Coinbase NFT/Mastercard Deal Reopens Decentralization Debate

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  • The new Coinbase NFT/Mastercard deal has caught the ire of fans of decentralization
  • They argue that the NFT world will become too centralized if Coinbase gets a stranglehold
  • They need to remember that most newcomers want simplicity over decentralization

The news that Coinbase and Mastercard have signed a deal to allow Mastercard holders to buy NFTs direct from Coinbase’s forthcoming platform has stirred up the argument over decentralization of the NFT space. However, proponents of decentralization need to realize that unless the entry level to the entire crypto space is reduced, mainstream adoption simply will not happen, and deals like this can act as a gateway into crypto.

Purists Are Blind to the Reality of Adoption

Mastercard announced this week that cardholders will be able to buy NFTs from Coinbase NFT as easily as buying groceries online. This was met with a frosty response from some, who argued that inserting centralized third parties into the deal is the opposite of what crypto is supposed to be about, but they are blind to the reality.

Currently, someone wanting to buy an NFT from OpenSea, the most popular NFT marketplace, needs to sign up to an exchange, buy some ETH, create a MetaMask wallet (other wallets are available), send the ETH there and connect it to OpenSea, and then go through the clunky multi-step purchasing process…which they then have to do again if they want to sell it.

All this of course currently comes with ridiculous ETH fees, meaning any profit they make is potentially negated by the fees. This is a very time consuming and potentially expensive learning curve.

Decentralized Schmentralized

While this method may adhere to the ideals of decentralization, purists need to realize that most people don’t care about their NFT experience being decentralized – they just want to take part. Love it or hate it, Coinbase is very good at onboarding new users, who need a small number of simple steps to get started, rather than a long winded, multi step process that may or may not work.

Once they’re in the space, these new users can start learning about decentralization and all its benefits. If they want they can take their NFT experience to the likes of OpenSea and Rarible afterwards, but they are going to be put off at once if that is the first place they try.

If we really want the NFT space, and the crypto space in general, to go mainstream then it has to be easy, quick, and cheap. Currently the NFT space is failing on two of those fronts, and until the decentralized way of doing things is as easy as buying an NFT with your Mastercard from Coinbase then it will continue to do so.