OpenSea’s journey has been a thrilling adventure, filled with remarkable triumphs, unforeseen obstacles, and an unwavering commitment to exploring the unexplored realms of the NFT space. Devin Finzer, the CEO of OpenSea, a once $13 billion NFT marketplace, now finds himself bullish on NFTs as the platform delves into new use cases.
OpenSea is preparing for a comeback following the recovery of the market. The rising value of tokens and the highly anticipated introduction of Bitcoin exchange-traded funds have indicated the end of the crypto winter. However, while it used to be one of the hottest sectors, a crucial section of the digital asset universe has lagged behind.
According to CryptoSlam, a data tracker, global blockchain-based sales of NFTs, which represent unique ownership of assets like photos or physical objects, dropped by 63% to $8.7 billion last year. This decline occurred despite the volume more than tripling to $918 million between October and November. In contrast, Bitcoin, a bellwether of the industry, experienced a 160% increase in value in 2023.
This significant shift from 2021, when multi-million dollar NFT sales played a defining role in the crypto bull market, calls for a new perspective on NFTs. These tokens, known for collections like the Bored Ape Yacht Club, were marketed as a fun and accessible way for the general public to enter the world of cryptocurrency. They also served as status symbols for those willing to spend fortunes on a cartoon ape to be their Twitter profile image.
Devin Finzer, the CEO of OpenSea, believes it is time to view NFTs as more than just valuable images. He asserts that when assessing success in the NFT market and his own company, sales figures are not the only measure to consider.
In August, the former head of product at OpenSea was found guilty of insider trading, and the company faced significant backlash for removing mandatory royalties for NFT developers using its platform. As a result, the startup had to lay off half of its workforce in November. Competitors like Blur, OKX NFT Marketplace, and Magic Eden have recently gained more trading volume than OpenSea, according to crypto data tracker DappRadar.
Will OpenSea be able to succeed in its recovery plan? Finzer shared in an interview with Bloomberg that the company is working on OpenSea 2.0, an upgraded platform that will offer users an enhanced experience and better differentiation between NFT categories as new use cases emerge. Currently, NFTs are displayed in the same way on OpenSea and other platforms, regardless of whether they represent event tickets or gaming tokens. Marketplaces like Blur and Tensor have gained popularity by providing users with a more sophisticated trading experience that allows them to take advantage of rapid price fluctuations.
OpenSea’s upgrade will grant users access to its pro trading platform and the ability to switch between a collector view and a more advanced view. Finzer also mentioned that the company has improved its detection capabilities for fraudulent NFT collections and harmful URLs. Scams involving users connecting their wallets to malicious websites and subsequently having their cryptocurrencies and NFTs stolen have been a persistent issue in the industry.
Finzer did not comment on OpenSea’s future plans regarding the reinstatement of a mandatory royalty program or the decision to remove required royalties for NFT creators.
In terms of other developments, Finzer has been keeping an eye on the growing adoption of Ordinals, which are similar to NFTs but stored on the Bitcoin blockchain, as well as the increasing prominence of the Solana blockchain for NFTs. He remains optimistic about Ethereum’s potential to be the preferred blockchain for non-fungible tokens, particularly with the contribution of its layer-2 chains in accelerating transactions and reducing costs. Despite the ETF frenzy boosting Bitcoin’s price, Finzer does not foresee the blockchain becoming a significant option for NFTs in the future.