The battle for NFT market share is heating up, with Coinbase betting that Mastercard-powered fiat on-ramps can give it an edge over rivals such as OpenSea and Rarible.
On Jan. 18, Mastercard revealed it will team up with Coinbase on its forthcoming NFT marketplace to enable accountholders to purchase nonfungible tokens using fiat currencies.
“Buying digital goods should be as simple as buying a T-shirt or coffee pods on an e-commerce site,” Mastercard said in a statement.
“That’s not the case for many NFTs, or non-fungible tokens.Today, if you want to buy an NFT — such as a digital art piece — you first need to open a crypto wallet, buy crypto, then use it to purchase an NFT in an online marketplace. Cryptocurrency enthusiasts are used to this process. But for most people, it’s not simple.”
In a Jan. 19 blog post, Coinbase said it is working with Mastercard to classify NFTs as “digital goods” The classification would enable the firm to process fiat payments associated with NFT transactions. Coinbase first announced it is building an NFT marketplace in October.
The news comes amid surging activity in the NFT markets, with leading marketplace OpenSea representing 18% of all Ether burn through transaction fees over the past 24 hours.
OpenSea has already tagged a new record for monthly trade volume over just the first 19 days of January, with nearly $3.9B worth of NFTs changing hands this month already according to Dune Analytics.
The number of monthly active trailers is also at record highs, with nearly 400,000 unique users transacting on the platform in less than three weeks. The data suggests an average per-capita trade volume of $9,700 during 2022 so far.
Google search volumes for the ‘NFT’ has also been surging, with the search term now attracting more traffic than queries for ‘crypto’, ‘Ethereum’, and ‘blockchain’.
Mastercard expressed its optimism for the growth of nonfungible tokens, highlighting that the use-cases or NFT go “beyond art and collectibles.”