSQL, MariaDB, MS SQL, Oracle.
Databases NoSQL: MongoDB, Kassandra, DynamoDB.
Search engines: Apache Solr, Elasticsearch.
DevOps: GitLab CI, TeamCity, GoCD Jenkins, WS CodeBuild, Terraform.
Cache: Redis, Memcached.
8. Non-fungible Tokens Marketplace Front-end Example
Vue, Angular, and React are the most popular front-end development frameworks for the NFT marketplace. They're all basic and coder-friendly, with sleek, easy-to-navigate interfaces that provide rapid results. Here is an example of the technological stack for the front-end NFT marketplace.
After the back-end, it's time to focus on the front-end. You must develop a prototype, choose brand colors, make mockups of user pages, and finalize your product's design. Don't overlook this step, as the user interface is what your users will see. They won't stick with you if they don't like the aesthetic of your NFT marketplace or don't grasp how to navigate through it.
NFT Marketplace Front-end
Programming languages for web: Angular.JS, React.JS, and Vue.JS.
Programming languages for mobile: Java, Kotlin for Android, and Swift for iOS.
Architecture: MVVM for Android and MVC, MVP, MVVM, and VIPER for iOS.
IDE: Android Studio and Xcode for iOS.
SDK: Android SDK and iOS SDK.
This is an important step that should never be skipped. Finding and resolving problems as soon as possible guarantees that your product is ready to go. Software testing also ensures that your platform performs as planned and satisfies the project's original criteria. Remember that a software solution that has been thoroughly tested delivers reliability, security, and excellent performance.
10. Security Audit
In 2021, graphic artists, musicians, and even the NBA released their own non-fungible tokens. NFT functions on smart contracts, which leads to the need for a security audit. You can actually lose your NFT if a security flaw occurs. The smart contract auditing processes described above can be used here but must be modified to replicate NFT payment and transfer. When assets are transferred across borders, auditors can also advise on regulatory compliance. As more nations impose taxes on the purchase and sale of cryptocurrencies and crypto-related assets, regulatory guidance will become more important.
11. Marketplace Launch And Support
The launch of an NFT marketplace is a work of art itself. You may start your NFT project right now or spread it out across numerous iterations first. Continuous integration is another approach that is less user-friendly but technically easier. Consult your developers to determine which option is best for your project. However, the effort of the development team does not cease with the launch. You may require assistance and maintenance whenever additional users join the platform and add new NFTs. Regular updates and the integration of new features are also required by the NFT marketplace, which is ongoing work on the seamless running of your project.
Off-the-shelf Tools Vs. Custom NFT Marketplace Development
So, how do you make an NFT marketplace? You have two options. For the creation of the NFT marketplace, you may utilize ready-made tools or involve a custom NFT marketplace development team.
Off-the-shelf software comprises pre-built programs and tools that may be integrated into your company's system, but it does not have the unique functionality that your organization might require. These applications cater to a wider population with comparable demands but will not provide effective solutions for specific user groups. Developers employ previously existing processes and do not construct apps from scratch, making off-the-shelf alternatives ideal for those on a budget. Furthermore, you will profit from a faster time-to-market.
We must highlight the SDK provided by OpenSea as an example of such solutions. You'll obtain an NFT marketplace and your own design using OpenSea's infrastructure. Perhaps you need to create a custom back-end for your game and need people to be able to arrange trades server-side, or perhaps you need users to be able to create auctions in a deep section of gameplay. Developers may use the SDK to create their own marketplaces from the ground up and incorporate it more deeply into the game.
Custom NFT Marketplace Development
It's no secret that developing a custom product takes a long time. However, the main idea is to keep each layer tailored to your company's particular requirements. Programmers create NFT marketplace development solutions tailored to your company’s goals from the ground up. Such software is created with the infrastructure, implementation needs, branding, and all the other elements of the organization in mind, so it will only function for that organization. Indeed, the most useful approach for building your own blockchain and developing an NFT app is custom development.
How To Make An NFT Marketplace With Platform For Development Vs. How To Create An NFT With Custom Development
|Quick to market||Unlimited options ultimately provide an evolving solution that can be updated according to your business needs|
|Quick to deploy||No additional licensing fees|
|Feature-rich||Possible competitive advantage|
|Lower up-front cost||You can start with the core essentials and add features and functions at any point|
|May meet most of your business needs||A solution tailored to match your business needs, processes, and security requirements|
|User communities across the internet and forums provide self-help support||Direct vendor support|
|No fully-controlled investment in updates and enhancements|
|You own the software|
|Possible integration with legacy and third-party systems|
All in all, we would like to point out that the NFT markets represent an excellent and profitable market for all designers, crypto fans, and business owners. We only encourage you to be focused, make educated judgments, and be consistent, since any new platform, and designers in particular, may take time to succeed.
After establishing how to make your own NFT marketplace and considering all the details regarding the mapping of goals, networks, protocols and standards, budgeting, benefits and key features, the necessary technology stack on how to create a marketplace, testing, launch and maintenance, the most valuable aspects of the development process, and much more, it should be much easier to make decisions.