On November 17, 2020, the popular NFT marketplace, Rarible, introduced bidding. This exciting development now allows NFT holders to receive offers and accept them if they so wish. For buyers, Rarible bidding allows finding underperforming NFTs and snagging a potential bargain.
While bidding is a great addition to the Rarible platform, the process can be a little overwhelming if improperly understood. To make bidding on Rarible as easy as possible, here is a quick explanation and guide.
What is Rarible?
Launched in early 2020, Rarible is a platform to create, buy and sell digital collectibles.
These collectibles are otherwise known as NFTs, short for non-fungible tokens. These can be anything from a photograph, some original artwork to a digital collectible card.
Rarible has a particular focus on NFT art assets. One of Rarible’s key features is the ability to give previews of content in the forms of previews, trailers, or snippets while locking away the full content for a buyer.
The platform is almost entirely autonomous thanks to its ERC-20 governance token, RARI. Holders of RARI are bestowed with voting rights on the platform’s development, what art is featured, and how NFTs are curated.
What is Rarible Bidding
Up until November 2020, NFTs on the Rarible platform were sold through a price-point model.
The creator or holder of an NFT would list it on the marketplace and decide what amount of ETH they wanted in return for it. Browsers could then decide whether or not that price suited them and purchase or decline accordingly. This is a little like shopping on Amazon, where the price is non-negotiable.
Now, with bidding, the system has evolved. Bidding is best understood as sending an offer to an NFT holder, akin to eBay’s “Best Offer” system.
Under the new bidding system, browsers of the Rarible marketplace offer an amount they’d be willing to pay for the NFT.
Buyers can impose a reserve and a minimum bid amount on their pieces to exclude extremely low-ball offers.
After placing a bid, the seller has a limited amount of time to accept or reject the offer.
For sellers, accepting a bid is a two-step process. Firstly, you will be informed that a small portion of the sale (2.5%) will be taken by Rarible as a commission. After confirming this, the seller will then be asked to pay the variable gas fee.
You will need to ensure you have enough funds in your wallet to cover these fees.
Because Rarible uses the Ethereum blockchain, gas fees are unfortunately unavoidable. Until Ethereum changes to the proof-of-stake protocol, these fees are simply part of transacting NFTs.
Therefore, it is advised to set a minimum bid price that covers the expected cost of gas.
How to Bid on Rarible
Due to the infancy of NFT and blockchain technology, the process can seem a little daunting. However, bidding on Rarible is relatively simple.
Here are some step by step instructions that should clear things up:
1. Create a Metamask Wallet
First things first, if you don’t already, you’ll want to create a MetaMask wallet.
This involves downloading a browser extension from here.
Once installed, you’ll notice its logo in the upper-right of your browser or within your extensions panel. Clicking on this will ask you to agree to the terms and conditions.
After setting a password, MetaMask will create your digital wallet.
To recover this wallet, you’ll need to enter your seed words if you ever forget your password. MetaMask will ask you to download a file with these 12 words in it.
For added security, it’s best to write these words on a piece of paper and keep it somewhere physically secure, such as a safe. Delete the file after.
2. Link Metamask to Rarible
Once set up, you’ll need to integrate MetaMask with Rarible.
This is as simple as clicking “Connect Wallet” in the top right. Rarible will then automatically detect the MetaMask extension.
Simply click “approve” if asked.
3. Browse the marketplace
Now it’s up to you. Go to the Rarible marketplace and get looking for artwork that you like.
If you have something particular in mind, use the search bar and the filters to hone in your search.
4. Ensure wallet is funded
Once you’ve found an NFT you simply must have, it’s time to strike while the iron’s hot.
Firstly, you’ll need to make sure your wallet is adequately funded.
Click your MetaMask icon and press “Add Funds.”
Remember, Ethereum transactions cost “gas,” so make sure you top your wallet up enough to cover that as well.
5. Place a bid
Next, press “Place Bid” and enter your offer.
While canceling a bid is possible by contacting the seller, there is no guarantee. For this reason, only bid on items you want and only bid amounts you’re willing to pay.
As a buyer, you now wait.
The seller will either accept or reject your offer. If accepted, you will receive a notification in Metamask.
One of the most important aspects to understand when it comes to Rarible bidding is gas fees.
As a seller, you’ll want to ensure the minimum bid on your NFTs cover the gas fees. An estimate of these will be shown in Metamask, with the ability to choose the speed at which the transaction should be completed.
These fees involve the converting of ETH to wrapped ETH (wETH) that Rarible uses as well as the updating of the public ledger.
You’ll want to ensure your wallet is sufficiently funded to cover these fees prior to accepting the offer.