When first dipping your toe into the world of non-fungible tokens (NFTs), it’s great to discover there are a variety of different marketplaces available to sell your creations. By using blockchain technology, NFTs provide artists a highly secure way to sell their digital art while establishing ownership and provenance in a way that even physical artwork cannot.
One of the biggest hurdles for crypto-artists to get their artwork out there is understanding the fees involved on the various platforms. For those unfamiliar with cryptocurrencies and the terminology involved, the whole process can seem quite daunting.
To help understand the hidden costs of selling NFT art, we will be looking at five different platforms and their fees. First, though, it’s essential to understand a bit about Ethereum and the costs of using the currency.
Ethereum and Gas Fees
Almost all NFTs rely on the Ethereum blockchain to validate transactions. When asking “how much does it cost to sell NFT art?” most people want a simple answer.
Unfortunately, the answer depends on the concept of Ethereum “gas fees”, which is a relatively volatile variable.
What are “Gas Fees?”
Because Ethereum transactions require computational energy to perform the blockchain charges users a “gas fee” based on the Ethereum metric of “Gwei”. Gwei is simply a tiny amount of Ethereum and is used to calculate costs involved in processing transactions.
On most NFT platforms, buyers pay a gas fee to validate a transaction on the blockchain network through their digital wallet. Sellers also sometimes pay gas fees to “mint” and sell NFTs, with the amount being spread to the network’s miners.
Gas fees fluctuate pretty rapidly depending on the time of day. By exercising patience, buyers and sellers can save a lot of money waiting for “gas prices” to come down.
You can use https://etherscan.io to see the current real-time cost of Ethereum gas and https://ethereumprice.org/gas/ to see previous price trends to try and predict when gas prices are lowest. While you can’t always avoid gas fees, you can at least mitigate the cost using these tools.
Typical Gas Fees
As NFT gas fees are based on the size of the digital asset and the complexity of the transaction, it’s tricky to nail down exact costs. Nevertheless, the following are estimates of NFT transactions based on average gas prices:
- Minting cost: $40-$100 ($70 average) to produce a single ERC721 NFT
- Listing cost: $10-$20 ($15 average)
- Auction cost: $40-$100 ($70 average)
- Destroying an NFT: $4-$10 ($7 average)
Comparing the Fees of the Platforms
With an understanding of gas fees in mind, we can now look at a selection of platforms and compare the profits and barriers of entry to each.
1. Rarible
- 2.5% fee on sale price
- Gas fees on minting, listing, etc.
- Optional “collections” cost $600-$1400 in gas fees to create
With a democratic, open marketplace, Rarible is one of the more accessible NFT marketplaces to start selling on with a low flat rate of 2.5% fee on all sales.
However, Rarible has creators shoulder many of the processing costs involved, including the gas fees for minting and listing their work.
It’s crucial, therefore, to check gas prices before listing to maximize your profit.
Rarible also gives creators the option to form “collections” of NFTs. This is recommended only to established artists though as the demand on the blockchain can cost upwards of $600 in fees.
$500 fixed price NFT: $380 earnings (minting, listing, 2.5% fee)
2. Nifty Gateway
- No initial fees for sellers
- Highly exclusive with a high barrier of entry
- 5% + $0.30 fee on secondary sales
- Creators can choose a 5-50% commission on secondary sales
- Gas fees only when withdrawing currency off-site
The highly exclusive NFT marketplace, Nifty Gateway, has been used to sell the work of famous crypto artists Beeple and Grimes. Labeling itself the “premier marketplace for NFTs,” Nifty has even formed a partnership with the British/American auction house Sotheby’s.
The Nifty Gateway marketplace has its own digital wallet called “Nifty Gateway Omnibus Wallet” using Metamask. This results in no gas fees for the seller until the time of withdrawal.
That means sellers lucky enough to be accepted to NG can list, transfer, and sell NFTs without gas fees.
Creators can also choose a 5-50% commission on secondary sales, with NG taking their own 5% + $0.30 cut.
$500 fixed price NFT: $474.7-$500 earnings (cannot mint though and additional gas fees to withdraw)
3. Opensea
- 2.5% fee on sale price
- Sellers can add additional fees for the buyer to pay
- No gas fees after initializing your account
- Gas fees passed on to the buyer
Opensea claims to be the largest NFT marketplace dealing with everything from digital art to trading cards, to domain names.
With a low barrier of entry, Opensea is extremely popular with sellers as it offsets gas fees to the buyer and only charges a 2.5% sale fee.
After an initial gas fee for “initializing” your account, you effectively no longer have to pay gas fees as a seller. Just remember to sell at fixed prices and don’t allow offers, unless you want the gas fees to sneak their way back in.
Sellers can also decide to eat the 2.5% fee themselves or add a fee on the sale price for buyers to pay.
$500 fixed price NFT: $475 earnings (2.5% sale fee)
4. Super Rare
- 15% fee on the final sale value
- Creators receive a 10% commission on any secondary sales
- Buyers pay a 3% transaction fee
- Gas fees apply
Super Rare stands as an NFT marketplace specializing in single-editions of digital artwork, allowing owners to buy, sell, and trade as they wish.
The marketplace is relatively exclusive with a high barrier of entry. Each artist is handpicked by Super Rare themselves to feature on the marketplace.
The site takes a 15% cut of the final sale value, and sellers are responsible for gas fees involved with minting and listing.
Despite the high fee, creators receive a 10% commission on any secondary sales tracked by the blockchain providing passive future income for artists.
$500 fixed price NFT: $340 earnings (minting, listing, 15% sale fee)
5. Christie’s
- Charges a seller’s commission rate based on a percentage of the hammer price
- Exact fee not disclosed and can vary between 10-50% of the sale price
- 2% performance fee if the high estimate is exceeded
- Highly exclusive and high barrier of entry
Famously selling Beeple’s Everydays for $69,346,250 in March 2021, Christie’s has confidently entered the NFT marketplace and doesn’t seem to be going anywhere.
The high-end British auction house is currently reaching out personally to artists to sell their NFTs, which means creators, unfortunately, cannot simply request their artwork be auctioned like Beeple’s.
With hammer fees between 10-50%, VAT charges, plus additional gas and performance fees on top, this may not be such a bad thing though. Unless your artwork is selling for a lot of money, then chances are you’d be better off on one of the online marketplaces.
$500 fixed price NFT: unknown (hammer fees, VAT charges, performance fees, gas fees if paying by crypto)
Conclusion
Nobody knows if NFTs are here to stay or will be a mainstay of the art scene. The concept is new and exciting, with changes happening every day. While platforms all have their own approach to fees, it’s hard to escape the gas fees related to accessing and using the Ethereum blockchain itself.
With platforms all handling gas fees differently, it’s always worth pricing your artwork on the higher side as a seller. Not only do you make more money, but you establish a precedent for the marketplaces where artists don’t undervalue themselves or their digital art.
