Magic Eden is shifting its attention back to Solana after losing its marketplace dominance to a new competitor, Tensor. Launched in 2022, Tensor calls itself a pro-NFT trading marketplace for Solana and raised $3 million in seed funding in March.
Tensor took Magic Eden’s Solana NFT majority market share by trading volume for a few days last week. This happened after the April launch of the Solana profile picture (PFP) collection Mad Lads, which gave the Solana NFT market a much-needed boost after DeGods migrated to Ethereum and Polygon.
Magic Eden has finally lost volume market share to Tensor.The bigger they are, the harder they fall.Finally, somebody’s given ME some competition(and maybe an incentive to do better!) pic.twitter.com/QTl9lsS6Gm
— salty (rochan.eth) (@0xSxlty) April 27, 2023
Employing a similar strategy to Blur, the Ethereum marketplace, and OpenSea competitor, Tensor offers rewards for trading on its marketplace, which attracted NFT collectors to the platform over Magic Eden. In March, Tensor launched its Season 1 airdrop that allowed Solana NFT collectors to claim free rewards that correspond to their trading activity on the network.
To incentivize trading of the Mad Lads collection, both Tensor and Magic Eden have implemented reward programs. Tensor will be using 100% of the fees collected on Mad Lads to purchase NFTs from the collection and distribute them as rewards to traders on their platform for the first three months following the collection’s launch. On the other hand, Magic Eden waived trading fees for Mad Lads NFTs during the first 72 hours after minting and subsequently distributed over 5,000 SOL worth of Mad Lads trading fees back to their users.
According to The Block Research, Tensor has a total trading volume of $2 billion to date. Tensor’s entrance to the Solana NFT market has undoubtedly caught Magic Eden’s attention as the latter seeks to maintain its dominance in the Solana NFT market after expanding multi-chain in recent months. Amidst the Mad Lads frenzy, Magic Eden even posted controversial tweets targeting Tensor before deleting them.
In two pictures…First, Tensor surpasses Magic Eden for the first time in single-day trading volume.About 24 hours later, two controversial tweets came from the Magic Eden twitter account. Those were deleted after. pic.twitter.com/LwwkxrlO2b
— cryptoanedrico.btc (@cryptoanedrico) April 28, 2023
Speaking to The Block, Tiffany Huang, head of marketing and content at Magic Eden, said that the market needs a deep, renewed focus on Solana and that the company considers Solana its home.
As per the Dune Analytics data, Magic Eden remains the leading Solana marketplace, with Tensor following closely behind. Specifically, Magic Eden holds a 65.5% market share, while Tensor has a 34.5% share.
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