OpenSea is the largest NFT marketplace, hosting over 80% of all NFT transactions. As an auction-based platform, OpenSea relies on buyers bidding up the prices of NFTs listed for sale. But what would happen if an NFT listing received no bids during its auction period? Let’s explore the potential outcomes.
The NFT Would Expire Unsold
On OpenSea, NFT auctions typically last for 1, 3, or 5 days. If an NFT fails to receive any bids during the auction time frame, the listing expires. Once expired, the NFT returns to the seller without having been sold. This is the most straightforward result—the NFT simply goes unsold.
For instance, say Alice lists her CryptoKitty NFT named Fluffy for auction with a 1 day listing period. If no one places a bid on Fluffy during that 1 day, the auction expires without Fluffy being purchased. Fluffy then reverts to Alice’s ownership; she retains the NFT as she had it prior to listing.
The Seller Would Have to Relist or Lower the Price
When an NFT auction expires without any bids, this indicates a misalignment between the seller’s expected price and what buyers are willing to pay. The seller likely set the starting bid and/or reserve price too high.
In this case, for the NFT to successfully sell, the seller would need to reassess the market and adjust their price accordingly. They may relist the NFT with a lower starting bid or reserve, or possibly enable “Make Offer” to allow buyers to negotiate a lower price.
Using the Fluffy example again, if Alice’s 1 day auction yielded no bids, she may need to relist Fluffy with a lower minimum bid. For instance, if she originally listed Fluffy for 2 ETH starting bid, dropping it to 0.5 ETH could put the price within reach of interested buyers.
The NFT Could Gain “Rarity” Value
Paradoxically, an NFT failing to sell could potentially increase its perceived value in the future. This depends on the scarcity dynamics of the NFT collection.
If an NFT comes from a collection with fixed supply, an unsold listing can reinforce its rarity. With fewer copies circulating, the NFT effectively becomes “more rare” by not selling. This lends an aura of exclusivity and prestige.
For example, say only 500 copies of the CyberBro NFT exist. If Bob lists his CyberBro for auction but it expires unsold, there are still only 500 CyberBros in circulation. Bob’s unsold NFT could gain value from prospective buyers as a “rare” CyberBro few others own.
The Owner May Choose to Hold Long-Term
For highly speculative NFTs, some owners intentionally list at unrealistically high prices fully expecting their auctions to expire. Their goal is long-term price appreciation.
By listing at prices they know no one will currently pay, these sellers effectively take their NFTs off the market temporarily. They hope to create artificial scarcity to drive up future valuations. Then, they can relist for profit later once demand increases.
This strategy involves the risk that demand never materializes. But for owners bullish on their NFTs, temporary failed auctions can be part of a longer-term holding plan. The owner ties up their speculative NFT now hoping for a big future payday.
The NFT Could Go to a Private Sale
If an NFT fails to garner bids on OpenSea, the seller may explore private sale alternatives. This involves directly negotiating a deal with interested buyers outside the auction marketplace.
Private sales allow sellers to bypass the OpenSea listing process altogether. A private buyer may offer a favorable price despite low marketplace demand. Or the seller could bundle the NFT as part of a larger transaction.
For example, Alice could directly sell Fluffy to her friend Bob for 1 ETH, circumventing the OpenSea auction where Fluffy expired unsold. Private sales open opportunities unavailable within OpenSea’s on-chain auctions.
OpenSea Success Fees Would Not Apply
One small advantage to an NFT expiring unsold on OpenSea is avoiding OpenSea’s success fees. These fees take a cut of the final sale price.
OpenSea charges a 2.5% fee to sellers on all sales. For expired auctions, no sale occurs so OpenSea does not collect any fee. The full listing cost still applies, but successful sale fees do not.
This provides a minor cost savings to sellers. If Fluffy’s auction expired unsold, Alice would pay the listing fee but not owe the 2.5% success fee she would incur had Fluffy sold.
The NFT Could Be Delisted and Removed from OpenSea
After an unsuccessful NFT auction, the seller can delist the NFT from OpenSea by cancelling any future listings. This removes the NFT from sale on OpenSea’s marketplace.
Delisted NFTs no longer appear on OpenSea’s browse pages. However, old listings may still be accessible via direct URL. Delisted NFTs also continue existing on their native blockchain.
But delisting can symbolically distance an NFT from the OpenSea marketplace if the seller wishes. This “clean break” could precede attempts to sell through other channels. Or the owner may simply wish to remove a “failed” listing.
The Seller’s Reputation Could Be Damaged
In rare cases, an expired NFT auction could hurt the seller’s reputation. This depends on their rationale for listing.
If the seller seemed to intentionally list an NFT at an egregiously unmarketable price, observers may view the action as deceptive. Critics may accuse them of “pump and dump” tactics, exploiting hype and misleading buyers.
Such reputational damage is unlikely for typical good faith listings. But perceived intentions matter. An NFT listed and delisted far above true market value could raise suspicions.
Downstream Services May Be Impacted
NFT services like rankings, analytics tools, recommendations, and more depend on transaction activity. An NFT failing to sell can impact visibility.
For example, NFT rankings on OpenSea and other platforms consider total sales and volume. A zero-sale auction could reduce rankings visibility for that NFT and collection.
Likewise, recommendation algorithms see less signal from delisted or expired NFTs. Analytics tools draw fewer insights from NFTs lacking sales data.
While indirect, a failed auction can reduce downstream visibility as services discount unsold and delisted NFTs in their models.
The NFT’s Metadata Could Be Updated
NFT metadata—descriptive attributes encoded into NFTs—can optionally be updated by sellers even after minting. After a failed auction, the seller could revise metadata to “refresh” the NFT.
For example, Alice could update Fluffy’s metadata with new artwork or descriptive info. This essentially gives the NFT a new look and feel. Updated metadata provides an opportunity to reboot unsold NFTs.
Note however that historical metadata is still visible on-chain. Only the current metadata is shown by default on marketplaces.
No Direct Revenue Impact to OpenSea
From a revenue perspective, an NFT auction expiring unsold has minimal direct impact to OpenSea. Their business model relies on transaction fees, not listings.
However, indirect impacts from reduced transaction volume could arise long-term if failed auctions became systemic. This could dampen buyer and seller activity. But isolated incidents have negligible platform revenue impact in the near-term.
Failed auctions predominantly affect sellers through lost sales. OpenSea continues collecting listing fees regardless of auction outcomes.
Could Incentivize Changes to OpenSea’s Model
While no disaster for OpenSea itself, widespread expired auctions could prompt evolutions to their model long-term. Failed listings suggest inefficiency in the NFT marketplace.
For example, OpenSea may look to introduce seller vetting, restricted listings, promoted listings, or buyer guarantees. Algorithmic recommendations could become more personalized and robust.
Large numbers of abandoned auctions signal marketplace friction. OpenSea may tweak its policies or features to better match sellers, buyers, and appropriate listing formats and durations.
Market Perceptions Could Be Impacted
Broader NFT market perceptions could eventually suffer if OpenSea frequently showed listings receiving zero buyer interest. This might dampen enthusiasm and growth.
Limited instances likely have minimal effects on overall market sentiment. But systemic expiration en masse could signal falling demand and shrinking liquidity.
Yet market impacts seem unlikely in the near future. OpenSea continues posting record sales volumes, suggesting strong underlying market interest.
Other NFT Marketplaces Could Benefit
As the leading platform, OpenSea risks losing market share if auctions frequently go unsold. Rival NFT marketplaces may seek to capitalize.
Platforms like Nifty Gateway, SuperRare, Rarible, etc. could attract disenfranchised sellers by touting higher sales rates. Unique model features preventing failed auctions could emerge as competitive differentiators.
However, rivals must also balance lower barriers with preserving exclusive valuations. No easy solutions exist, but competitors may highlight OpenSea’s flaws.
Data Summary
To summarize the potential outcomes if an NFT auction receives no bids on OpenSea:
| Outcome | Summary |
| NFT expires unsold | The NFT returns to the seller with no sale completing |
| Seller relists at lower price | The seller adjusts their price expectations to meet market demand |
| NFT gains “rare” prestige | Scarcity increases as the NFT stays off the market |
| Owner holds NFT long-term | The seller hopes to profit from future price appreciation |
| NFT may sell privately | The seller can directly negotiate deals off OpenSea’s platform |
| No OpenSea success fees apply | The seller avoids the 2.5% fee on sales above $100 |
| NFT could be delisted | The seller removes the NFT from OpenSea listings |
| Potential reputation damage | Listing far above market could seem deceptive |
| Impacts downstream services | Rankings, analytics, and visibility may decline |
| Metadata may be updated | The NFT gets refreshed with new attributes |
| Minimal revenue impact to OpenSea | OpenSea’s fees come from transactions, not listings |
| Could spur OpenSea model changes | Failed auctions may prompt marketplace evolutions |
| Could hamper market sentiment | Widespread expiration may signal declining demand |
| Competitors may attract sellers | Rival platforms can capitalize on OpenSea’s flawed model |
Conclusion
On the surface, an NFT auction expiring with zero bids may seem like a non-event. But many potential impacts can arise downstream. Sellers may adjust strategies, holders play long games, and OpenSea itself considers changes. Failed listings provide signals about market dynamics.
Most effects represent short-term friction and shuffling. But systemic issues could hamper sentiment and growth if auctions routinely go unsold. For now, expired listings appear an isolated byproduct of OpenSea’s soaring volume. But bears watching as the space evolves.