Foundation is one of the largest NFT trading marketplaces where digital art collectors can select and buy works with cryptocurrency. The site hosts work by both beginners and famous artists.
Before the creation of such websites, all paintings, prints, street art, installations, and other works of art that were created in a limited edition were transferred to private ownership of collectors for big money through traditional auctions.
It was very difficult for the authors to get to such auctions. Artists had to engage in creative projects for a long time in order to gain universal recognition or the attention of a gallery curator.
How the Digital Art Market Developed?
Since the launch of NFT technology, new opportunities have emerged for the sale and purchase of works of art, but this time in digital form.
The development of the digital art market began in 2017 when the American studio Larva Labs released CryptoPunks, a project for trading unique cartoon characters on the Ethereum blockchain. At the end of 2017, another project was released called CryptoKitties. This project allows players to buy and sell virtual cats. It became popular very quickly and attracted an investment of $ 12.5 million.
This was followed by other similar projects that attracted large investments.
For example, in early 2020, Dapper Labs (developer of CryptoKitties) released the beta version of NBA TopShot. It is a project to sell tokenized collectibles from the NBA realm. The project was built on the Flow blockchain. As of November 2021, total sales were over $ 800 million.
The NFT market experienced rapid growth during 2020, with its value rising to $ 250 million. In the first three months of 2021, users spent over $ 200 million buying NFTs. By November 2021, the NFT market was already valued at $ 10 billion, according to the NonFungible service.
Collectors began investing digital currency in digital art, and artists who had been waiting for universal recognition for many years finally received an appreciation for their work.
NFT Technology Principle That Influenced the Development of the Digital Art Market
NFT tokens imply the binding of a unique digital signature to a specific digital file, and this signature cannot be forged. This turned out to be a watershed moment in the empowerment of the cryptocurrency market. And one of these opportunities is the auctions where the following are exhibited:
- audio and video files;
- digital paintings;
- 3D sculptures;
- game characters;
- domain names, etc.
Technically, an NFT token is a password-protected link to any of these items. The difference between NFT tokens and cryptocurrencies is the uniqueness of each token and the fact that they are not equal in value in their species group. It is this meaning that is embedded in the name “non-fungible token.”
When a transaction is made, each token is sold in its entirety, unlike cryptocurrencies, which are divided into smaller units. NFT tokens lose their value when split into smaller pieces but can be duplicated by the artist. Each additional copy can be sold separately, but the total number of duplicates will always be known.
Principles of Organization and Functionality of the Foundation.app Trading Platform
Most trading platforms have introduced verification and invite in order to limit the selection and try to attract trusted artists to auctions.
The Foundation.app trading platform has the following principles of its work:
- Foundation.app focuses on exclusive digital art, so you can only get there via invite. An invite is a personal invitation from a participant who is already inside the site and has an NFT sale.
- The platform is developed on the Ethereum network and you must connect it to a wallet like MetaMask if you want to place bids on this auction.
- If you have ETH on your wallet, you can buy any artwork listed there on Foundation.app. However, you will not be able to create NFTs for sale. Foundation.app only permits this to be done by artists who already have at least one NFT sale.
- When you have sold one NFT, the selling features will be unlocked for your account. Also, after the sale of NFT, you receive an invitation code that you can use to invite other artists to the platform. You can easily pass the code to any person, but it is used only once.
- Each time an NFT is sold on the Foundation.app platform, the performer receives 10% of the secondary transaction performed. This means that when a collector resells an artist’s work, the artist receives 10% of the sale.
- Foundation.app keeps track of the entire trading history of art that is sold on its platform for creators to watch. The story includes the total amount in EHT paid by the person who bought the artwork.
When you choose concrete specific NFT, you will receive detailed information about this token, including:
- how much time is left before the auction;
- the current rate set in ETH;
- the degree of uniqueness of a particular NFT and a brief description of the uniqueness.
How to Sell on Foundation.app?
Foundation.app is a resource where, first of all, you need to show your work, with the maximum involvement of the future audience. For this, you will be asked to leave links to your social media profiles.
To submit your work to Foundation.app, you must:
- get an invite;
- create a profile and verify it with a wallet;
- choose your work;
- add a job description;
- specify the minimum selling price;
- pass the community vote and get at least five votes in your profile;
- submit your work to the sales list.
In this case, you pay:
- token binding (mint);
- putting work up for auction (list);
- changing the price of your work;
- withdrawal from the auction.
For laying out the first work, you can conditionally give from $ 10 to $ 200 as a commission. Therefore, you should definitely monitor the cost of GAS — the commission of the blockchain system depends on it for linking NFT to your work and laying out a new drop.
The result of your sale depends only on your luck, fame, community support, and how well you prepared your audience before the start of the auction. Therefore, many artists get to know collectors and notify them in advance on Twitter and Instagram about the start of sales.
Financial Rules for Foundation.app Users
No matter where you buy NFT, the Foundation.app marketplace charges a commission to make the sale possible. The commission charged is usually a certain percentage of the total selling price and is paid by the buyer (similar to art galleries that receive a share in the sale of any painting).
Foundation.app charges 15% to merchants as a service fee. It is the maximum service charge rate among similar platforms. This amount does not include the Ethereum gas charges that the Ethereum network requires to process transactions.
Foundation does not work with PayPal payments or credit or debit cards. Therefore, you must first have ETH in your wallet in order to interact with other users in this market. You can make trading transactions in any currency, but you can pay for NFT only in ETH.
Pros and Cons of Foundation.app
Foundation.app is one of the best platforms for creators to sell their work for a reasonable price. However, Foundation.app has both advantages and disadvantages.
Benefits of Foundation.app:
- Uncomplicated and user-friendly interface.
- Artists and many other creative people have the opportunity to sell their works through online auctions.
- If the NFT is resold on the OpenSea and Rarible platforms, a 10% royalty goes to the wallet in which the NFT was originally minted.
- If you have linked the MetaMask wallet, then Foundation.app automatically performs all actions with the wallet, so you do not have to additionally transfer the cryptocurrency to the exchange wallet.
Disadvantages of Foundation.app:
- Artists have difficulty getting an invitation. The invite channel is constantly registering hundreds of new artists, animators, art digitizers, and musicians. And only a few of them receive this invitation.
- After receiving an invitation, many artists wait for a long time from the community to approve their registration (at least five people must vote in the profile). For these reasons, it makes sense to start selling your work on another platform and switch to Foundation.app after the first sales.
- High commission payments.
- The seller must pay for many functions when manipulating his file on the site. It greatly increases the cost for creatives using Foundation.app.
- Payments are made via ETH only.
It is an obvious fact that NFT has given new meaning to digital art. Also, NFT technology opens up new avenues for the commercial use of digital values and assets. Therefore, the Foundation.app platform and similar marketplaces are becoming more and more relevant. Recent events and high-profile sales on marketplaces confirm that art and collecting will always bring a lot of money and pleasure.