The Threat Posed by Bots
In the digital landscape, bots refer to automated programs designed to perform specific tasks at high speeds. In the context of NFTs, these bots can rapidly mint (create) or purchase multiple NFTs during a drop, thereby hoarding these digital assets for personal gain. This is an issue because it hinders the fair distribution of NFTs and hampers community development around a particular project.
Bots can outperform human collectors by a vast margin due to their ability to conduct consecutive transactions instantly. As such, they can effectively monopolize the availability of a new NFT, leaving actual human collectors empty-handed.
Bots present varying degrees of threat depending on the blockchain used. For instance, Solana, with its low transaction fees (gas prices) and high transaction speed, is especially vulnerable. This is because the lower the gas price and the faster the transaction speed, the more beneficial it is for a bot to execute many transactions rapidly.
The Power of Allowlists
To counteract the bot issue, NFT creators can use a mechanism known as an allowlist. Allowlists are akin to guest lists at a private event; only those on the list can participate.
An allowlist in the context of NFT minting is a list of trusted wallet addresses permitted to participate in the minting process. When a transaction is initiated, the smart contract will verify whether the buyer's wallet address is on the allowlist. If it's not, the transaction will be rejected. This effectively bars bots and other malicious actors from participating, as the wallet addresses they use won't be on the allowlist.
Allowlists can also be used to reward loyal followers or active community members by granting them exclusive access to certain project features or benefits.
Creating an Allowlist with NFT-Inator
NFT-Inator is a platform that allows NFT creators to deploy smart contracts with an integrated allowlist feature. The process is user-friendly, involving just a few clicks and the input of trusted wallet addresses. Notably, you can modify the allowlist even after deploying the smart contract, providing ongoing control and adaptability.
Moreover, NFT-Inator platform offers a contract dashboard where various settings and features can be managed. It's also flexible in accommodating creators at different stages of their project, whether they are yet to generate a collection or already have artwork ready for minting.
Create a project and an allowlist here
Allowlists, Early Minting, and Gas Fees
An additional and often overlooked benefit of allowlists is their impact on early minting opportunities and gas fees.
Early Minting Opportunities:
In a high-demand NFT drop, the race to mint or purchase the NFTs as quickly as possible can be intense. Those who are lucky enough to mint early usually stand a chance to reap the most benefits, especially if the value of the NFT appreciates over time. An allowlist ensures that the loyal and early members of your community get the priority they deserve. They won't be left out in the cold due to the automated speed of bots, and the exclusive window of opportunity provided to them further fosters community loyalty and enthusiasm.
Reduced Gas Fees:
Gas fees are the costs required to perform a transaction or execute a contract on the Ethereum blockchain (and others like it). When network congestion is high during a popular NFT drop, gas prices can skyrocket as users compete to have their transactions processed quickly.
Using an allowlist helps manage the congestion by giving approved addresses an exclusive window to mint the NFTs. This reduces the number of transactions competing for immediate processing, effectively lowering gas prices during the allowlist window.
It also reduces the risk of wasted gas fees. Without an allowlist, users could pay high gas fees for transactions that ultimately fail because a bot beat them to the punch. But with an allowlist, users have a much better chance of successful transactions, meaning their gas fees won't go to waste.
The Importance of Allowlists
To sum up, allowlists are a vital tool in the Web3 creator's arsenal. They offer a practical solution to the bot issue, ensuring a fairer and more balanced distribution of newly minted NFTs. As an NFT creator, having a strategy in place to deter bots from scooping up your digital assets is crucial. Implementing an allowlist not only fortifies your launch against bot manipulation but also rewards your loyal community members, enhancing their experience and encouraging ongoing engagement with your project.