After listing your NFT, you will be required to set up an auction for your digital artwork. For this auction, you can either choose to sell your NFT at a fixed price or set it as a timed auction. A timed auction limits the window for bid offering to a timeframe of your choice. After this timeframe has elapsed, bids will be closed.
Importantly, timed auctions are divided into two. These are
- highest bidder auctions
- declining price auctions
a. Highest Bidder Auctions
Under this form of auction, your NFT is sold to the highest bidder. On marketplaces like OpenSea, the sale will be automatically concluded if the highest bid submitted by a buyer is above 1 ETH. The gas fee will also be paid from this sum. To prevent a situation where you would receive low bids on your NFT, you can set a reserve price. A reserve price is the lowest possible sum that can be submitted as a bid. On OpenSea, a reserve price cannot be lower than 1 ETH. It is important to note that even after setting a reserve price, you can choose to accept bids that are lower than the reserve price.
b. Declining Price Auctions
Under a declining price auction, the price of the NFT decreases within a specified period. For example, if you were to set the price of an NFT at 3 ETH, the price will decline to about 1 ETH if the NFT is not claimed within three days. This auction is majorly available on OpenSea.
To set an auction, click “timed auction” in the “Type” option and proceed to choose whichever form of an auction that you are comfortable with. You can also choose a fixed-price listing from the icon.