The Evolution of NFT Allowlists and Presale Minting

The Evolution of NFT Allowlists and Presale Minting

byCorporate Trash

2/9/2022

As NFTs have increased in popularity, so has the demand for minting NFTs. After an in-demand NFT mints, it can sell on the secondary market for a premium, leading NFT collectors to go to drastic measures to mint. As more NFT projects build massive hype before their launch, the concept of NFT allowlists — often known as NFT whitelists — have never been more popular.

NFT projects use allowlists to determine who can mint an NFT project before minting opens to the general public. If you’re chosen for the allowlist and submit your wallet address, you will be able to mint your NFTs without worrying about gas wars.

Over the past year, we have seen a dramatic difference in how NFT projects are launched and marketed, including in their allowlists for minting. But getting your wallet address on the allowlist has also never been more time-consuming for those trying to get a spot on one.

If you’re an NFT beginner, we’ll give you insight into how allowlists started, and how to get onto one of these allowlists.

NFT Minting Methods Before Allowlists

Bonding Curves

When NFT projects gained more popularity and traction in early 2021, many projects used a “bonding curve” for their mint, including Apymon, Voxies, and VoxoDeus. A bonding curve means that the price is lower in the beginning for early buyers, but the more they are minted, the price to mint goes up.

The argument for a bonding curve is that by increasing the mint price each time new NFTs are minted, creating new NFTs will increase the NFT’s price on the secondary market. Devs could be more incentivized to create and innovate on the project, since the revenue from primary sales are likely more than secondary sales.

NFT bonding curve minting
Bonding curve example for NFT minting. As minted supply increases, price to mint increases.

However, over time the bonding curve minting approach began to lose favor with NFT collectors, being labeled as a “ponzi” even by then-newcomer Bored Ape Yacht Club. Collectors saw bonding curves as unfair to those to happened to discover the collection later. Many collections who continued to launch with this method were eventually forced to switch over to a fixed-price drop method.

Fixed-Price NFT Drops

The fixed-price drop method is simple, and is still seen in many NFT projects today. Every single NFT in the supply is priced the exact same price, from the first minted to last. Prices can be as cheap as zero Ethereum (plus gas) and as high as the collection makes it.

Fixed-price drops can be stealth (unannounced) or scheduled ahead of time. If scheduled, this can cause issues with bots and gas wars, and projects can sometimes mint out within minutes. These gas wars for the most hyped NFT drops could add over 1Ξ to the mint price just in gas.

After sellout, collectors rush to secondary marketplaces to try their luck purchasing there. Often, projects with a allowlist will transition to a public fixed-price drop after a set period of time for the allowlist to mint their NFTs.

Dutch Auction

A dutch auction is when there is a finite supply of tokens, but they start at a certain price and steadily decrease in price over a period time. After facing intense gas wars with their previous drop method, Art Blocks moved over to the dutch auction method for minting in 2021.

For example: an NFT can be priced at 1 Ethereum and decline one percent in price every 10 minutes, until it reaches 0.1 Ethereum. Wherever it mints out is where it mints out, whether it’s at 1, 0.1, or somewhere in between.

The Beginning of NFT Allowlists

Later in 2021, there were many more NFT projects than ever before. Competing against the massive number of upcoming projects was more crucial than ever. Marketing your NFT project to stand out amongst the crowd became more of a focus, and protecting your community against gas wars was key as well.

The concept of an allowlist is similar to an exclusive pre-sale. People who are interested in the project before it mints are put on a special list that guarantees them a minting opportunity, sometimes for a reduced price. This is done before the public sale.

A certain amount of NFTs are usually reserved for the allowlist, and everything left over becomes available for the public, which normally becomes a high gas war, if the project is in-demand.

How to Get on an NFT Allowlist

Allowlist members can be early adopters, NFT holders, giveaway winners, people who complete a certain series of tasks, or just someone who enters their wallet address somewhere in time.

Oftentimes, Discord moderators will seek out the most active and creative participants in their community and manually put them on the allowlist. Other times, allowlist spots will be raffled off in collaboration with other NFT projects.

Once their wallet address is placed on the allowlist, they have a reserved mint for a period of time for that project, from that wallet.

Early NFT Allowlists

Tom Sachs Rocket Factory announced a mint in early August 2021 where owners of another NFT in his collection could mint 10 minutes early.

One of the earliest projects to adopt a true allowlist was 0N1Force in mid-August 2021, which grew their Discord community exponentially before the public sale. Joining the community was one of the only ways to have a chance at the allowlist, leading to lots of engagement before the NFT was even released.

Shortly after 0N1 Force, Mekaverse was set to release its collection. To determine who could mint their project, people who submitted their wallet address before a set date were put into a raffle for a spot to mint their Mekaverse. The had to meet certain requirements to enter the raffle, in an effort to prevent any individual from entering several wallets.

NFT Allowlists Today

Getting onto NFT allowlists has morphed into a full-time job for some people — and it can certainly pay-off if you’re able to get on allowlists for coveted NFT projects.

In many cases, it’s no longer a case of being early in a project’s Discord or retweeting a tweet. Some require multiple steps over a long period of time, and requires consistent attention to the Discord. The NFT community calls this “grinding” for an allowlist spot, a task which some larger NFT collectors have actually outsourced to others to save time.

To make matters more confusing, on some projects, there isn’t just an allowlist, but an allowlist for a mint pass, which you can then exchange for the NFT. There can also be multiple levels of allowlists, or sometimes a project is just all allowlist and no public sale. The complexity is frustrating for many collectors, especially ones who are new and looking for a chance to mint and work their way up.

There has been massive buzz for a project called Invisible Friends, which is requiring owning two other NFTs in their other collections to gain an allowlist spot for it. It even launched merch before their NFT goes on sale, with an allowlist raffle for merch buyers. There is no telling what price the actual NFT will have once it comes out, but NFT collectors are going to great lengths to be able to mint an Invisible Friends after months of hype.

The NFT game Wizards and Dragons kept new Discord members in a sort of chaotic “prison” where they had to type the command “!guard” hundreds of times until access was unlocked for allowlist.

For NBA Top Shot, there is a Nine Lives Lounge community for holders of the entire Cool Cats Top Shot set. They were amongst the first to receive access to the closed beta of NFL All Day, thus incentivizing holding of the Cool Cats set.

Many projects like Doodles, Ghxsts, Cool Cats, and Deadfellaz partner with communities for allowlist giveaways. Upcoming projects collaborate with these high-end projects, and holders of the high-end projects are designated a certain number of allowlist spots that are typically raffled off within the community.

While this trend is great for people who hold these high-end NFTs to gain minting opportunities, many argue it lets the “rich get richer” while not allowing opportunities for people new to the NFT space.

Tips for Getting on Allowlists

Every day there are new innovations for getting on project allowlists. The best way to find out about new NFT projects are to join a trusted Discord community of your peers in the space. Many will have dedicated channels for upcoming launches and sometimes even allowlists.

Holding an NFT from a community which does lots of collaborations with other communities is a good way to have a chance at an allowlist spot giveaway.

You can also find allowlist opportunities on Twitter by “interacting” with some tweets, but please do your own research to make sure they are legitimate. Joining project Discords early is a good idea– the tough part is to keep tabs on all the allowlist opportunities that arise.

Like anything else in the NFT space, those who participate and contribute often are usually rewarded.

TLDR on NFT Allowlists

There has been an evolution of allowlists in the NFT space from early 2021 through today. As collections began to consider how to reduce gas wars, reward early adopters, collaborate with like-minded communities, and stand out in the crowd, allowlists became more commonplace than ever.

While finding and getting a spot on a popular project allowlist can seem like a full-time job, you can utilize your NFT community to suss out which allowlists may be worth the grind and which ones probably aren’t.

In 2022 and beyond, we will likely continue to see innovative allowlist and minting methods as the NFT space grows. As always, MomentRanks has our ear to the ground to help you learn and navigate this wild world of NFTs.

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