The Non-Fungible Token (NFT) market was one of the fastest growing, with total sales in the first half of 2021 reaching $2.5 billion. While NFTs are nothing new in concept, the 2021 bull rally has certainly brought this market into the limelight. It all started with digital artist Beeple, whose NFT artwork brought in $69 million, and then Eminem, Floyd Mayweather, Beyonce, etc. Many mainstream celebrities like NFT joined the spree.
The most popular blockchain for printing NFTs is the Ethereum network because of its smart contract capabilities used to digitally validate real-world memories. However, the gas fee issue on Ethereum didn’t just affect Defi users and spot traders, even small NFT artists and traders faced a similar issue.
From printing an NFT to selling it, it can result in significantly higher transaction costs in the current gas fee. With the EIP 1559 application, all eyes are now on the London Hard fork to get rid of the increasing gas fee problem.
The London Hard fork, scheduled for August, could be a lifesaver for the NFT ecosystem and help it grow 10x, quite similar to the Defi ecosystem.
London Hard fork could potentially help NFT artists stand out
Gas fees are not an issue for artists selling their artworks for hundreds of thousands of dollars, but the number of such artists is very small compared to the entire NFT market. The NFT market is mostly made up of small artists with limited resources and income, and the same goes for small NFT collectors. A high gas fee could erode all possible profits.
The implementation of EIP-1559 during the upcoming London Hard fork promises to create a floor price model for gas fees paid to miners, rather than miners having the power to decide which operation to execute first. The proposal will make ETH a deflationary asset as additional ETH will be burned in the gas fee. Once the gas fee issue is resolved, both the Defi and NFT markets could see an uptrend and an explosive uptrend.