For months now, NFT collectors have been chafing at a raft of issues bedeviling OpenSea’s platform, from high gas fees to its inability to let buyers bid on collections and multiple pieces instead of just individual images.
Now the NFT marketplace is finally doing something about it. OpenSea, which has almost 20,000 users and handles $17M in daily sales volume, has migrated its operations onto a new protocol called Seaport. The shift promises to streamline the user experience on the marketplace and provide features rivals such as LooksRare are already offering.
Reduced Gas Fees
The big headline: OpenSea estimates the new protocol will reduce gas fees by 35%. “Based on last year’s data, that would amount to more than $460M in total savings,” the company said.
OpenSea first unveiled Seaport on May 20. Its core smart contract is open-sourced, meaning that “all builders, creators, and collectors of NFTs” can use the protocol.
“OpenSea does not control or operate the Seaport protocol — we will be just one, among many, building on top of this shared protocol,” the company said. Seaport was audited by OpenZeppelin and Trail of Bits.
The move to Seaport will remove the setup fee users previously had to pay to use the platform, which will contribute roughly one-quarter of the new protocol’s gas savings. The costs associated with purchasing NFTs with Ether and accepting offers in Wrapped ETH have also been reduced by more than one-third.
Reduced Transaction Fees
Users will first need to approve collections to enjoy reduced transaction fees for NFT transfers and sales, however OpenSea states the approval is a one-time cost per collection.
Seaport also enables new features for OpenSea, including allowing users to make offers on all NFTs contained within a collection, and all NFTs categorized by a specific trait that are ranked among the top 100 by monthly volume. In future, OpenSea will also launch features enabling users to purchase multiple NFTs in a single transaction, and allows creators to payout to multiple addresses.
OpenSea has been the single-largest driver of transaction fees since August 2021, when EIP-1559 introduced Ethereum’s burn mechanism which destroys base transaction fees.
According to data from Ultra Sound Money, OpenSea has destroyed 239,049 ETH since last August, representing nearly 9.5% of all Ether burnt. OpenSea is closely followed by token transfers with 227,038.5 ETH burned, and beats out third-ranked Uniswap v2 by 72%.
While the data suggests OpenSea’s upgrade could lead to a 3.3% reduction in the sum of Ether burned, a representative of Ultra Sound Money told The Defiant they expect Seaport will drive an increase in fee volume.
“Every reduction in per-transaction fees leads to more transactions,” said the rep. “This is known as induced demand. Looking back historically, we observe that as Ethereum scales (e.g. from 3M gas per block to 15M gas per block) the induced demand more than compensates for per-transaction fee reductions, i.e. that fee volume grows with scalability.”