Rarible is what you’ll frequently hear if you are into NFTs. The platform describes itself as the first community-owned NFT marketplace.
The RARI governance token enables holders to vote on proposals that determine the trajectory of the project.
They borrowed heavily from the DeFi playbook.
A quick scan also reveals that Rarible is one of the few successfully NFT marketplaces that’s decentralized, paving the way for the community of token holders to take charge, calling shots.
NFTs are unique tokens minted on smart contracting platforms like Ethereum, the Binance Smart Chain (BSC), and others that give the holder control of digital work, that is, true ownership.
Unlike ordinary tokens, NFTs have a provision allowing users to attach files—which can be video, audio, or image format. This extended functionality gives NFT an edge, allowing for even more experimentation and value accrual.
This innovation is currently on fire, finding high adoption levels amongst creative. It is primarily because these artists don’t have to use a third party to negotiate rates.
Immediately after finishing their masterpieces, they can mint limited-edition NFTs with blockchain provenance and showcase them directly to the global audience. All they have to engage with are smart contracts.
It is here where protocols like Rarible come to play.
Introducing Rarible
Rarible is a portal where users—artists—can mint NFTs per the Ethereum ERC-721 or ERC-1155 standards. Afterward, they can store files in the InterPlanetary File System (IPFS) for even more security.
Minting would require the artist to fill out a form where they upload the file details and specify the listing price.
Additionally, Rarible is a marketplace, a digital space where artists, immediately after minting their pieces, can list, enabling market participants to purchase their work. Trading is done without a middleman.
Amid this, it is important to keep in mind that the minted NFT is still a token. Accordingly, it can be moved from one wallet to another trustlessly within the Ethereum blockchain.
The resulting transaction will see a transfer executed. While there are applicable fees, Rarible–being the facilitating platform–also receives a smart mark-up payable by the seller—the artist.
Fees—in Ethereum and IPFS– are paid only once by the seller.
However, there are royalties guaranteeing future cash flow to the sellers whenever there are subsequent transactions. What’s more, these royalties are paid out immediately.
Therefore, if, for example, an artist sets out the royalty as five percent, regardless of the eventual price of the digital artwork, the creator automatically receives their preset royalty piece the moment the transaction is executed.
Why Rarible is Unique
Rarible aims to completely decentralize its marketplace, depending only on audited smart contracts.
Eventually, all marketplace operations will be done straight from a DAO where RARI ERC-20 token holders are in control.
The team’s leadership is convinced that this is the only way of taking NFTs mainstream while adhering to blockchain’s guiding principle focusing on community, project decentralization, and security.
Already, this is the trend being fueled by celebrities, sporting personalities, and entertainment superstars. Besides, there have been multi-million NFT sales from leading digital artists like Beeple–an encouragement for upcoming but ambitious digital artists.
Subsequently, to further make the space attractive, Rarible wants to make NFT transactions cheaper.
Towards that end, Rarible plans to adopt Ethereum Layer-2, slashing down costs and scaling. This will significantly make minting and trading cheaper and more attractive for all users, regardless of their pocket depths, to participate without dealing with high Gas fees.
Additionally, the platform plans to support credit card payment and announce more partners. Already, Rarible has partnered with the Flow Blockchain by Dapper Labs—the team behind CryptoKitties. In this deal, Flow will support Rarible primary and secondary markets. They have the necessary experience since NBA Topshot offerings are done from the Flow Blockchain.
Rarible Team and Investors
Behind Rarible are two entrepreneurs and developers: Alexei Falin and Alexander Salnikov, who launched the platform in early 2020—when the NFT space was gathering steam.
They are both based in Moscow with deep experience in software and blockchain development.
Before launching, they receive pre-seed funding in September 2020 from CoinFund. Early this year, the team raised another $1.8 million from four companies, including 1kx. However, it is the latest funding round in July 2021 that truly brought Rarible to the fore. The team received $14.2 million from Venrock Capital, CoinFund, and 01 Advisors.
During this time, the Rarible team revealed that it had processed $150 million of transactions in the last year of operation. High-profile celebrities like Floyd Mayweather and billionaire Mark Cuban of the Dallas Mavericks have minted their NFTs through Rarible.
Mavs Getting Their First NFT Training Class and minted their first NFT collectible ! https://t.co/TTMkXJ0UrT? #rarible #ethereum #nonfungible #digitalasset #nft via @rariblecom
— Mark Cuban (@mcuban) April 10, 2021
Furthermore, their development team said although they were primarily domiciled in Ethereum—and from where they have enjoyed immense success—they plan to branch out to the Flow Blockchain, whose barrier to entry is generally lower—from the cost perspective than Ethereum.
Rarible (RARI) Tokenomics and Market Performance
At the heart of the Rarible NFT marketplace is the RARI token.
The project announced the launch of the governance token, which effectively decentralized the platform making users at the center of operations.
On launch, Rarible said it wanted to give its growing community the ability to influence decisions and, most importantly, incentivize market participation.
Since this governance model has proven effective and efficient in DeFi, the same could be ported to NFTs.
In all, RARI is the first token from an NFT marketplace provider.
Holders of RARI tokens can:
- Vote on proposals for platform upgrades
- “Hustle” in the Rarible DAO
- Select feature Artworks
- Participate in moderation
RARI can be acquired by:
- Using the Rarible NFT marketplace—through the “marketplace liquidity.” Every week, 75k RARI tokens will be distributed.
- Purchasing from the secondary market.
In total, there are 25 million RARI as total supply:
- 30 percent is for the team and investors
- 10 percent to Airdrops—2 percent Rarible users and 8 percent to NFT holders
- 60 percent to Marketplace Liquidity
RARI market performance has been impressive.
After launching, the token price surged 24X in Q1 2021 only to dip 65 percent in Q2 2021 but is now bouncing, adding 1.5X at the time of writing.
Each RARI token is trading at $33 from a circulating supply of 4,683,001 RARI tokens. From this, the Rarible market cap stands at over $158 million at spot prices.
The token can be traded in several exchanges, including SushiSwap, Kraken, Uniswap, Binance, and others.
Rarible (RARI) Catalysts
- Rarible is undervalued at spot rates. NFTs are expected to be a multi-billion industry. At present, RARI has a market cap of just $158 million.
- There are just 25 million RARI tokens. With slightly over 4.6 million in circulation, the demand for these tokens is expected to increase as NFTs popularity increases.
- RARI is the first NFT marketplace to issue a governance token. Early investors/adopters can benefit from investing in the first project to decentralize, racking in advantages like those who first got in BTC, ETH, MKR, and the rest.
- RARI posted sharp gains—rising 24X in Q1 2021. Losses were contained in Q2 2021. The recovery of Q3 2021 means early adopters are on the course of doubling their investments. This resilience to market-wide shocks points at the quality of the project.
- The Rarible project has strong investor backing. Over the last two years, regular funding indicates confidence in the platform and NFTs as a new and promising industry.
- Eventually, Rarible will completely decentralize using the DAO for governance. It is in the spirit of blockchain, a move that’s highly welcomed.
- The project is open source and completely non-custodial. There are no KYC requirements needed to invest.
- Their deal with Flow Blockchain and Dapper Labs—the team behind the first NFT crypto craze CryptoKitties—is aimed to improve user experience and reduce Gas.
- Rarible is special because NFT files can be minted and stored at the decentralized storage system—the InterPlanetary File System (IPFS). It is an ingenious means of guaranteeing security and avoiding the use of a centralized custodian.
- Rarible also specializes in creating a marketplace for digital art. This focus gives the platform a competitive edge over other broad-based centralized versions.
- Interestingly, Rarible is integrated with other NFT marketplaces, including OpenSea. Accordingly, besides selling NFTs on Rarible and earning royalties from subsequent sales, artists can easily manage their assets on third-party marketplaces and sell their work for ETH.
- The platform is easy-to-use, and minting NFTs doesn’t require expert coding skills. This low barrier to entry only allows more people to experience the power of NFTs, opening up gates for artists and traders.
- Rarible supports various wallets, not just MetaMask. This encourages participation from users who have reservations on MetaMask or prefer other wallets for security or convenience reasons.
- Alexei Falin and Alexander Salnikov have experienced software developers and blockchain experts. Their expertise attracts funding and further technical support with confidence that they will steer the project forward to multi-billion valuations.
- The development team continues to build, releasing more products. At present, Rarible is teasing the NFT Index, which would allow users to follow and even invest in some of the market’s most valuable collectibles.
- Rarible plans to introduce new functionalities, including a social media feature, launch a mobile app, release various types of NFT content, and create more avenues for fractal ownership of some of the space’s prized pieces.
- The NFT platform is already partnering with artists and other projects. Through their deal with Nexus Mutual, they have created insurance coverage for NFT pieces. The link with Nexus Mutual via Yearn Finance has been seen as a welcomed step for bridging DeFi and NFTs.