NFT auctions are the most popular way to buy and sell NFTs on the online market today. During these events, the seller sets the starting price and time frame for the sale. Then, interested buyers place bids until a winner is chosen. How long this will take largely depends on how long the NFT auction will last.
A typical NFT auction lasts about 24 hours before the seller must pick a buyer. However, the duration of an auction can vary between the auction host, the needs of the seller, and a few other parameters. Some auction sites will even extend them indefinitely as long as the NFT receives new bids.
By reading further, you will learn all the parameters that define the length of an NFT auction. You will also learn valuable strategies you can use to ensure success for your next auction, no matter how long it takes. Plus, I will include the types of auctions that the top online NFT platforms use.
And I need to say that we will only be talking about online auctions from NFT platforms like Rarible and OpenSeas, not auction houses like Sotheby’s or Christie’s, even though they have hosted some impressive NFT auctions for famous artists, like Beeple.
The Average Duration of an NFT Auction
Auctions were the first things to go digital; thanks, eBay! Could you imagine if Amazon got involved with NFTs?
Online auctions were also the first way to buy and sell NFTs. As such, there are regular NFT auctions on numerous different cryptocurrency blockchains like Ethereum, Polygon, Tezos, and Flow.
While some of these auctions will receive no bids, they remain popular among NFT creators for several reasons:
- Simplicity – Auctions only run for a set time established by the seller or the NFT platform, bids are recorded and tallied automatically.
- Reliability – Auctions are streamlined processes.
- Familiarity – Timed auctions have a literal count down so you know when to get a bid in.
NFT auctions are so simple and reliable that they are a part of the culture, and even now, people can use their credit cards to get involved. Everyone knows and understands how they function, reducing the “knowledge cost of entry” for many NFT creators.
Simple Steps To Get Involved with NFT Auctions
If you’re ready to rock and roll and get plugged into the NFT auction system, these are the basic steps to follow:
- Sig Up to an NFT Platform like Rarible or OpenSea
- Get a Crypto Wallet and Connect it to the NFT Platform (be sure to exchange your fiat money into to Ethereum or the compatable crypto)
- Make some digital art, music, or a collection of collectables
- Mint your digital creation on the platform (this may cost crypto for the gas fees)
- List your creation for sale or set up an auction
- When and if your creation sells the NFT platform will handle the transfer of crypto and your NFT to the wallet of the buyer
If those simple steps make sense and you’re ready to start minting, I’m going to highly suggest you read these articles so you know how to either save money or defer money when you mint your creations:
- How To Sell NFTs Without Gas Fees (or less) | Complete Guide
- The 3 Cheapest Ways to Mint an NFT: Full Breakdown
How NFT Auctions Work…Generally!
Most NFT auctions are initiated by the sellers. Sellers can usually select the starting price and the duration of the auction. Depending on the NFT marketplace, the seller can set the term to:
- 24 hours
- 72 hours
- 5 days
- 7 days
Once the seller sets all the parameters and begins the auctions, the marketplace will list and accept bids for the established duration.
If no bids come in, the NFT auction will just end once the duration expires. The seller then has the option to create a new auction or try to sell the NFT through a different means.
Tip: sometimes, you can find NFTs listed for “0.00” or even creators that give them away on OpenSeas.
If bidders do come for the auction, the auction follows the standard rules for auctions. Each bidder can try to outbid the previous bidder until the auction ends. Afterward, the seller offers the NFT to the highest bidder.
Most markets automatically apply a grace period after the last bid so that other bidders can respond. While it works for all bids, the policy generally does not come into effect until the last 6 hours of the auction, where it can effectively extend the auction beyond its set deadline.
This grace period can vary between marketplaces, but most places set it to 10 or 15 minutes.
Because of this grace period, NFT auctions will last until about 15 minutes after the last bid or the established deadline, whichever is longer.
If you won and already paid for the NFT, it may take a little time for the transfer to take place. I discuss transfer times here.
Alternative NFT Auction Formats
The above rules only apply to the regular increasing-price NFT auctions. However, this type of auction is not the only one available to sellers.
Each type of auction has its own rules and duration, making them suitable for specific types of situations and NFTs.
Fixed Price Sale
Fixed-price auctions are not auctions at all. The seller sets a permanent price for the sale. Buyers then have a set amount of time to bid on the NFT on a first-come, first-served basis.
NFT fixed price sales have the advantage of having a consistent, easy-to-understand, predictable profit margin and work best for resalable NFTs. Either way, these auctions can last anywhere from an hour to a few weeks.
Looking for tips on how to price your NFTs? This shows you how: How Much Should You Sell Your NFT Art For? Pricing Guide.
No Reserve Auction
In a no reserved auction, the seller leaves the initial bid price blank. Perfect for new sellers, these auctions let buyers pay want they want, as low as a cent, for the NFT.
This lets the market find the true value of an NFT by attracting more buyers than a standard auction. The sellers determine how long these auctions will last.
If you expect to make a profit, you better have your marketing in place; otherwise, you could be losing some serious crypto from the gas fees you just spent to mint your NFT. Follow this NFT marketing guide for tips and tricks.
Decreasing Price Auction
During a descending price auction, the bid price drops every few days it is on the market. These auctions end once a bidder steps forth and pays the current price.
Sellers like these auctions as they generally end with a sell. Decreasing price auctions will last as long as the seller maintains them as each price change renews the auction.
Auction Types from Popular NFT Marketplaces
These are some of the most popular platforms in existence today. In fact, if you are just starting out, I recommend one of these as they are easy to use and have good reputations.
- OpenSea – Highest Bidder Auction and Decling Price Auction.
- Rarible – Highest Bider Auction
- Mintable – Highest Bidder Auction (12 hour, 24 hour or 2, 3, and 7 days) and “Buy Now” Auction
- Foundation – 24 hour reserve auction. Seller sets reserve amount and auction begins at time of first bid that accepts resever amount.
Auction Platform Fees
Each platform has different selling fees. I mean, that’s how they keep the lights on. Some of the fees you can expect are listing fees, selling fees, and transfer fees. Gas Fees go to the blockchain miners.
According to Mintable, “In simple terms, they (miners) exchange their computing resources that run the blockchain for a small fee (coins). This is where the cost portion comes into play in blockchains. The gas fees that we pay for every transaction go to these miners in exchange for their services of facilitating that transaction.”
Typically you will see selling fees that are based on the selling price of the NFT. For example, both Rarible and OpenSea have a 2.5% selling fee.
Just be sure to complete your due diligence and understand all fees associated with the transaction.
Getting the Best Value from an NFT Auction
Getting the most value from an NFT auction comes from choosing the right price, type of auction, and auction duration. This works for both buyers and sellers.
For instance, while you usually see the more valuable NFTs on standard auctions, you may find a few hidden gems from a no reserve auction.
If you do try your luck with a traditional auction, you must make sure that you are the highest bidder. Most marketplaces will warn you of your bid status on your account dashboard, making it easy to track this information.
The initial offer must be placed within 24 hours from the start of the auction and must at least match the reserved price set by the seller. Generally, all other bids must be at least 10 percent or 0.1 ETH more than the previous high bid.
Once the NFT auction ends, you must return to the page to see if you won or not. If you won, you would see a “Claim” button on the page.
The market will issue the NFT to your wallet once the seller receives payment, which will get processed once the blockchain validates the transaction. It’s super easy.
For NFT Sellers
Sellers get to watch their auctions in near real-time. The marketplace will record each bid in the auctions “History” section along with time extensions. The seller will also receive this information by email if one was provided.
Conclusion
NFT auctions are the primary way NFTs are sold on the market. These auctions follow the same rules as offline auctions except that everything is handled automatically and digitally.
They also last as long as they are configured by the sellers or platform. Most of the time, this will be a day plus any grace period for last-minute bids but can last for a week or longer, depending on the type of auction.
If you’re intrigued with NFTs and this new culture, then you are going to want to dive into one of these viral articles:
- What is the Average Cost to Mint and Sell an NFT? (Top Marketplace Examples)
- Can You Sell Fan Art as NFTs?
- Can You Get Sued for Screenshotting an NFT?