Coinbase NFT Beta Is Live, but Can It Bring Back Momentum for the Platform?

Six months after announcing a marketplace for non-fungible tokens (NFT), Coinbase has finally launched a beta version of the platform.

In a blog post, Coinbase shared the first version of ít Web3 social marketplace under the name Coinbase NFT. As part of its new offering, Coinbase has refrained from adding any transaction fees on its platform for a limited period, in order to gain traction.

The company chose to build the beta platform on the Ethereum blockchain. Currently, the marketplace has opened to beta testers by invitation only and there seems to be a waitlist for signups.

Meanwhile, when it comes to the differentiating factors of Coinbase NFT from other existing marketplaces, Sanchan Saxena, VP of Product, noted in the blog, “We learned that people don’t just want better tools to buy and sell NFTs: they want better ways to discover them, better ways to find the right communities, and better spaces in which they can feel connected with each other.”

This essentially means that Coinbase will allow users to use the platform to like, share, and interact with, similar to some options available on social media platforms on a Web2 space.

Supplying momentum to Coinbase

The announcement also comes at a time when Coinbase is struggling to maintain its strong price action from last year. Recently, Ark Invest’s Cathie Wood acknowledged in an interview that Coinbase in their portfolios was down over 40%. Based on weights, Ark Invest has the third-largest exposure to Coinbase but its valuations have almost been slashed by half in the past year.

To add to its growth momentum moving forward, Coinbase plans to add more features to its social marketplace. They noted, “We’re planning to add drops, minting, token-gated communities, and the option to buy NFTs with your Coinbase account or a credit card. We’ll also add support for NFTs on multiple chains.”

With that, the exchange also intends to decentralize more of its solutions through its NFT vertical. However, not everyone is convinced.

“I don’t think this is the big, promising thing,” Dan Dolev, managing director at Mizuho Securities told Bloomberg, as he believes that the platform might be “too little, too late,”

Meanwhile, the platform faces tough competition from OpenSea, one of the largest digital marketplaces. On Ethereum, OpenSea clocked a daily volume of over 88 million at the time of writing on April 20.

Additionally, LooksRare, which was hit by several wash trading allegations recently, is also nonetheless a heavy competitor to Coinbase’s NFT offering.