Yuga Labs owns Bored Ape Yacht Club, CryptoPunks, Meebits, and other NFT series. Illustration by Alex Castro / The Verge
NFT Royalties are a recurring long-term revenue stream for creators.
In 2022 alone, Opensea paid out over $1bn in royalties to creators - it drove NFT adoption.
Over the past 12 months there has been a shift in how NFT marketplaces handle royalties (timeline below). Royalties became optional, which has inspired a number of projects to make royalties immutable and enforceable in the long-term.
Timeline:
- August 26th, 2022: X2Y2 announces royalties will be optional
- October 19th, 2022: Blur.io NFT Marketplace launched
- February 15th, 2023: Blur announced creator choices between Blur and OpenSea
- Option 1 - New creator collections that don't block Blur allowed Blur to enforce minimum 0.5% royalties (the seller can opt-in to higher royalties as well)
- Option 2 - Creator collections block Blur allowed creators to enforce royalties on OpenSea and Blur enforced solely the minimum 0.5% royalties
- Option 3 - Creator collections block OpenSea allowed Blur enforced full royalties on their collections
- Option 4 - Existing creator collections that don’t block either OpenSea and Blur allow OpenSea to automatically set royalties to optional when they detect trading on Blur
- February 17th, 2023: OpenSea announced changes to royalty policies
- 0% Marketplace fee for a limited time
- Creator royalty earnings (0.5% min) for all collections without on-chain enforcement (old & new)
- Marketplaces with the same policies will not be blocked by the operator filter
- August 17th, 2023: OpenSea announced more changes to royalty policies that use the OpenSea Operator Filter
- Existing collections (on EVM) will have creator royalties enforced through February 29, 2024
- Existing collections on all non-Ethereum blockchains will have creator fees enforced on OpenSea through February 29, 2024
- New collections after August 31 will have creator fees set to optional
The next stage for NFT royalties
The race to an immutable and enforceable royalty solution is well and truly underway.
Magic Eden and Yuga Labs recently announced a contractually obligated royalty enforcing marketplace by year-end.
OpenSea have also been teasing that a "new foundation" is coming.
There are multiple next generation solutions being developed across the industry:
- Introducing new protocols on top of ERC-721 (e.g. ERC-721C powered by LimitBreak)
- Migrating to blockchains that have built for royalty enforcement (e.g. MIP-1 on Solana, Hedera)
They will all be explored at the NFT.NYC 2024 Royalties Track.
Featured Speakers - Royalties Track
William Entriken
Proprietor - Wm Entriken Design
Author of the ERC-721
David Iseminger
CEO - Upheaval Corp
Francesca Witzburg
CEO - ESCA Legal
Gabriel Leydon
CEO - Limit Break
NFT Royalties Track Speakers:
- Alex Loveyko
- Andres Burecovics
- Brandon Tatum
- Francesca Witzburg
- Anthony Georgiades
- Benjamin Coste
- David Iseminger
- Didi Rufus
- Michael Bacina
- William Entriken
- Gabriel Leydon
Want to Participate in NFT.NYC 2024?
- Register at NFT.NYC/Register
- Learn about Sponsorship Opportunities at NFT.NYC/Sponsor
- Show your Art in the Community Artist Showcase: NFT.NYC/Art
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