OpenSea Fees vs Gas Fees
While people may associate purchasing NFTs on OpenSea with high fees, the platform charges relatively little compared to other marketplaces. In fact, OpenSea only charges a 2.5% transaction fee to the seller (comparable with Rarible’s 2.5% fee to both the buyer and the seller, whereas many other NFT marketplaces, such as MakersPlace and SuperRare, will charge a 15% commission when the digital asset is sold for the first time.
In fact, the largest fees when purchasing NFTs are the Ethereum gas fees, which could often cost the equivalent of $150+ USD on a good day. The good news is that ETH gas will typically fluctuate throughout the day. This means that if you wait for the opportune time to purchase your non-fungible token, you may be able to get away with paying less to the Ethereum blockchain.
Gas Fees on OpenSea
There are a few instances where you will need to pay gas fees on OpenSea. These are separated between one-time fees and recurring fees.
You will need to pay a one-time gas fee on the following actions:
- Registering an Account – You will need to pay a one-time gas fee before you can sell NFTs on OpenSea. Paying this fee will allow you to trade between your MetaMask wallet and the marketplace, allowing OpenSea to access items to transfer them at the point of sale.
- NFT or Smart Contract Approval – If you minted your digital assets elsewhere, you will need to pay a one-time approval gas fee to sell it on OpenSea.
You will also need to pay gas fees whenever you complete one of the following actions on the marketplace:
- Offer Acceptance – As a seller, if you accept an offer from a potential buyer, you will need to pay the gas fees for the transaction.
- NFT Transfers – Whether you are transferring your ERC-20 to a second wallet or sending a gift to a friend, you will need to pay gas fees to the blockchain to finalize the transaction.
- Purchasing an NFT – If you buy an NFT, you will be responsible for the gas fees.
- Canceling a listed NFT or a bid – Cancellation will incur fees as you interact with the blockchain.
- Converting Currency Between WETH and ETH – Whenever you convert currency on the marketplace, you will need to pay a gas fee.
- Freezing metadata – When freezing your metadata, you are ensuring that the information will be permanently accessible on the blockchain for everyone to see.
- Withdrawing or bridging ETH from Polygon – If you withdraw or bridge ether from Polygon, you will need to pay gas fees. Note that the process could take several hours.
Estimating Gas Fees
While there is currently no way to estimate your gas fees when you are purchasing a specific NFT, you can always start the process to find out the approximate amount of gwei you would need to process the transaction (even this amount will change throughout the day). You can cancel the process at any time.
What is Gwei?
Gwei is the equivalent of 0.000000001 ether (ETH) and it is paid to the miners on the Ethereum network to process fees. Gwei is also sometimes referred to as “Shannon” in honor of Claude E. Shannon, the American computer scientist and mathematician credited as being one of the fathers of information theory.
Not only will the price of each gwei fluctuate along with the price of the Ethereum cryptocurrency, but the amount of gwei needed for a transaction on Opensea.io will also go up or down. You can never be 100% sure of the price you will pay until you process the transaction.
That being said, you can use tools like EtherScan to see the current amount of gwei needed for the average transaction, though you will need to remember that all aspects of gas prices will change throughout the day.
Occasionally, when a trending collection goes up for sale, you may observe a gas war where the gas fees could skyrocket in price to mint a new NFT. This is due to buyers wanting to ensure their transaction is processed, so they will choose to pay gwei above current market price. Fortunately, many collection creators are aware of this issue and are taking steps to sell NFTs in a different way to prevent future gas wars.
Gas Fees and ETH 2.0
The Ethereum blockchain plans to move from a PoW (Proof of Work) algorithm to a PoS (Proof of Stake) algorithm in late 2021 or early 2022. This is known as ETH 2.0 or “Serenity.” Not only will ETH 2.0 change how the blockchain is managed, but it will increase the number of transactions it can handle to 150,000 per second, decreasing overall congestion on the network.
Serenity will also reduce the amount of energy needed to process each transaction by 99%. This will likely make gas fees on the Ethereum blockchain much more affordable and almost negligible in the grand scheme of things.
Not only will this allow you to purchase your NFTs at a more affordable rate, but it will also encourage more Defi transactions on the blockchain as a whole, making Ethereum the cryptocurrency to beat long term.
How the London Hard Fork Affected Gas Fees
On August 5, 2021, the Ethereum blockchain underwent the London Hard Fork (also known as EIP-1559). This update was to help incentivize mining overall, increase transaction speed, and reduce the gwei needed to process transactions.
While many claimed this would reduce gas fees, it had little effect overall. Instead, the fork allowed people to better predict the price of fees so that they would overpay less often. There is some hope that, over time, the fork will help stabilize gas fees as a whole.
Frequently Asked Questions
Who Pays Fees On OpenSea?
The seller will pay the 2.5% transaction fee on OpenSea. If there are royalties associated with the NFT, the seller will pay those as well from the total percentage of the sale. Sellers will never have to pay more than 10% toward royalties, but this percentage will vary depending on the asset.
How Much Are Royalties on OpenSea?
NFT artists who mint on OpenSea have the option of setting royalties up to 10% of the transaction price. This means that royalty fees will vary depending on the asset in question, but can be up to 10%. Sellers will need to pay these fees on all secondary sales of the digital art.
Are There Cheaper Alternatives to OpenSea?
As far as transaction fees go, OpenSea alternatives will often charge a similar or higher fee. That being said, if you are looking to pay less in gas fees, you can look at trading NFTs on alternative blockchains. For instance, MintBase runs on the NEAR blockchain while SolSea runs on Solana. You can also eventually transfer these assets to the Ethereum blockchain using bridges.