Many NFT projects use whitelists to give their customers a chance to mint tokens before any other individual. The advantage of these whitelists is that the members mint at significantly reduced prices and have a higher chance of obtaining rare tokens.
Despite the idea of whitelisting being relatively simple, it is very much likely that it will be challenging for those who are beginners in the NFT space. So, in this article, we will elucidate what whitelists mean, their role in a project, and how you might be whitelisted in the future. Let’s dive in.
What is Whitelisting in NFT?
As are as Information Technology and Cyberspace security are concerned, whitelisting is a process where certain parties are approved while others are excluded. Whitelisting in NFT also shares the same base principles.
However, in NFT, digital wallet addresses are used instead of online identification forms. In this sense, an NFT whitelist is a list containing several crypto wallet addresses that have been allowed to mine tokens before all other addresses. Since these lists are generated using a smart contract, only approved wallets are allowed to mint tokens for a particular amount of time.
Today, many projects in NFT are based on the ETH blockchain; therefore, an ETH wallet address is paramount for whitelisting. Solana and Cardano are among other cryptocurrencies blockchain that are joining NFT projects.
Application of NFT whitelists
Development teams in several NFT projects use whitelisting to popularize their projects and onsite a feeling of community to catapult themselves into the market. The other use of whitelisting is to avoid congestion when the NFTs land.
Boost Commual Engagement
By adding some of its loyal members to a whitelist, the project can appreciate them and, at the same, popularize the project via the various social platforms online, articles, and blog posts on the net.
There are dozens of NFT projects in the market today; thus, selling yourself well is vital. Encouraging members to popularize the project with the promise of being whitelisted is a win-win situation for both parties. Typically, each project has its own rules to be followed and conditions to be met to be whitelisted.
Minimise Congestion
Regular congestion in the blockchain causes the fees to surge significantly. At the moment, the fees for ETH are already averagely high, and thus if all the members tried to mint tokens once, there would be severe congestion in the severs of the blockchain that would result in a spike in the fees. Therefore, whitelisting allows the project to deliver NFTs in parts. This way, not everyone will rush to mint tokens once they drop.
Advantages of Whitelisting
There are several reasons why most projects in the NFT sector are encouraged to whitelist. The main advantages of Whitelisting include;
- Appreciate the first members by giving them a communal feeling
- Popularise the NFT project
- It aids in appreciating the tokens’ value
- Give minting freedom to members
- Prevent fee spikes caused by network congestion.
Conclusion
The simplest way to get on a white list is by identifying a new NFT project and strictly adhering to their whitelisting instructions. So far, 2022 seems to be a critical year for the NFTs projects. Hence getting yourself on a whitelist is exceptionally crucial. With regular spikes in fees being witnessed regularly due to congestion, it is possible to save a load of cash and, at the same time, mint a rare NFT when on a whitelist.
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Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
