By Alicia Maher
The world’s largest NFT marketplace, OpenSea, seems to have made a firm decision over NFT royalties. The topic has created a lot of debates on how creators can get their actual royalties.
OpenSea Takes the Lead
According to CoinGecko’s report, OpenSea controls 66% of the total NFT market. Surprisingly, OpenSea maintained relative silence in the debate. Other marketplaces, on the other hand, have been developing their strategies around royalties.
OpenSea CEO, Devin Finzer, shared some insight via a blog post on the 6th of November. He said they have studied platforms where fee payment was optional. They also observed as a result that creator fees on those platforms dropped steadily to under 20%.
Whereas, in other marketplaces, the creator fees were just not paid. Finzer then announced that OpenSea has developed a new feature. He said it lets creators carry out enforcement on paying their royalties.
Finzer said the feature is just a little code switch-up that allows creators to make sure royalties are paid. This will involve all new NFT collections and those to be created in the future. There is also a means for them to upgrade their smart contract.
Furthermore, the code is going to limit NFT sales only to platforms that enforce royalty payments. Finzer said it is obvious that a lot of creators seek ways to make sure fees are paid on-chain. And OpeSea fundamentally believes that the choice should be made by those creators.
Options for Exiting Collections
No marketplaces should decide whether or not creators get their royalties, or how. Finzer also said OpenSea will implement royalty for new collections that choose to opt in.
He clarified things in a follow-up Twitter Space after the announcement. Finzer said OpenSea does not mandate creators to use its solution specifically. They can use any solution they wish to use in any way.
The features will not be out for existing NFTs yet because of implementation problems. The likely way enforcement of creator fees for existing collection is a community drastic measure. It would involve moving the collection to another smart contract, according to Finzer.
The best opinion from OpenSea is for existing NFT creators to try out new ways of monetization. Finzer said they should find means of incentivizing people to pay the creator fees. They should also make sure that their future collections enforce on-chain creator fees.
The options around this, for Finzer, include enforcing off-chain payment for certain collection subsets. They can also permit optional fees and collaborate on other on-chain options.