Pallet Exchange: Revolutionizing the NFT Marketplace on Sei Blockchain
Despite the 88% decline in NFT sales volume from the 2022 peak and a 38% year-to-date decrease, Pallet Exchange is determined to reshape the NFT marketplace landscape by prioritizing user retention. Built on the lesser-known Sei blockchain, this innovative platform has caught the attention of investors, securing $2.5 million in a private funding round led by Spartan Group, Symbolic Capital, Cypher Capital, and angel investors from prominent companies like Coinbase and MoonPay.
The Beacon: The Catalyst for Change
Kelvin Wang and Davy Li, the co-founders of Pallet Exchange, are no strangers to the web3 gaming world. They previously created The Beacon, one of the most popular web3 games on Arbitrum, a layer-2 blockchain built on Ethereum. While developing The Beacon, they identified friction points in the marketplace, such as speed, transaction time, and user experience, which inspired them to create a faster and more user-friendly NFT marketplace.
The Human Nature of Trading and Collecting
Wang and Li believe in the strong potential of NFTs due to the inherent human desire to trade and collect. As Wang puts it:
The fundamental draw from a user to trade and flip is very human naturey. We’ve seen that with collectibles, cars and toys.
Addressing Pain Points in the User Experience
Pallet Exchange aims to tackle the pain points in the user experience often found in crypto platforms that are heavily focused on financial aspects. Li compares the experience of a novice user navigating a typical crypto platform to a beginner being thrown into the Bloomberg terminal. Pallet Exchange strives to create a more accessible and beginner-friendly environment.
Retaining Users in a Bear Market
The founders acknowledge the challenges of retaining customers in a bear market when making money becomes more difficult, especially for novices. To address this, Pallet Exchange is experimenting with liquidity and retention mechanisms that make users feel like they’re progressing and engaging in meaningful, enjoyable activities with their NFT collections, even when the ”number doesn’t always go up.”
Gamification and Social Features
Pallet Exchange is incorporating social media tactics, such as in-app messaging, to foster community engagement among users interested in the same NFT collections. Li envisions a scenario where purchasing an NFT automatically adds the buyer to a group chat with other holders, creating a sense of community. The platform also plans to introduce clans where friends can collaborate and enhance the gamification experience beyond simple points systems used by many marketplaces.
Why Sei Blockchain?
While Ethereum, Bitcoin, and Solana dominate the NFT space in terms of sales volume, Pallet Exchange chose to build its marketplace on the Sei blockchain due to its impressive speed of 12,500 transactions per second and low gas fees. The team sees an opportunity in Sei’s less-chartered territory, drawing parallels to the early days of Solana.
Moreover, Sei’s creators are working on attracting Ethereum Virtual Machine (EVM)-based developers by developing a technology called The Parallel Stack, which aims to make Ethereum faster and less costly. This development has convinced Pallet Exchange that Sei’s ecosystem will continue to grow and thrive.
Early Success and Future Plans
Pallet Exchange’s bet on Sei, its social aspects, and its user-friendly interface has already paid off. The platform, launched in September, experienced a boom in December with the rise of Seiyans, an Sei-based NFT collection driven by meme culture. Today, Pallet Exchange holds about 99% of the NFT market share on Sei, with over $20 million in trading volume year-to-date, 2 million users visiting the platform in the past year, and 40,000 to 50,000 daily users.
Looking ahead, Pallet Exchange plans to explore partnerships with major players in the art marketplace and create a separate marketplace for those creators, ensuring unique experiences for both one-of-a-kind artists and PFP collectors.
5 Comments
Sounds like they’re trying to keep the NFT train running despite the crypto winter.
NFT marketplaces securing millions in a bear market – innovation or desperation
A bold move, but will it be enough to weather the storm
Keeping the dream alive with a cool $2.5M – will it be enough to pull through the crypto winter and keep users engaged
Impressive they managed to raise funds in this market, but will it be enough to keep users interested in the long run