Why Launching NFTs on Hedera Makes Sense

Why Launching NFTs on Hedera Makes Sense
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As NFT utility surpasses the hype, it is crucial that innovative ideas and use cases can sustainably scale cost-effectively.

Mint a 10k NFT collection on Hedera for less than $100 

The organic growth and adoption of digital collectibles on Hedera has been impressive since they took off in late 2021.

Hedera is starting to see a vibrant community of collectors, creators, and ecosystem developers, leading to a sharp increase in usage of NFT use cases on Hedera in 2022 where creators can mint a 10,000 edition NFT collection for less than $100. 

A growing community of projects, applications, and ecosystem tools provide compelling reasons to choose Hedera to launch an NFT collection. Moreover, in a short time, NFT advocates and builders have banded together organically to kickstart the NFT ecosystem on Hedera.

Why Hedera?

HTS is a native tokenization service built on Hedera — it offers 10,000 transactions per second, easily configurable custom token royalties, the lowest carbon footprint of any public ledger, and low, predictable fees. In late April 2022, HTS integrated directly into Hedera’s Solidity-based smart contracts to take advantage of full programmability in Hedera dapps. The open-source, Hedera public network is excellent for getting started with NFTs.

Developers choose Hedera

The team at Hedera states they spent time talking with dapp projects through interviews, meetups, Discord channels, and more, discovering that four consistent themes emerged to explain why developers are choosing to launch NFTs on Hedera: Low fees, carbon-negative transactions, scalability, and ease of development.

Fees on Hedera

Fees on Hedera are fixed, denominated in US dollars, and paid using HBAR, the native currency of the network. The four top-line costs users need to know are below. 

Create a non-fungible token collection$1.00
Mint a non-fungible token in a collection$0.05
Associating an account with a token$0.05
Transferring any sum of token(s)$0.001

It’s easiest to compare the costs of minting NFTs on Hedera with other layer-1 networks. As seen, the cost difference is significant, with Avalanche currently getting closest to the value proposition of Hedera. Still, there’s an almost $600 difference to mint a collection of 10,000 NFTs. 

Carbon offsetting

The NFT community across web3 takes strong issue with the carbon footprint of public blockchain networks.

This comes as no surprise, with all this talk of global warming reaching its limits and NFT collections being responsible for killing kittens every day (that’s a joke, by the way). 

Carbon neutrality is not only an ethical standpoint but, increasingly, a marketing angle, and Hedera stands strong with a substantial value proposition.

Due to the architecture of Hedera and hashgraph consensus, the Hedera network is one of the most sustainable public distributed ledgers based on average energy consumed per transaction (0.00017 kWh), according to a recent study conducted by University College London.

While an excellent place to start, that was not enough for the Hedera Governing Council — in addition, Hedera has committed to being a carbon-negative public network through the purchase of quarterly carbon credits to offset emissions from all public-facing infrastructure. 

Certificates and details for the carbon offset program can be found here.

Scalable performance

The Hedera Token Service is a native service built on Hedera which can scale to 10,000 transactions per second with the finality of those transactions occurring in a couple of seconds. Performance measurements for every version of the Hedera Services Code can be found in the release notes documentation.

Ease of development

The Hedera Token Service makes it incredibly easy for developers of NFT-focused ecosystem tools, applications, and projects to get started without the need to configure complex smart contracts — it’s all native to the Hedera API.

Additionally, tokens are mapped to ERC-20, 721, and 1155 standards, ensuring interoperability with other Solidity-based smart contract networks. Builders can start by using this simple example of creating an NFT on Hedera with a custom royalty fee

Hedera NFT Growth

Being lightning fast and well priced can only get you so far in the world of web3, where It takes a spark to lift an entire ecosystem off the ground. In around six months, NFT collectors, project creators, and ecosystem devs have all banded together to inject a spark into the NFT ecosystem on Hedera.

NFT Transfers on Hedera

Looking first at the monthly average NFT transfers on Hedera, we see solid growth to the point where the cumulative number is almost doubling every month. This metric acts as a health indicator of secondary market sales of NFTs on Hedera and can indicate retail sentiment. 

Illustrating further, this metric is counting sales of NFTs on secondary marketplaces originally minted on Hedera. When the seller sends the NFT to the new buyer, it counts as a single token transfer and is added to the total.

Using DappRadar NFT tracking, this becomes crystal clear by looking at the leading NFT marketplaces on Hedera Combined, the two have generated almost two million dollars in trading volume. Zuse leads with more than $1.4 million, and Hash Axis has generated nearly half a million dollars. 

NFTs minted on Hedera

Looking at the number of NFTs minted shows adoption levels of launching digital collectibles on the Hedera network and the continuation of existing projects with further NFT drops. This metric looks at NFT collections minted on Hedera, i.e. a collection of 10,000 NFTs successfully minted by new owners. Each mint counts toward the total. 

Importantly, use cases for NFTs on Hedera extend far beyond PFP avatar projects, art, and simple digital representation, and they expect to see more use cases launch soon. Furthermore, Hedera expects Assets Under Control (AUC) to become a widely used metric to represent the success of a network regarding NFTs. 

Hedera NFT Collections are already taking off

Zooming in further, we can see several collections currently doing good numbers. Hbar Punks leads with its tip of the hat to the OG CryptoPunks collection on Ethereum. The collection has more than 1000 sales, driving more than $40,000 in trading volume. While the numbers are small-time compared to some collections on Ethereum, in an industry full of overnight success and failure, consistency can count for a lot. 

NFTs on Hedera in summary

A bear market can provide the perfect scenario for new technology and trends to emerge. While NFT collections on Ethereum appeared to have a certain quality and OG network stamp, the network is far from efficient for the many real-world use cases emerging in the aftermath of a PFP avatar frenzy. 

For example, the idea of using Ethereum to operate an NFT ticketing platform is quite simply, at this time, absurd. Imagine a user having to pay an Ethereum gas fee every time they wanted to mint a ticket. It would render the service inoperable. Whereas running a similar service on Hedera would potentially be able to deliver a Web2-like user experience on the blockchain. 

As NFT utility surpasses the hype, it will be vital that innovative ideas and use cases can sustainably scale cost-effectively. You can track Hedera NFTs on DappRadar and digital collectibles across 16 other blockchains on DappRadar. 

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