The Rarible Protocol was officially announced less than two weeks ago but received relatively little coverage considering it heralds a new phase for NFT platforms and marketplaces. Though primarily discussed in terms of its impact on developers, the Rarible Protocol only comes into full view when one considers its possible effect on creators. Taken as a whole, the development of the Protocol and the resulting ecosystem represents a model that addresses many of the current needs and desires of NFT creators.
On August 12, in a Medium post co-authored by Rarible‘s CTO and NFTS WTF DAO member Alex Salnikov and Rarible DAO‘s Head of Ecosystem Eric Arsenault, Rarible announced the availability of the Rarible Protocol. More recently, I interviewed both Salnikov and Arsenault. They clarified that Rarible and Rarible.com remain independent and that the Rarible DAO, sometimes referenced as the Rarible Protocol DAO, is now in charge of the Protocol built by Rarible. Rarible.com has fully transitioned to the protocol and intends to ultimately come under the governance of the DAO at a later date.
An Emerging NFT Ecosystem
Given that numerous Web 3 companies and independent groups are exploring DAOs and token-based governance, the biggest news here is that the protocol is the beginning of an NFT ecosystem that is poised to take advantage of a surprisingly disordered terrain. For example, standardized artist royalties for NFT secondary sales across major Ethereum chain marketplaces remain an unrealized promise.
By this point, the reality that an artist cannot sell an NFT on any major platform and receive secondary royalties on every other major platform is a conscious choice made by executives and a glaring failure across the board.
The Rarible Protocol takes advantage of the industry’s failures in a number of ways. But rather than reiterating features and future developments as outlined in the Medium announcement, here is a look at how Rarible is addressing the needs of NFT creators and crypto artists with the protocol which “at the core…is a decentralized [NFT] exchange.”
It should be noted that there are additional features and related initiatives of great interest to developers, such as the Protocol App Mining Program, which distributes $RARI for NFT app projects, and funding for proposals presented to the Rarible DAO. In addition, the benefits of the Rarible Protocol for NFT creators is a selling point for new projects seeking creator participation, no minor issue for businesses building two-sided marketplaces.
Minting Costs and Energy Concerns
The Rarible Protocol currently enables lazy minting on Ethereum with minting transaction fees being paid by buyers at the time of purchase. This feature is particularly important to lower-income artists and newcomers to the space looking to experiment.
In addition, widespread concerns about energy usage associated with minting NFTs has sparked interest in Proof-of-Stake blockchains. The Rarible Protocol is expected soon on both the Flow and Polygon blockchains where transaction fees are much lower.
Beyond the Ethereum Blockchain
Projects on Dapper Labs’ Flow blockchain, with which Rarible announced a partnership in late June, may also open up new pathways for NFT creators and marketplaces to reach mainstream users onboarded by NBA Top Shot.
In addition, interest in and uptake of Polygon by such creator-centric projects as NFT Hub is growing.
Fee Splitting for Creators and Developers
Automated fee-splitting is an option often requested by crypto artists, a wide number of whom collaborate regularly with other artists. Given the collaborative nature of the space, this opens up possibilities for developers as well.
Appear Across the Protocol With One Account
The Rarible Protocol’s shared order book means that “when an NFT is listed for sale, it is listed for sale across all applications built on the protocol.” Rather than having to set up multiple accounts on different platforms, NFT creators can streamline their workflow.
In fact, customizable storefronts are an option for creators opening up the possibility of minting and displaying one’s NFTs on one’s own website while appearing on storefronts throughout the ecosystem. This feature may help bridge the legitimacy gap between creators wishing to control their own operations and collectors unsure of what to think of a solo operation without the validation of an established platform.
Standard Secondary Royalties
Crypto artists are largely responsible for the institution of secondary royalties in some markets and creating a mindset in which such royalties are considered a best practice for NFT marketplaces. The heel-dragging of many platforms has been a massive disappointment to a large number of artists. In contrast:
“The Rarible Protocol implements a royalty standard for protocol-minted NFTs, as well as for externally minted NFTs. This enables NFTs sold on protocol applications to adhere to creator and platform royalties regardless of their provenance.”
For NFT creators, this approach not only means there will be secondary royalties inside the Protocol ecosystem as a standard. It also offers a concrete example of what creators desire and creates competitive pressure on platforms and marketplaces outside the Protocol’s ecosystem to fulfill such desires.
NFTs and Web 3 Values
As I learned from founding CryptoArtNet, many crypto artists accept that Web 3 solutions are still under development but hope, for example, to see less proprietary approaches to NFT marketplaces. So it seems fitting to close with Alex Salnikov’s take on NFTs and Web 3:
“NFTs can only live in the web 3 world. And that’s where we all exist…Web 3 is the world built on the principles of openness, neutrality, and self-sovereignty. When the user has the wallet that connects to the website and not the website temporarily giving the user access to things that the website owns.”
For more on the Rarible Protocol and the future of Rarible, please consider the following resources:
Featured Image Courtesy Rarible Protocol