Nifty Gateway was launched as a marketplace for curated art drops but then pivoted to an ETH NFT marketplace. The company has recently announced that it will cut Ethereum gas fees by up to 70% on NFT transactions.
Gas is the variable cost for transacting on the blockchain. As NFT adoption increased, so did gas fees. High fees meant fewer people could afford to buy NFTs on the Ethereum blockchain.
“Gas fees have become a really challenging issue for all Ethereum-based projects at this time. If you’re spending $200 on an NFT and the gas fee to purchase that NFT is $100, a lot of times, you’ll just choose to not make that purchase. We’re hopeful that this will be a boon for the entire NFT ecosystem,” said Duncan Foster, Cofounder, Nifty Gateway.
This January, the marketplace will update its current custodial system to facilitate wallet-to-wallet transactions, thereby implementing significantly less gas than peer-to-peer trades.
What is the secret sauce? Generally, peer-to-peer NFT transactions on platforms like OpenSea require 10 on-chain steps to complete the process. Nifty Gateway is taking most of these stops off-chain to facilitate cheaper gas fees. The company says the custodial system that powers Nifty Gateway is the secret sauce that makes this possible. So, it only keeps the things that literally have to be on-chain; the rest are transferred off-chain. Off-chain means it moves the value outside the blockchain; handling them outside of the Ethereum blockchain minimizes the total gas fee.
Through this hybrid model, Nifty Gateway provides a new standard way of trading NFTs. They believe that such a system will benefit projects that trade in the hundreds of dollars per NFT and minimize entry barriers.