The CEO of OpenSea announced the debut of a new tool in the marketplace that will enable authors to deliver “on-chain enforcement” of their royalties.
OpenSea, a nonfungible (NFT) marketplace, appears to have weighed in on the issue of NFT royalties by introducing a new “on-chain” tool to assist producers in enforcing royalties.
While other players in the field have been implementing their own techniques over the past few months, the NFT marketplace, which according to CoinGecko commands 66% of the market share in NFT markets, has remained somewhat quiet on the matter of royalties and enforcement.
OpenSea CEO Devin Finzer wrote in a blog post on November 6 that they have “seen the voluntary creator fee payment rate decrease to less than 20%” in marketplaces where payments are optional, while in other marketplaces creator fees are “just not paid at all.”
The CEO of OpenSea announced the debut of a new tool in the marketplace that will enable authors to deliver “on-chain enforcement” of their royalties.
The viability of creator fees (sometimes known as “royals”) and economic models for NFT creators have become hot topics in recent months.
The tool, which Finzer called a “simple code snippet,” enables developers to impose royalties on present and past NFT collection smart contracts as well as upgradeable smart contracts that have already been created. Additionally, the code will limit the sale of NFT to only those marketplaces that impose creator fees.
“It’s clear that many creators want the ability to enforce fees on-chain; and fundamentally, we believe that the choice should be theirs to make — it shouldn’t be a decision made for them by marketplaces,” Finzer said.
Finzer added that OpenSea won’t enforce royalties for new collections that don’t opt-in, but it will do so for any new collections employing an on-chain enforcement mechanism.
OpenSea is “not forcing people to utilize our specific solution,” according to Finzer in an accompanying Twitter Spaces. Instead, creators are free to use “whatever solution you choose and execute it anyway,” he added.
Due to technical difficulties, the tool won’t be made available for the time being for NFT collections that already exist.
Finzer claims that possibilities including continuing to impose off-chain fees for select subsets of collections, permitting optional creator fees, and working together on further on-chain enforcement tools for creators are included in this.
Reactions from Twitter community
There has been a range of responses from the Twitter community and NFT founder. While “I don’t fundamentally agree with the removal of royalties, I do appreciate this execution” Wab.eth, creator of the Sappy Seals NFT collection and co-founder of The Pixlverse and Pixl Labs, said to their almost 60,000 followers.
Other people also had queries that they thought needed clarification. One of the Deadfellaz NFT collection‘s authors, going by the alias Betty, said to their 89,000 followers that “it feels like there is no plan and no concrete answers were given in respect to existing collections & artist’s royalties” in a post.
Although it was noted subsequently, “I look forward to reading more concrete communication from them soon in regards to proposed strategies.”
