The Non-fungible token (NFT) market has been a buzzword for a while now, providing new ways for digital artists and creators to gain exposure and sell digital collectibles securely. If you’re keen to monetize your art but still struggle to decide if Rarible is a good NFT marketplace, or if OpenSea is a better alternative, here is everything you need to know.
In this guide, you’ll also find out what all the fuss is about the RARI token. We will also be deciphering how the Rarible platform works, its history, and the future transitions to a Decentralized Autonomous Organization (As an open sourced blockchain ledger, Decentralized Autonomous Organization (DAO) is determined by a clear set of rules ...).
What Is an NFT?
An NFT is a token residing on a blockchain representing (or pointing to) some data, like an image or video. For example, a Bitcoin is fungible. You can trade one Bitcoin for another Bitcoin. But trading an artwork like the “Mona Lisa” for another identical painting is impossible because it is unique.
Since NFTs are a part of the Ethereum blockchain, any NFT can be easily tracked. That means buyers or sellers can verify the authenticity, history, and ownership of any digital collectible. In more detail, NFTs are generally smart contracts, usually, ERC-721, with which people interact.
What Is Rarible?
Rarible is an NFT community-owned marketplace, issuance platform and distributed network, a first of its kind built on the Ethereum blockchain.
NFTs — also referred to as crypto-collectibles — allow for a digital certificate of authenticity This makes Rarible revolutionary because it represents a new kind of ownership for digital files such as images, music, videos and documents.
Since NFTs are a form of liquid intellectual property, these digital collectibles are often themselves unique, available as limited quantity traceable assets, mainly to prevent the circulation of counterfeits. That’s precisely why NFT is gaining popularity and how “Beeple” artwork can be sold for over $60 million. Rarible is being used by artists, digital creators, and collectors.
How Does Rarible Work?
Digital artists and creators employ the Rarible software platform to issue ERC-721 and ERC-1155 NFTs to represent the ownership of their digital artwork secured with blockchain. To fully utilize Rarible, users must own Ethereum (ETH) tokens and connect their wallets, for example, MetaMask and WalletLink, to connect to Rarible’s minting service, similar to OpenSea or Mintable. Once this is done, they alone can create their unique NFTs.
Typically, NFTs are issued without the need for any coding skills. But once they are issued, they can be sold or traded publicly without an intermediary on the Rarible platform.
That also means anyone can easily set up an account on Rarible to perform these transactions. The only thing you need to keep in mind is to make sure the seller on the Rarible network is legitimate.
Royalties in Rarible
Digital creators can also program royalties, which are the rights to future cash flows within NFTs. By using smart contracts when setting a percentage of future sales, you can receive the returns automatically by issuing a token.
This is especially true since NFTs can be designed to pay out royalties immediately. For example, if a piece is set to a 9% royalty, the creator receives 9% of any subsequent sale of that art.
New Features on Rarible
The latest addition to this platform is the NFT market index. The index is derived from the value of the token’s Circulating supply is the number of cryptocurrencies or tokens that are publicly available and circulating in the crypto.... It can track and show the performance and development of the token within the NFT industry. This is especially helpful for investors hesitant about which artworks to choose.
Another exciting feature of the Rarible network is its merger with the DeFi ecosystem, the purpose of which is to encourage the issuance of insurance employing digital tokens by joining with the yInsure project at Yearn Finance.
The History of Rarible
The Rarible platform was first conceived in 2017 and officially launched in early 2020. The founders are two Russian developers, Alexei Falin and Alex Salnikov. A team of 12 people supports them, primarily artists. Alexei Falin was a full-stack developer with several years of experience and is currently Rarible’s CEO. He also co-founded Sticker.Place, a software company that mediates between artists and consumers who want to buy stickers. It was this emphasis on tokenizing collectibles which gave rise to Rarible.
Although Alex Salnikov is a renowned financial professional and market strategist, he was also the co-founder with Ivan Starinin in 2014 of MarginCall, at the time the most technologically advanced exchange. He also participated in Humaniq, a well-known blockchain application for the unbanked population. Rarible is backed by various investors, including CoinFund, a blockchain investment company in New York. According to DappRadar, the Rarible marketplace is bustling with over 50,000 users and over $140 million in trading volume.
What Are RARI Token and DAO?
Rarible aims to become a DAO, a software-based system controlled by its users and empowered by the blockchain. A DAO uses blockchain technology such as programs and code to ensure transparency and decentralization over the platform. Thus, a key component is governance.
That is where RARI comes in, as the Rarible governance token by which the Rarible DAO can influence decisions and incentivize any participation.
The Rarible DAO can be defined as the organization in which all decision-making rests with the platform’s users. The RARI token given to the active users acts as a governance instrument, enabling collectors and creators to vote on multiple upgrades and decide how the platform should evolve.
This makes the governance of the Rarible platform directly dependent on its most active users, and further positions Rarible as a public good operated by its community.
The Purpose of RARI Token
RARI is also being used to acquire marketplace users and incentivize NFT traders within the platform. This is called marketplace liquidity mining. Users earn RARI tokens by buying or selling on the Rarible marketplace, since the objective is to give autonomy to the Rarible DAO.
In addition, the RARI distribution mechanism incentivizes users to list their NFTs on the Rarible platform itself.
However, the main goal of a DAO is to ensure that the platform’s users are in charge of making all decisions. In the case of Rarible, the RARI governance token is the basis. In this sense, RARI token holders will shape the future of the Rarible in the NFT space.
The Benefits of RARI Token
RARI tokens give their holders various rights, such as allowing for community voting by which holders of RARI can submit and vote on proposals and participate in curation and moderation. Voting with RARI is non-binding and advisory at the moment (the transition to a DAO will correct this), meaning that Rarible as a company currently reviews its users’ suggestions before making its own decisions and final implementations.
Is the RARI Token Worth Anything?
RARI token was launched in July 2020. The price has fluctuated between $10 and $13, despite the all-time high of $40 with an average 24-hour trading volume of $4 million. Currently, there’s a max supply of 25 million, while 24.8 million of them are already circulating in the market.
Approximately 30% of the tokens are distributed to the Rarible team and investors, 10% is air-dropped to Rarible users and NFT owners, whereas the remaining 60% (marketplace liquidity mining) is given away over 200 weeks to buyers and sellers (50/50) on the Rarible platform. Every Sunday, 75,000 tokens are released.
Rarible vs. OpenSea: Which is Better?
Item listing and transaction fees for creators are cheaper in OpenSea. With OpenSea, you must mint NFTs only when selling items, meaning you first list and offer your art. With Rarible, you are required to mint before the sale. This is the reason why you are required to pay a higher fee just for listing your art in Rarible.
Minting fees are always needed for both platforms since tokens must be minted to come onto the blockchain. But with Rarible, you need to pay these fees even if your art is never sold.
However, since Rarible is a closed and smaller community and has fewer users, you can more easily track your artwork, compared to OpenSea. The main difference between these two platforms is that OpenSea does not yet have a unique platform token, like the RARI, that could gain value over time.
Is Rarible Safe?
In short, yes.
The collectibles are secured with blockchain, and the users on the platform are authentic and legitimate. To complete a registration on Rarible, a user must submit a legitimate backstage photo proof to verify their authenticity. But for additional security, users must verify and link their Twitter account to the platform before they’re allowed to start listing and buying collectibles on Rarible.
It should be noted that Rarible was once delisted in July 2020 due to wash trading activities. This basically means that some brokers were buying digital assets from Rarible and reselling them through another broker illegally. Since then, Rarible has been actively locating and blacklisting these traders on the platform in order to ensure a transparent marketplace.
The Bottom Line
Rarible is one of the most popular NFT marketplaces emerging in 2020. It has been designated as the first community-owned NFT marketplace, with its native ERC-20 RARI token. Rarible’s first-mover advantage in the Decentralized Finance (DeFi) takes the decentralized concept of blockchain and applies it to the world of finance. Build... NFT sub-niche is the right choice, given that its ability to innovate has been demonstrated with its announced DeFi NFTs, fractional NFT ownership, and indexes.
However, its technology needs to evolve to allow a fully interoperable marketplace, such as cross-chain NFT transactions among multiple blockchains.