After focusing on building a platform for digital artists to create art on the blockchain, Highlight has unveiled a secondary NFT marketplace focused on collectors.
Previously, only artists could mint NFTs and sell them on Highlight, an Ethereum-based platform, but CEO Nathaniel Emodi told Fortune that giving collectors a louder voice helps artists—and makes the ecosystem more sustainable.
The secondary marketplace, which launched Thursday, offers artists a 2% minimum on all secondary sales and waives their mint fees. This lets artists mint whenever they want and keep pieces in reserve, selling them whenever prices go up—not just immediately to recoup fees.
It’s this focus on artists and collectors, rather than on high-frequency NFT traders, that separates Highlight from its peers, Emodi added.
“There’s a real feeling in the digital art space, among people who are really enthusiastic about digital art, that there’s no alternative, at least within the Ethereum ecosystem,” Emodi added. “There’s no place where you can vote with your dollars and vote with your on-chain activity, the art that you’re buying and selling, for creating a better ecosystem.”
Collectors, not traders
The Ethereum-based NFT ecosystem has two main players. OpenSea, which launched in 2017 and formerly dominated the space, closed December with a market share of about 21.6%, while Blur, a relative newcomer that began operations in October 2022, clocked in at 75.1%, according to the Block Data Dashboard.
In addition to a 2% royalty fee for artists, a 1.5% marketplace fee helps ensure that buyers on Highlight are there more for admiring artwork than for flipping it. Blur doesn’t charge traders a fee and offers just 0.5% in royalties for creators, while OpenSea charges a 2.5% fee and has no minimum requirement for royalties in NFT contracts.
In another appeal by Highlight to collectors, they can now view the algorithms behind the final mint of pieces. Within the algorithms may be different versions of a piece or features not included in the end product. Additionally, collectors can create listings of pieces they own that could give them preferred access to new releases from artists who are collaborating with Highlight.
In surveying the landscape of NFTs, declining royalties have been detrimental to the ecosystem, but, Emodi argued, those who’ve stood strong—a group that includes art galleries and Fortune 500 companies—show that digital art isn’t a passing fad.
“I think that the bear market, or the Crypto Winter, has really revealed that there’s an incredibly strong and vibrant ecosystem of artists and curators and collectors and enthusiasts,” Emodi told Fortune. “I think the overall feeling that this was just a passing fad is something that has been proven to be untrue.”
