Binance Plans to Launch its NFT Marketplace

The world’s largest cryptocurrency exchange by trading volumes Binance decided to introduce its own marketplace where users can create, buy, as well as sell digital collector’s items known as NFTs. Nonfungible tokens (NFTs) belong to a type of digital asset. NFTs are designed to represent ownership of rare virtual items, and such items could be anything from works of art to sports trading cards.

According to NonFungible.com, total sales of such tokens jumped to more than $2 billion in the first quarter. That figure doesn’t even account for the record-breaking $69 million NFT sold by Mike Winkelmann.

Binance plans to operate two markets. The first one would be a premium venue for top auctions as well as exhibitions. The cryptocurrency exchange also plans to operate a standard trading market that anyone can use to mint new tokens.

The premium segment would take a 10% cut from the proceeds of main auctions, with 90% going to artists. Another market will charge a 1% processing fee while creators will continuously receive a 1% royalty.

Binance and a new market

Binance’s NFT marketplace is set to debut this summer. The main cryptocurrency exchange launched a landing page that will let artists contact the firm about potential partnerships. The company’s goal is to create the best NFT trading platform in the world. Binance wants to create an NFT marketplace that would incorporate the best minting, buying as well as exchanging experience.

This step marks a challenge to Gemini, as it also operates its own NFT marketplace, Nifty Gateway. It hosted auctions from big names like Eminem as well as Grimes. It would also create an additional source of income for Binance. The world’s largest cryptocurrency exchange  benefited from the surging interest in bitcoin and other cryptocurrencies.

Coinbase is another main cryptocurrency exchange, and it went public on the Nasdaq this month. Like, Binance, Coinbase benefited from surging cryptocurrency prices. The price of bitcoin reached an all-time high of nearly $65,000 ahead of Coinbase’s debut.

There are certain risk factors as well, when it comes to the NFT boom. Some people even compared the NFT boom to the rise of initial coin offerings, or ICO’s in late 2017 and early 2018. In many countries, there are little to no government regulations of ICOs, meaning investors don’t have the protections that they enjoy with other assets. The ICO boom led to several scams and many projects were ultimately abandoned.