OpenSea is a popular marketplace where you can trade and collect NFT’s, rare digital items, and crypto collectibles. According to data collated from Dune Analytics, the marketplace reached its all-time high in volume traded on January 27, 2022. This popularity increase could be attributed to NFT’s seeing an enormous rise in searches, as reported by Google Trends. The search for the word NFT is currently at its all-time high.
The reason OpenSea is different from its rivals is simplicity. Anyone can trade their art and see how their personal creations fare in the open market. However, the marketplace has recently been subject to a few famous exploits, such as the Bored Ape Yacht Club NFT Exploit, where a Bored Ape was bought and sold well before the floor price.
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Looks Rare, the brand new marketplace on the block launched on January 10. They managed to impress the crypto community by choosing to release the $LOOKS token and airdrop it to fellow NFT traders and degens that have previously traded their NFT’s on OpenSea.
Offering rewards for traders and stakers of the $LOOKS token for using their platform; they compete with Opensea in true defi fashion.
According to an analysis done by Ricardo Rivas at Yahoo, LooksRare has surpassed Opensea every day on its daily volume since its launch having the highest daily volume of $842 million on January 19. However, as trading has increased for this Opensea rival, it has also become clear that some traders are using it to wash trade and manipulate the numbers to take advantage of the reward system of the marketplace effectively.
Dozens of Loot and Meebits NFT’s have sold for about £3 million worth of WETH a piece as seen on the top NFT sales list at CryptoSlam. The Looks Rare team has not officially commented on their official Twitter or Discord about the wash trading. Although they have shared the below post on Twitter, that alleges that the wash trading may be happening “by design…probably” and is “in fact, genius.”
High rewards may prove beneficial in the short term as we see a surge in volume in Looks Rare’s marketplace, but it remains to be seen whether $LOOKS will be able to maintain or even grow its volume in the future.
In the meantime, Looks Rare is receiving a lot of community support. The marketplace aligns with the web3 ethos, according to many community members. The user gets rewarded for using their marketplace. Looks Rare compared both Looks Rare vs. Open Sea’s sale of a Bored Ape, as seen below:
“LooksRare vs. Opensea – @BoredApeYC The buyer got $3.5k in trading rewards, and on Opensea, they would have gotten none. The seller saved $1.5k in fees and got $3.5k in trading rewards. That’s $5k+ more than they would have gotten on OpenSea.”
Opensea still holds the number one spot in terms of daily volumes, but Looks Rare is looking to be a genuine competitor. Whether their rewards system is sustainable, only time will tell.