Open Edition vs. Limited Edition NFTs

Key Takeaways

• Open edition NFTs allow for an unlimited number of NFTs to be minted by collectors or members of the NFT project's community. An open edition NFT aims to reach as many people as possible and is usually set at a low minting price to lower the price barrier.

• Limited edition NFT projects issue a specific number of NFT art or media, where only the predetermined amount can be minted, thus driving the value up through rarity. 

• Open and limited edition NFTs describe the distribution strategy for an NFT. An NFT project can adopt any of these strategies for the distribution of its associated art or media.

NFTs are gaining steam again. A number of NFT projects have seen their floor prices rise, as the market recovers from the crypto winter. Besides famous names like Bored Ape Yacht Club (BAYC), CryptoPunks, and Pudgy Penguins, there’s also been a spike of interest in open edition NFTs.

After all, the accessibility of these collections, with low prices and no caps on the amount of art pieces that can be purchased within the sale window, is attractive to collectors, while offering newcomers a low entry point to the NFT market. Combined with game theory and FOMO over potential future opportunities, open edition NFTs are taking off.

What Is An Open Edition NFT?

For NFT projects that have gained popularity, or NFT projects run by famous artists or mainstream creators, a new drop is usually a significant event in the NFT space. One example is the upcoming NFT drop by Gucci. Due to the reputation of the issuing team, the NFT has already gained a huge demand before it even hit the marketplace, even in the face of a complex list of requirements to receive a mint pass (limited to 5,000).

On the other hand, there are open edition NFTs, which adopt an open approach to the NFT’s availability. A few examples include the Checks VV NFTs by Jack Butcher, “MON3Y PR1NT3R” by Alex Ness, and Snoop Dogg’s “Behind the Music."

Open edition NFTs are open in terms of supply and distribution. They have no set limits on the number of art piece (or digital signatures for multimedia) that can be minted by the collectors. Every collector that participates in the minting event can mint as many NFTs as they wish (or can afford). 

In the majority of open edition NFTs, the only set limit is the minting period. The duration of the NFT minting event is set to a time interval (say 24hrs from the start of minting), during which any number of NFTs can be minted. When this set time elapses, the minting event ends and the number of NFTs minted by the collectors becomes the total supply for the collection.

The rarity of the collection and its art is decided by the number of collectors who participated in the event and the amount of art they minted.

Most open edition NFT projects also remove a significant participation barrier by not whitelisting participants for the minting event. The usual procedure is to share links to the minting portal with the general NFT community and even beyond, enabling any interested collector to mint during the event.

Open Edition NFTs vs. Free Mints

Open edition NFTs might be mistaken for free mints, but both terms are very different. Free mints are NFTs issued for free, where collectors participating in the minting event can obtain the NFT at no cost and the only fee paid is the gas fee for the minting transaction. To gain access to free mints, users usually have to meet certain requirements.

While open edition NFTs can also be free mints, they are usually priced at affordable rates without complex requirements in order to meet the goal of reaching as many collectors as possible.  

Open Edition NFTs and the ERC-1155 Multi-Token Standard

Open edition NFTs follow the ERC-1155 multi-token standard instead of the usual ERC-721 standard used by NFTs.

The ERC-1155 smart contract standard was introduced and developed by the Enjin team as part of the EIP-1155 proposal. ERC-1155 defines a unique multi-functional smart contract standard that allows the creation of ERC-20 and ERC-721 tokens in one contract. With its “single contract for everything” design, an ERC-155 smart contract supports the creation of fungible, non-fungible, and semi-fungible tokens and multiple non-fungible tokens without writing a new contract each time.

Basically, when used in open edition NFT minting, the art pieces minted by the collectors are mapped to one contract, instead of developing a new contract for every mint. Prior to the introduction of the ERC-1155 smart contract standard, developers would need to write a new contract if they wish to create a new type of smart contract token or another variant of the smart contract standard token they already created. The ERC-1155 smart contract standard also supports a few extra features like batch transfer of tokens and an easy-to-develop atomic swap. 

Beyond open edition NFTs, the ERC-1155 token standard was originally designed for GameFi developers who wish to issue NFT and  ERC-20 cryptocurrencies in their games. Using this standard, the developer saves time on writing new contracts and the cost of minting new tokens for their projects.

What is a Limited Edition NFT?

Limited edition NFTs thrive on scarcity, where only a limited number of pieces are available.  Once the predetermined number of NFTs are minted, any collector who was unable to mint an NFT will have to resort to the resale marketplace. 

Most famous NFT projects are Limited Edition, such as the BAYC NFT collection, which is limited to 10,000 pieces of art featuring bored apes. These limited edition projects may also offer unique artwork, where each NFT is algorithmically created based on a variety of attributes, ranging from expressions, clothing, accessories, and more. 

Even though open edition NFTs are growing in popularity, limited edition NFTs are more pronounced in the NFT space. After all, collectors have a preference for rare art, and limited NFTs with low supply are attractive to collectors who enjoy exclusivity.

A good percentage of limited edition NFTs are of the ERC-721 smart contract standard.

What are ERC-721 Smart Contracts?

ERC-721 describes a smart contract standard for creating non-fungible tokens, where no more than one token can be issued under its contract. The ERC-721 smart contract was proposed by Willian Entriken and Dieter Shirley on the EIP-721. Each ERC-721 token is identified by a unique ID and can be issued as a representation or real asset or as a digital signature for arts, multimedia, or intellectual properties.

ERC-721 smart contract standard is suited for limited edition NFTs, where the creator can issue the token as a 1/1 drop. Minting art in the collection will require a unique identifier in the contract. ERC-721 is one of the earliest NFT smart contract standards and is still dominant in the space.

The absence of a multiple smart contract support system is the major difference between ERC-1155 and ERC-721 smart contract standards. While an ERC-721 smart contract token can be created alongside an ERC-1155 in a smart contract, the reverse is currently not possible.

Rise of Open Edition NFTs: Are They Worth It? 

Open edition NFTs have revived the quiet NFT market. In January 2023, Jack Butcher’s Checks VV NFT had over 16,000 pieces of art minted during the open minting event, where each piece was minted for $8. Checks VV NFT’s story is one of the most popular in the NFT space in the past few months. Since its launch, prices for Checks VV have risen to over $2,000, and its success is driving profit-seeking collectors to open edition NFTs as they search for the next big thing. While it’s been the cause of much of the current buzz around open edition NFTs, they have been around as early as 2021.

Other open edition NFTs have benefited from this wave. Vincent Van Dough’s Pepe meme-themed version of the Checks NFT has sold over 230,000 pieces of art as open edition NFTs. Other notable open edition NFTs include Snoop Dogg’s Behind the Music NFT drop on Sound.xyz, raising over 40 ETH in mints. Alex Ness’ “MON3Y PR1NT3R” open edition NFT also sold over 20,000 copies at about $100 each in late January 2023.

Ultimately, open edition NFTs offer more collectors the chance to own artworks at affordable prices, although that may come at the cost of value appreciation. However, at the moment, drops, especially those from reputable artists, are still profitable for buyers, so the open edition NFT wave is likely to continue for the moment. In the next section, we'll look more closely at the advantages and disadvantages of open edition NFTs, although these may change as open edition NFTs continue to evolve.

Pros of Open Edition NFTs

Flexible Distribution Scheme

NFT creators releasing a limited edition NFT will need to determine the number of tokens to mint. This process requires considering factors such as their reputation, the time taken to produce the art or media they are releasing, and how they intend to drive traffic and hype for the minting event. 

For open edition NFTs, the artist can simply drop the NFT minting event plan and let the community mint as they like during the minting period. The distribution spread is freely determined and the creator can save the time spent on preliminary release calculations without worrying about overproduction (or underproduction).

Broadening the Collector Base

In the absence of a whitelisting program and every other protocol usually followed by limited NFT creators, an open edition NFT drop is more likely to reach a diverse community of collectors and even non-NFT investors. The nature of an open edition makes it possible for anyone to discover a minting event and (potentially) proceeding to mint a few NFTs, be it whether they see it as an investment opportunity or just because they like the art and concept. 

Profitability

Some challenges facing the profitability of open edition NFTs include artists setting the price low to allow many collectors to join the minting event, and also the probability of the event not attracting many investors, both of which may subsequently impact the price of the artist's future collections.

However, this is not necessarily true. As always, it depends on the creator and the popularity of the release. An open minting event from a reputable creator, combined with low prices can influence widespread participation, will likely lead to an overall high profile minting event. Some creators also implement game theory into their open edition NFTs, such as Checks VV, where the supply of NFTs can change depending on the decision of their holders. 

Most NFT collections are static. Checks VV is different. More than just art, it's a coordination game that changes rarity and burns supply.

🧵Checks VV 🔥, game theory, & NFT mints going forward @jackbutcher @visualizevalue pic.twitter.com/mD9rTbDUIS

— Louis (@lou_markets) February 14, 2023

Supporting Charitable Causes

As open edition NFTs don’t have a limit on the number of mints, charity organizations can adopt this concept as a way to raise funds, while rewarding donors. Each volunteer mints an NFT and pays the fee which is collated and regarded as a donation. However, before donating to causes through open edition NFTs, remember to do your due diligence on the NFT creator and how they intend to transfer the donations to the beneficiaries.

Disadvantages of Open Edition NFTs

More Suited for Popular Artists

Dropping a successful open edition NFT is more likely when the creator has already gained fame and a good reputation in the NFT space and beyond. If this is not the case, the creator risks losses due to few collectors minting the NFT and being unable to dilute the low prices set for the art. 

Unpredictability

The resale value of an Open Edition is hard to determine before the end of the minting event. This is because the number of NFTs in supply is unknown until the minting is over. In cases where many collectors participate and an unsustainable number of NFTs are minted, collectors may struggle to find a buyer for their art. 

How to Mint an Open Edition NFT

NFT minting platforms like Manifold delineate steps for creators to program the smart contract for their NFTs without having to code. An advantage of platforms like Manifold is that the creator retains full ownership of the minted asset. This is unlike platforms like OpenSea, where the NFTs are minted into the platform’s own contract. Minting platforms allow creators to set up automated minting and also define the minting limits. 

For collectors, minting an open edition NFT would require obtaining a link to the minting portal or platform. Creators usually share links to their NFT minting portal on social platforms.

Click on the link and follow the steps required for each platform to mint the NFT to your wallet. Note that you will not be able to mint the NFT once the minting period elapses. 

Be careful of scams. Before clicking any links, ensure that the source is checked and scrutinized for any possible tweaks (e.g. domain extensions or visually similar characters) and only click links once their authenticity is confirmed. 

Final Thoughts

The regular art collector looks out for two major attributes before purchasing an artwork; the rarity and the uniqueness of the art. This is the same for NFT art collectors. Impressive art is a good attraction, but rarity is a very important feature of NFT art, as seen in the success of limited edition NFTs.

Open edition NFTs sacrifice some of the benefits of a regulated supply for inclusion and an extended reach. While they enjoy being held by a large community of NFT collectors, the absence of a rigid regulation at the time they were being minted may affect the value if there are no additional measures put in place. The original creators could still reap handsome rewards if the demand is high enough, but resale value is in question.

However, it is important to understand that both approaches to NFT distribution are meant to serve different situations or goals. Open edition NFTs are focused on exposure as they are meant to be obtained by as many people as possible during the minting event while limited edition NFT projects channel their efforts to selling out the created assets and building value for the holders.

That being said, always perform due research before minting or buying any NFT, and also note that this content is only for educational purposes, and no part was meant to be financial advice.