Many people may be interested in exhibiting their own NFTs after reading in the news that an elementary school student made about USD 311,000 through free NFT research.
However, there is a fee called “gas fee” to list NFTs, and OpenSea requires a gas fee when you list your work for the first time.
If you are trading in Ethereum, you may have to pay more than USD 38.9 in gas just to list your work. But with Polygon, you don’t have to pay for gas and can list your work.
You may be tempted to list your items on Polygon, but just because you don’t have to pay for gas, due to the difference in markets and the hassle involved, it doesn’t mean that Polygon is absolutely the way to go.
In this article, we will explain whether Polygon or Ethereum is recommended for listing NFTs on OpenSea.
- 1 What are Polygon and Ethereum in OpenSea?
- 2 Ethereum and Polygon, the future of each
- 3 Which is the best way to exhibit NFT at OpenSea?
- 4 Summary of Differences Between Polygon and Ethereum
What are Polygon and Ethereum in OpenSea?
NFTs are leveraging blockchain technology to create one-of-a-kind asset values, and the fields that can be expected with the advent of NFTs include digital art, photography, gaming, and many others. The world of NFT art is a particularly deep field: buy interesting and intriguing works from artists around the world on the NFT market.
All prices on OpenSea are quoted in ETH, as ERC-721 is the first standard for representing irreplaceable digital assets on the ETH blockchain. However, as the volume of NFT transactions has increased, a problem has arisen. It is a remittance fee called gas fee.
By paying the gas fee, the user gets the transaction approved and as a reward, pays a portion of the ETH to the minor miner as a commission. The gas fee rises when the network is busy (overloaded with transactions). Another drawback is that the gas fee is not a fixed percentage of the remittance amount and is constantly fluctuating.
Also, when rare NFT art is sold, the volume of NFT transactions increases, and the price of ETH also rises as more people want ETH to purchase it. The price of ETH rises when rare NFT art is sold, as more and more people want ETH to purchase NFT art. To solve the gas price problem, Polygon, a crypto asset and MATIC network, was created.
Polygon (MATIC) is a project created to solve the scalability problem that ETH has. It is a second layer that also uses technology to transact outside of the main blockchain; the use of ETH has increased so much that transaction processing has become slow and expensive on gas, so Polygon is processing it.
The number of Polygon users is increasing steadily due to the high gas prices of ETH. The price is $1.38/MATIC (as of April 17, 2022). With the Polygon network, network load can be reduced due to faster remittance processing speed.
Characteristics of Ethereum
ETH is the second largest crypto asset with a market capitalization of approximately 2.1 trillion, second only to BTC (as of April 2, 2022). It is the highest-ranking crypto asset among altcoins.ETH is a crypto asset that has introduced smart contracts. Smart contracts, simply put, allow “contracts” that were previously done manually to be “automated” through the blockchain. One of the features of ETH is the ability to use the blockchain’s approval system to write tamper-proof contract records on the blockchain.
On the ETH platform, it is also possible to develop decentralized applications. Decentralized applications, translated as dApps (Decentralized Applications), are “decentralized” systems that do not have a central administrator. Instead of having an entity such as a bank approve transactions, they are calculated and approved by minor miners, and only then are transactions completed.
It is also noteworthy that more than about 1,000 dApps have been released from ETH, including “decentralized exchanges (called DEX)” and games. This led to a boom in new fundraising using crypto assets called ICO (Initial Coin Offering) in 2018. ETH was also used in ICOs at that time. (It is also worth noting that most ICOs lacked trust and have almost lost their asset value.)
ETH’s versatility has led some to compare it to “BTC is gold, ETH is silver.” This flexibility of use is the reason why it is being used for NFTs (non-fiat tokens).
Advantages And Disadvantages of Using Polygons
The biggest advantage of using Polygon is that you do not have to pay for gas that you used to pay at ETH. If you are an artist and want to list your work as NFT, you can use Polygon’s network and not have to pay for gas when you list. Polygon’s fast transaction processing speed makes it a good choice for relatively small NFT transactions.
The disadvantage is that you have to add the Polygon network (MATIC) to Metamask.
- Network name: Matic Mainnet
- New RPC URL: https://rpc-mainnet.maticvigil.com/
- Chain ID: 137
- Currency symbol: MATIC
- Block Explorer URL: https://explorer.matic.network/
How to do it.
- Register and login to Metamask
- Select a custom RPC for the Metamask network
- Copy-paste the above URL and chain ID and register.
You can now import the Polygon network.
For more information, please check this article.
Another disadvantage is the time and effort required to bridge ETH to the Polygon network. Other than that, the volume of transactions on OpenSea is low. Auction sales are also a disadvantage.
And the biggest disadvantage is that ETH earned on the Polygon network cannot be sent directly to exchanges such as Binance, Coin check or Bit Flyer in Japan. It must always be re-bridged back to the ETH network. Of course, Polygon cannot be directly converted to any currency.
In the end, you need to exchange it into ETH or dollar-pegged currency (USDT or USDC), so the hassle of doing so is also a disadvantage. Also, the Polygon network itself is not very reliable.
Advantages and Disadvantages of Using Ethereum
ETH is used in various services, such as OpenSea, where trading units are denominated in ETH, and Axie Infinity, a leading Play to Earn (Block Chain Game) where you earn tokens by playing games, where you transfer funds into the game. Because of the versatility of ETH, there are advantages to just having it as an asset. The disadvantage is the cost of gas, and if the cost of the gas transferred from Metamask is not stabilized (e.g., set as a percentage of the transfer fee), it could lead to a loss of users who use the ETH mainnet. Other factors include the fact that minor miners will prioritize high value transactions for remittance, and cheap transactions will be put off until later. The slow transaction processing speed is a disadvantage that users often find stressful.
Ethereum and Polygon, the future of each
The Future Potential of Ethereum
The future of ETH is explained by the price trend that ETH has gone through so far: ETH was created in November 2013 and remained at around USD 3.9 until February 2016, when it rose to around USD 12.5 due to the Homestead Update. The price then rose to USD 16.3 due to DAO’s large-scale project.
In 2017, the business use of ETH became more active, and the price rose to USD38.9 in May. Also in 2017, which some may remember as the first boom year for crypto assets, the price showed the same steady rise as BTC, reaching a high of USD 1,244.5 in January 2018.
However, it fell to the USD 77.8 level due to the surge caused by the boom and the beginning of ICO regulations in China and other developed countries. 2021 was also characterized by less active price movements until May 2021, when it reached its highest price, crossing the USD 1,555.5 mark. Factors contributing to this were the last ETH update, Serenity, the adoption of USDC by VISA, and the approval of an ETH-denominated ETF by Brazil.
As of April 12, 2022, ETH is about USD 2,908.8, but many investors expect ETH to reach USD 7,777.5 in the future; if the trading volume of NFTs accelerates further, more people will need ETH there, and further price increases can be expected.
However, China has announced that it will issue a digital renminbi, and if it bans the exchange of crypto assets, including ETH, a price decline will be unavoidable. We should always check the legal and regulatory developments of large countries such as China and the United States.
The Future Potential of Polygon
There is no doubt that NFT trading in ETH will become even more active than it is now. This will likely lead to a combined increase in the number of users using the gas-free Polygon network.
However, in the future, companies and others that find the Polygon network attractive will enter the market and invest money, which will lead to the lubrication of the network and, in turn, to an increase in the price of Polygon, which is invested in the network.
If the Play to Earn service, which allows users to earn money through games such as Pegaxy, gains popularity, the future of the Polygon network will increase. We believe that the company will be able to provide a more effective and efficient service to its customers.
Which is the best way to exhibit NFT at OpenSea?
Ethereum is Recommended for Targeting Overseas Collectors
OpenSea attracts collectors and buyers from all over the world. Celebrities in the U.S. have made it a status symbol to use the rare NFTs they have purchased as their Twitter icons. Particularly popular NFT series are those known as Crypt Punk and BoredApe YachtClub, which have been purchased by rappers Jay-Z, Eminem, and hip-hop producer Timberland, who have made them famous as icons.
Since they are already successful in their day jobs, they purchase NFT in anticipation of the exclusivity of owning a part of that collection and the future of their own NFT art. They believe that the character itself will become even more popular.
In other words, OpenSea has a chance to catch the eye of overseas millionaires (rich people) who are interested in NFT art and buy it. And the majority of traders on OpenSea will be those who enter the market using the ETH mainnet.
Famous overseas exhibitors also want to spread their own work around the world, but the reality is that they are earning ETH by selling their work. If you are targeting overseas collectors (especially high value users), we recommend you to trade in ETH.
Ethereum is Also Recommended If You Want to Make Money with NFTs
I’m serious about selling NFT art, photography, and video content, and I want to turn it into a business! If you have a passion for NFT and want to continue to make money with NFT in the future, we recommend that you list your items on ETH.
NFT also allows secondary resale of purchased works. By exhibiting and selling your own work, you can also earn up to 10% royalties (a set amount of compensation paid to the NFT producer when the work is sold secondarily). It is also possible to purchase works by famous artists and sell them at a high price.
The customer base for participating in OpenSea on the Ethereum network is completely different from the customer base for participating on the Polygon network: many of those who participate on the ETH network are affluent (rich) and have a large number of users.
If you are attracted to NFT production and have the determination and resolve to exhibit as an artist for the next 10 years, we recommend that you exhibit on the ETH Network. Above all, if you also have the ETH you have earned, you can expect the value of your ETH to go up, and you can expect it to go up.
Polygon is Recommended for NFT Beginners
You can still exhibit your own NFT work by importing the Polygon network into Metamask, but with ETH, you have to pay for gas to exhibit, which is a hassle. We recommend the Polygon network.
However, the user base using Polygon does not include many high value traders. You should be able to sell your work for a higher price. It should be worth more. If you are a user of the Polygon network, you may not be able to convey the value of your work and may not be able to purchase it.
However, in Japan, it is said that only about 2% of the Japanese population has been involved in NFT, so just exhibiting your work is a wonderful act. We recommend that you try out your NFT on the Polygon network first.
Polygon is Also Recommended for Those Who Want to Minimize Risk
Although there is a risk of self-GOX (loss or inability to withdraw crypto assets due to carelessness or mistake) when bridging owned ETH to the Polygon network, we recommend trading on the Polygon network as long as that task is cleared.
For example, an artist who wants to sell his/her artwork to a limited number of fans, or who wants to start with NFT artwork first, can sell the artwork itself at a lower price on Polygon, which does not require gas.
Fans who are willing to buy are also difficult to purchase at ETH, but Polygon makes it easy for them to enter the market because there is no gas cost and they can easily purchase the artwork. In fact, we asked an acquaintance of mine to illustrate my own work in NFT, and it was on the Polygon network that we made the purchase.
When sellers have to pay for gas, they also have to raise the price of their NFT work to cover the cost. Moreover, if it does not sell, it leads to the risk of just paying the gas fee as an initial investment. If you want to minimize the risk when exhibiting, the Polygon network is the way to go.
Summary of Differences Between Polygon and Ethereum
A summary of Polygon and ETH is below.
- Polygon is a complementary project designed to solve ETH’s problems and does not cost gas
- Even within OpenSea, ETH and Polygon have different clientele and market sizes.
- ETH if you want to earn serious money by exhibiting NFT works, Polygon if you want to exhibit as a hobby first.
If you want to sell NFT, it would be better to sell on Polygon first, and then on ETH, which has a large market, when you get used to it and feel you can make money.