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How Does OpenSea Make Money (Business and Revenue Model)

The OpenSea business model

How Does OpenSea Make Money?
Here’s what you should know:
  • What is OpenSea, and how does OpenSea work?
  • How does OpenSea make money?
  • Service Fees (Commission Fees)
  • OpenSea’s Subsidiaries, Acquisitions, and Exits
  • OpenSea’s profit and revenue
  • What is the OpenSea business and revenue model?
  • OpenSea’s funding and valuation

How does OpenSea make money if it’s free to use? Here is a full, in-depth, breakdown of their main revenue stream, as well as the OpenSea business model, their profit and revenue, and how OpenSea works.

What is OpenSea, and how does OpenSea work?

OpenSea is the first and largest peer to peer NFT marketplace for discovering, collecting, and selling non-fungible tokens (NFTs).

Founded in 2017 by Devin Finzer and Alex Atallah, OpenSea has handled more than 16 million transactions since launch according to on-chain data, making it the largest NFT marketplace in its space.

How OpenSea works is: Users can browse the OpenSea marketplace without creating a profile account. But, if users (buyers and sellers) wish to interact with the marketplace, such as placing bids or minting NFTs, they’ll need to create and connect to a Web3 wallet such as MetaMask or Coinbase Wallet through their browser. You can read more on how to do that, here.

Some of OpenSea’s competitors include Rarible, LooksRare, Foundation, and other peer to peer NFT marketplaces.

OpenSea App in Apple App Store | OpenSea Business Model | How Does OpenSea Make Money | How Does OpenSea Work
Source: Apple App Store | OpenSea

How does OpenSea make money?

The OpenSea marketplace facilitated over 10 million NFT transactions totaling more than $13.056 billion in transactional volume in 2021 on the Ethereum Network, as reported by dappradar’s raw on-chain data research.

So how does OpenSea make money off of all that transactional volume?

Below is a breakdown of how much money OpenSea makes and its revenue model. Including all revenue streams and how much they charge for their services.

Here is how OpenSea makes money (in 2022):

OpenSea has a revenue model that makes money in just one (1) way – service fees.

#1. Service Fees (Commission Fees)

According to OpenSea, the company makes all of its money through a very simple business model – by collecting a 2.5 percent commission fee on every transaction made on its marketplace from sellers.

As noted above, it was found that OpenSea handled roughly $13.056 billion of transactional volume in 2021. Of which, OpenSea takes a percentage from each of those transactions.

OpenSea Fees:

  • 2.5% of the transaction total
OpenSea Fees | OpenSea Business Model | How Does OpenSea Make Money | How Does OpenSea Work
Source: OpenSea

OpenSea’s Subsidiaries, Acquisitions, and Exits

To date, OpenSea, Inc. has made a total of 2 acquisitions.

OpenSea Acquisitions | How Does OpenSea Make Money
Source: Crunchbase

OpenSea’s profit and revenue

OpenSea has not released any official revenue numbers for how the company performed in 2021.

But, if we take OpenSea’s total reported sales volume of $13.056 billion and divide that by their 2.5 percent service fee, we can estimate OpenSea brought in around roughly $326.4 million of revenue in 2021.

Note: Because OpenSea, Inc. is a privately held company, they are not required to make their annual reporting, such as Form 10-K’s, pubic.

What is the OpenSea business and revenue model?

OpenSea makes money through a few revenue models that they combine within their company, they are:

  • Commission based business model
  • Mergers & acquisitions (M&A) business model

OpenSea’s funding and valuation

According to OpenSea’s Crunchbase profile, OpenSea has raised $427.2 million over 9 rounds and has a valuation of $13.3 billion as of January 2022.