NFT Marketplace Development; Tips for Founders – Crypto Business Show Episode 12
Video Transcript:
Rob: Welcome everybody to the crypto business podcast brought to you by TokenMinds. I’m your host Rob Eijgenraam, director at TokenMinds, a full-service crypto, and nft agency. In this podcast, we’re discussing any blockchain topic that is relevant for companies and founders. Today we’re going to talk about nft marketplace development, and what founders need to take into account, in this podcast with me is Josh, a veteran blockchain development manager, and we are going to discuss why you need your own marketplace, something about the development process and what to take into account for the smart contract function. So Josh let’s start with the first point, why do founders need their own nft marketplace?
Josh: First of all thank you very much Rob for having me again here on this podcast. So nfts are everywhere right, but not everyone has their own nft marketplace, and there is a lot of conservation that you need to do before you decide to do, right, why should you have your own marketplace? For several reasons, first of all, you can save and earn from the transaction fees. Marketplaces like opensea and rarible for example charge around 2.5 percent of every transaction they make, so if you have your own nft marketplace, you can adjust this in your smart contract, and instead of these third-party marketplaces starting from this piece, you can add them to your own sales and profit. So that’s one of the first reasons. The second reason would be marketing, marketing-wise, having your own nft marketplace where you can sell your own collection. It’s a good way to market your existing nft collection or projects, so this makes your project look more legitimate and trustworthy. Lastly, I think the reason that you also need to build your own nft marketplace is to make sure you have good security in terms of selling. So you can make sure this smart contract is secure and bug-free because you own them. You can actually hire third-party companies to audit the smart contract that you built, this stems from the recent issues with opensea having bugs that are being exposed, resulting to the loss of hundred maybe hundreds of thousands in USD from nft collectors because there are bugs in the smart contract. So if you want to decide on building your own marketplace you need to consider these points
Rob: All right thank you Josh makes sense, and what can you tell us about the development process for nft marketplaces?
Josh: In terms of development the nft marketplaces are pretty similar in terms of look and how it is being developed to e-commerce sites, so basically you have a place where you can buy and sell nfs in e-commerce, it’s the same, and however the difference is that instead of a regular option back-end, you have a smart contract. So there are several steps the first one is of course you need to determine the blockchain where you’re going to build this particular nft marketplace. Most of the time it’s on Ethereum can be on Solana and other new popular blockchains, and then the next step would be creating the design so you can base your design on existing nft marketplaces like opensea and rarible. You can get inspiration from that but you will need a designer to build that for you. The next step would be building the smart contract, so if you have the details on what you want to do with your particular nft marketplace, you have to develop a smart contract based on those specifications. So in this smart contract, you need to be able to buy the item, cancel the listing, etc., and fourth you need to build your front-end design. So from the design that was done by the designer, this can be built on popular tech stacks like react.js, and vue.js, it depends on your choice in terms of technology, but most of the time we build it on react.js because it has the more mature libraries in terms of integrating to web3, so if you have the front end you have a smart contract, you need to integrate this two together, that way the front end will be able to communicate and transact with a smart contract using web3 wallets like metamask. Of course, after doing the integration you need a lot of testing, smart contracts are a very delicate type of back end because if you deploy it, it’s actually immutable, so you have to make sure that everything is okay before you deploy it. Lastly, when everything is done, you need to deploy the main net and pay for the relevant gas fees, depending on how optimized your smart contract is built. So yeah that’s the other process in building, it’s more of a high level, right it’s the high-level process of building your own market.
Rob: Yeah absolutely there are a lot of things we can go deep dive into here, but maybe for future podcasts. For now, let’s just discuss a little bit about the functions of the smart contract, and what to take into account there.
Josh: So for nft marketplace smart contracts, you need to have a few important functions, of course, you need to have a function to buy the item, cancel the listing, set up the royalty fees, and transaction fees, and of course withdraw funds, and also one of the important functions to be able to pause and unpause a specific marketplace smart contract because sometimes there are some business decisions that need to be made, where you have to pause it for the meantime and maybe in the future and pause it. So those are the six functions that you would want to have in your nft marketplace smart contract.
Rob: Okay, well thank you so much, Josh, really appreciate all the input. I think this is very helpful for companies and founders alike, and I’m sure we’re gonna talk again at some point about any of the specifics here. In the meantime thanks everybody for listening and watching and see you next time, bye.
Josh: Thank you.