Note: Occasionally a client may opt to remove a piece, or they may go out of business, merge with another company, etc. In those cases, I do my best to put my latest version here. This piece was originally for Alchemy.com.
Blockchain is evolving – and fast. New platforms and apps are popping up, more coding languages are appearing, and innovative new uses for cryptocurrency are being invented. The latest and greatest of those are NFTs, or non-fungible tokens.
If you haven’t heard of NFTs, here’s the scoop: NFTs are unique tokens that can be attached to just about any piece of digital content – images, video, music, you get the picture. NFTs allow artists (or anyone) to create one-of-a-kind products that are as unique as physical items like autographed CDs or original paintings. The implications are obviously far-reaching.
If you have heard of NFTs, you’re likely looking to build one. You may have been told that NFTs live exclusively on the Ethereum blockchain. After all, Ethereum-based NFTs have made waves. Visual artist Beeple sold one piece for $69 million. But Ethereum isn’t the only game in town. As it turns out, another platform is vying for attention in the new world of NFTs: Flow. And high-profile projects like NBA Topshot are already seeing success using Flow.
Here, we’ll examine these two blockchain platforms for the express purpose of creating NFTs, so you can decide which one fits you best.
Benefits of Building NFTs on Ethereum
To put it in the simplest terms possible, Ethereum came first. For this reason, building NFTs on Ethereum is the tried-and-true method, and you can count on the platform to deliver the goods. In fact, Ethereum leads when it comes to the number of decentralized applications that have been launched and daily active users.
This means that the number one benefit of using Ethereum is wealth of established resources for building vs. Flow. This robust infrastructure and extra experience does come with a price, though. Transaction cost is high on Ethereum, sometimes as much as $20 and up (even into the hundreds), owing to the fact that all smart contract transactions pay “gas” – a fee that varies based on contract complexity and network traffic.
Still, this high transaction cost indicates plenty of demand and a well-established platform with a high transaction volume. In fact, ether mining brought in a total of $2.35 billion in revenue in May of 2021 alone.
Not to mention Ethereum is already chock-full of proven templates and features that you can use as starting points. For example, Ethereum offers well-established tooling around the development process – wallets, minters, even easy ways to obtain eth to pay for gas, and fractional ownership to name a few.
Ethereum is the way to go if you’re looking for an established and robust toolset. You certainly won’t be alone if you use Alchemy to build NFTs using Ethereum.. Alchemy powers nearly all the NFT platforms in the Ethereum space.
Notable players include OpenSea (one of the largest NFT marketplaces in the world), NFTFi (integrating decentralized finance into NFTs), Axie Infinity (bringing NFTs to gaming), SuperRare (dealing in art from the world’s top artists), and Immutable (the first layer 2 for NFTs on Ethereum). Other notables include Nifty Gateway, Makersplace, Audius, Enjin, Roji, Zora, Foundation, NFT Hub, and Origin – all powered by Alchemy.
You can get started right now building Ethereum NFTs on Alchemy.
Benefits of Building NFTs on Flow
Flow is the new kid on the block, and just as Ethereum was built to solve flexibility issues with Bitcoin, Flow was designed to improve on Ethereum. Developed by Dapper Labs when its massively popular CryptoKitties game hobbled Ethereum’s network, Flow is specifically designed for scalability. The Dapper Labs team wanted to create a blockchain that could handle going viral and let them attract billions of users.
For this reason, Flow provides some obvious advantages over Ethereum for NFTs. First off, Flow can handle a lot more transactions. Think 1,000 transactions per second (tps) and working towards 10,000 as opposed to 13-15 tps.
Next, transaction fees are significantly lower, even though there are two separate fees associated with transactions on Flow. The first is an account creation fee which starts at 0.001 FLOW (Flow’s native currency) or about $0.03. Next is a transaction fee that starts at 0.000001 FLOW. This kind of efficiency is achieved through a more sophisticated multi-node architecture and a different consensus mechanism. Specifically, Flow uses a proof-of-stake (PoS) consensus model, whereas Ethereum uses the proof-of-work (PoW) model.
In case there’s any question about it, even Ethereum thinks the PoS model is more efficient, and they’re moving toward that model for the future, which should reduce transaction fees. Not coincidentally, this kind of centralization also increases tps – a big part of why it leads to lower transaction fees.
In addition, with Flow, developers have a unique opportunity to shape the entire ecosystem by being early builders. This also means there’s an opportunity to provide fans with a more bespoke purchasing experience – for example, NBA Topshop supports credit card payments natively.
Flow is definitely designed to be an upgrade over Ethereum, but that doesn’t necessarily mean it’s always the right choice. As a new technology only around since 2020, Flow has the same basic disadvantage as any up-start tech: it’s new, and new technology means some learning curve. But if you’re willing to take that on, you’ll get more flexibility and agility with Flow.
One of the most high-profile adopters of the NFT model using Flow, NBA Top Shot rose quickly with the help of $305 million in funding provided by major Hollywood players, the NBA, and even Michael Jordan. NBA Top Shot is the work of Dapper Labs, who created Flow, and the new endeavor has helped Dapper Labs grow to a valuation of $2.6 billion.
Flow’s success as an NFT platform purpose-built for gaming and other interactive experiences is attracting many developers and platforms, from games to art dealers.
Flow is also supported on Alchemy, so it’s easy to get going right away.
Alchemy: Your Partner for Building NFTs
There’s no single best platform for building NFTs. The fact is, each platform has its pros and cons, and the ultimate determiner here is you. In either case, the best thing you can do when you’re ready to start building your NFTs is partner with a blockchain company with experience and an infrastructure designed to make things easier. That’s where Alchemy comes in.
Alchemy supports both Ethereum and Flow, so your choice isn’t dictated by whether or not you have help. Either way, you’ve got a partner in Alchemy. Sign up for Alchemy for free today to get started building.