In a Tuesday blog post, Coinbase vice president of product and ecosystem Sanchan Saxena said the nonfungible token, or NFT, marketplace would allow its users to mint, purchase, discover and showcase Ethereum-based tokens. According to Saxena, the offering will allow creators to maintain control of their artwork “through decentralized contracts and metadata transparency,” with all NFTs on-chain.
The Coinbase announcement comes following crypto exchange FTX and its United States-based subsidiary introducing a marketplace wherein users are able to trade NFTs cross-chain through the Ethereum and Solana blockchains. Binance, the world’s largest crypto exchange, entered the NFT market in June by launching a marketplace aimed at minimizing transaction costs.
With 68 million verified users and 8.8 million monthly active users as of Q2 2021, Coinbase’s entry into the NFT industry could provide competition for established marketplaces like OpenSea and Rarible. OpenSea’s head of product Nate Chastain is facing criticism for using burner wallets to purchase NFTs on the platform so that the artwork could receive more attention on the website’s front page. The platform mainly uses Ethereum, which dominates sales in the NFT market.
According to data from DappRadar, the total transaction volume on OpenSea was $8.7 billion at the time of publication, making it the largest of the NFT marketplaces. NFT sales through the Pokemon-inspired Axie Infinity game came in second at $2.5 billion.