A new plan for nonfungible tokens (NFTs) has emerged, which is a major selling point for Solana (SOL) ecosystem. Offering low fees for NFTs caused the Solana network to be preferred over Ethereum, where gas fees are high. However, financing is an essential part of business survival in such an agile and competitive industry. This explains why the dominant Solana NFT protocol Metaplex introduces a controversial network fee in its “Token Metadata immutability scheme”.
Solana’s Token Metadata immutability plan backfires
The Solana Token Metadata immutability plan has sparked angry reactions from the community, and they have called for a “fork” while expressing their displeasure. In response, Metaplex backed out from its initial plans by eliminating some of the proposed fees. The company said in a Twitter post that updates and verifications will remain free because the costs “could hinder important and urgent use cases.”
Metaplex sprouted from Solana Labs with an estimated $46 million raise, which is estimated to be the third-largest increase from an individual project in the Solana ecosystem. According to a company blog post, nearly all Solana NFTs have adopted the Metaplex standard, but now they’re integrating fees on top of it and inspiring fork considerations among community members. It should be noted, however, that this will not be a viable solution. Because Metaplex’s fee problem is difficult to solve. Because it has a license that says “It is open source, but cannot be forked”.
Note, however, that a wide variety of NFTs now use it, and even exchanges and wallets have adopted it. This makes developing and maintaining code a daunting task and shows that the company may need some fees to maintain a viable business model. According to the company, revenue from developer fees will go to fund development on the Token Metadata roadmap and broader suite of Metaplex programs, including development tools such as Candy Machine, Auction House, Compressed NFTs and SDKs, Amman, Umi, Solita.
5/ It is also important to note, Create fees don’t apply to Compressed NFTs which are minted through a separate program, Bubblegum, that drastically reduces the cost to mint millions of NFTs and unlocks new use cases for the ecosystem
— Metaplex 🦾 (@metaplex) May 25, 2023
Fees as a barrier to development push developers to Ethereum
The lack of protocol standards such as Ethereum’s ERC-20 and ERC-21 is among Solana’s biggest shortcomings. This means that the program is solely a product of Metaplex and will work to its standard. According to industry experts, the introduction of fees could hinder the development of NFT, thereby reducing user interest in the wider Solana ecosystem. Adding a layer of taxation on top of that can infuriate users.
However, Solana also has its perks, including its speed. Despite this, Ethereum’s mainnet development is much slower than Solana’s layer-2 (L2) development, making it low-cost. Also, ETH cryptocoin.com As we have also reported, it offers rapidly developing solutions. This allows Ethereum to innovate quickly without having to do this at the protocol level.
