Gem, an Ethereum NFT marketplace aggregator that lets collectors buy assets in bulk across multiple platforms, has been acquired by OpenSea—the top NFT marketplace by trading volume.
OpenSea announced the move this morning, with CEO and co-founder Devin Finzer writing in a blog post that adding Gem is a part of a push towards serving more advanced NFT buyers.
“As the NFT community grows, we’ve recognized a need to better serve more experienced, ‘pro’ users, and offer more flexibility and choice to people at every level of experience,” wrote Finzer.
Gem is a single platform that connects to various NFT marketplaces, including OpenSea, LooksRare, and Rarible, and lets users purchase assets from any of them in a single transaction. That can add to potentially sizable savings on fees. Gem also integrates rarity rankings for NFT collections, such as with the traits in profile picture collections (like the Bored Ape Yacht Club).
An NFT serves as a blockchain-backed proof of ownership for a digital item, and is often used for things like profile picture collections, digital illustrations, sports collectibles, and video game items. The overall market surged to $25 billion worth of trading volume in 2021.
According to Finzer’s post, Gem will continue operating independently as it expands its platform and adds more features, and then some of that functionality will be brought to OpenSea’s own platform in the future.
Finzer also acknowledged the allegations against a co-founder of Gem who goes by the name Neso, which BuzzFeed recently reported was a pseudonym used by Josh Thompson, once a popular video game streamer who went by MethodJosh. Thompson had been accused of rape and sexual harassment in 2020 before he effectively disappeared from the internet. He was removed from Gem earlier this month.
“During the course of our diligence, we learned about, and immediately surfaced, some deeply concerning allegations against a now-former member of Gem’s leadership team who operated under the pseudonym Neso,” Finzer wrote. “Upon investigating the allegations, the employee was immediately exited prior to the close of this deal. This individual has never and will never be affiliated with OpenSea.”
What is Gem?
Gem is similar to Genie, another NFT marketplace aggregator that specializes in bulk buying—particularly “floor sweeps,” or when someone buys up a bunch of the lowest-priced NFTs available in a certain NFT collection. Decrypt highlighted Genie and the building momentum around the service in January.
However, Gem—which itself only launched in January—has apparently taken the lead of late. Earlier this month, analytics platform DappRadar highlighted that Gem was processing about 10 times the number of transactions and total trading volume as Genie. The report noted that Gem supports LooksRare and lets users still earn LOOKS reward tokens for trading via Gem. Since the publication of that report, Genie has also added the ability to claim LOOKS tokens via purchases through its platform.
LooksRare is an NFT marketplace that provides substantial rewards to users for listing and trading NFTs, as well as staking their tokens, but that approach has also led to billions of dollars’ worth of “wash trading,” or selling NFTs back and forth between the same wallets at vastly inflated sums.
Earlier this month, analytics firm CryptoSlam estimated that about 95% of LooksRare trading volume—about $18 billion worth at that point—was manipulated by users for rewards.
Genie might be plotting its own unique response to Gem’s recent rise, not to mention its new parent company. Today, following the OpenSea announcement, Genie founder Scott Gray tweeted “$GENIE”—a tease suggesting a potential token launch ahead for the platform.
OpenSea’s move comes at a time of increasing competition in the NFT space. It’s still the biggest player in the market by a sizable margin, generating billions of dollars’ worth of organic trading volume, but notable rivals—including the newly-launched Coinbase NFT, upcoming NFT.com, and ever-expanding Rarible—aim to undercut its first-mover advantage.