The true cost of uploading your NFT project to a marketplace
0x4918
December 6th, 2021

Disclaimer: This article is not calling out any particular NFT marketplace. Marketplaces that allow upload-minting like OpenSea, Rarible, and Foundation have made NFTs more accessible for artists and are without question, a net-positive for crypto in general.

That being said, it is often overlooked that uploading your content to these marketplaces comes at a cost in terms of ownership, control, and centralization of your project.

In this article, I will use OpenSea as the example, only because I don’t want to confuse each marketplace’s processes, but the takeaway is the same across the board.

1. You don’t own your project token.

When you upload an image on a marketplace like OpenSea, you do not own your project token. In fact, all NFTs uploaded to OpenSea are added as a new token to OpenSeas OpenSea Shared Storefront contract.

You can view the OpenSea contract here. One thing to especially note here is the OpenSeas massive contract is not validated. So no one knows what is going on inside that contract - you just have to trust them. No transparency into such a focal smart contract is not a good look, period.

2. You limit your community options

Convenience comes at a cost. Using a marketplace contract means that any of the marks of a true NFT project community are no longer present - no whitelisting, no timed reveal, no mint fees.

The hallmarks of some bigger projects like whitelisting, while sometimes not a beneficial experience, are still critical to building an audience over time. The build-up to the mint day and reveal are all things that help build buzz around a project - and when you direct upload to a marketplace - you lose all of this.

Let’s say you also want to airdrop future items to current holders - trying to determine who owns your collection will be very difficult where you will have to interface with OpenSeas API, which is very rate-limited and often non-informative. If you owned your contract you could just ask the contract “Who owns token #2, #30….#10000”.

A big loss is that your minting process is now non-existent. All uploaded images are static and buyers can pick and choose which NFT they want from your collection - no surprise drop or reveal. This means most items in your collection will go unclaimed.

The additional downside of no-minting process is that your cannot collect a mint fee either - this usually funds future project iterations for big projects that are building a community.

3. Your image and metadata is hosted on a centralized server

This con is again, at the cost of convenience. If we look at the API response for an item that was direct uploaded to OpenSea - for example, this project:

We can see here by looking up the item via the OpenSea API

We see we get a JSON response like this

"token_id": "330626650...497",
"num_sales": 0,
"image_url":"https://storage.opensea.io/files/e4eaf2782...88495d0.svg",
"image_preview_url": "https://lh3.googleusercontent.com/GF...3KS3MM-=s250",
"image_thumbnail_url":"https://lh3.googleusercontent.com/GF...S3MM-=s128",

Given that the URL here is storage.opensea.io and OpenSea uses Google Cloud Storage to save its thumbnails - we can rightfully assume that OpenSeas storage.opensea.io URL is just a wrapper for resolving images to their Google Cloud Storage bucket - where your NFT is stored.

If your NFT is ever deleted or removed from the bucket - you can say goodbye to your NFT because its now as good as gone. All that will be left is someone holding the OpenStoreFront token.

4. You are vendor-locking your project

OpenSea and other platforms have benefits to uploading directly to their marketplace. With OpenSea that is gasless transfer and trading. While this is an amazing benefit -you wind up vendor locking your NFT. Trying to sell your NFT across platforms is not possible. For example, you cannot sell an OpenSea NFT on Rarible and still utilize the benefits of the OpenSea platform.

To be more clear, if you own an NFT that was minted on Rarible - it will show in your OpenSea profile, but when someone tries to bid on that NFT it will direct them to Rarible.

If you had this item on a custom contract it is platform agnostic and can be listed anywhere.

5. No bulk uploading for large projects

Lastly, if you have a 10K NFT project there is no reasonable and easy way to upload all 10,000 to a marketplace and still retain your sanity. You can only upload one by one and set the metadata (name, description, traits) manually.

So if you have a project more than the upper limit of how much time you have to waste uploading items to OpenSea - you will need a custom smart contract.

Conclusions

Is uploading your NFT to a marketplace a bad idea? No, not at all. It is just important as an artist and community-builder that you know the risks of uploading directly to a marketplace and the limitation of doing so.

If you want to have all the benefits of marketplace trading and own your whole project you should use a service like Rampp.xyz - where you own your smart contract, your data is decentralized, and you can really build a community NFT project without writing a single line of code.

Arweave TX
eiepDSFW7twPzoOvx2ivVeItJc9_xCxAhR-BwitxB98
Ethereum Address
0x4918CE2770326888D535aBd73dD54D7aEeA31cF8
Content Digest
wn6qUqKQJvQ3wmPuW79wKpLkGZ851eU53D7Gz1UqfPw