In the world of NFTs, allowlists are a fairly straightforward concept but to really make sense of allowlists, we first have to turn our attention to the ‘gas fee’ issue. What is a gas fee I hear you ask? It’s the name given to transaction fees in the NFT space. They exist as a sort of compensation for the computational energy required to carry out transactions on the blockchain. It’s similar to the processing fees that certain credit cards charge when used to send money or pay bills.
To break it down a bit further, it’s important to note that every transaction adds a new block to the chain. Ethereum uses a proof-of-work mining model which is achieved by ‘miners’ who use special computer processes to solve cryptographic problems. Once a solution is found, sets of transactions are then processed and added to the blockchain, and the miners who solve these cryptographic problems are then compensated for their time. This compensation acts as an incentive for miners which directly influences the gas fee associated with transactions.
Gas fees impact artists when they create NFTs and sell them; they also impact buyers who want to get their hands on NFTs. When an upcoming NFT collection receives a lot of interest, collectors compete to get their hands on an NFT before the supply runs dry and the NFT hits the resell market - the network gets very busy, and gas fees go up.
Think of gas in the same way you would when thinking of fuel in a car, you can’t drive without fuel (you too electric cars) and you can’t process transactions on the blockchain without gas. It’s a resource-intensive process that ultimately operates on a supply and demand basis. This had led to a massive fluctuation in gas prices with instances where the gas price in a particular transaction exceeds the price of the NFT itself. If you want your transaction to be completed faster, this will likely involve additional gas fees. Pretty crazy stuff.
This has proven to be a hurdle for new buyers in the NFT market who struggle with the high prices. The high gas prices make it difficult to create and sell meaning some sellers may end up losing money on transactions if the value of their NFT is less than the gas prices. Buyers are also at the mercy of gas prices as almost every action involving the blockchain requires gas.
Allowlists help to circumvent the so-called ‘gas war’ that buyers and sellers find themselves stuck in. When an upcoming NFT collection receives a lot of hype, collectors compete to get their hands on an NFT before the supply runs dry and the NFT hits the resell market. Artists can create an allowlist consisting of their most loyal supporters by ensuring a crypto wallet address will be pre-approved for NFT pre-sales.
Adding wallets to your collection’s pre-sale access is very simple. You have 2 options:
Once you have added the wallets with pre-sale access to your list, you can go ahead and save your changes. You can always come back and edit the list later - keep in mind it can sometimes take some time for our servers to actually enable a new list of wallets with pre-sale access; we recommend having your full list ready at least 3 hours before a mint (although it should, generally, be fine if you update it a bit later than that).
Now you know what an allowlist is, you might be wondering how to go about getting a spot. One great way of getting an allowlist spot is by owning an NFT from a previous collection, acting as a sort of launchpad. NFT Alpha Groups - small, tightly-knit Discord servers - are another great way of being added to allowlists as well as being an active, engaged member within an NFT community. There are more conventional ways of landing yourself on an allowlist such as raffles, giveaways, and creating fan art which help to enhance NFT communities.
To conclude, an allowlist takes the pressure off by guaranteeing your place, meaning you can mint your nft when gas is low.
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