The leading NFT marketplace plant a flag for creator royalties, but only after receiving criticism for considering differently.
OpenSea, the largest NFT marketplace in terms of trading volume, declared today that it will continue to enforce creator royalties on NFTs, despite substantial community backlash.
“We will continue to enforce creator fees on all existing collections,” the firm wrote in a tweet thread. “We’re awed by the passion we’ve seen from creators and collectors alike this week. We were looking for your feedback, and we heard it, loud and clear.”
OpenSea said on Saturday that it was rethinking its policy on requiring creator royalty fees on NFTs. This came after a number of competing marketplaces either rejected such fees or gave traders the option to pay them or not. The NFT artist or creator decides on the royalty fee, which is usually between 5% and 10% of the secondary sale price.
UPDATE: We will continue to enforce creator fees on all existing collections.
— OpenSea (@opensea) November 9, 2022
OpenSea gave itself a deadline of December 8 to get feedback from the community and think about possible next steps, which it said could include making creator fees optional for traders, only enforcing them on certain types of NFT collections, or putting in place new ways to enforce them.
Many big creators, like Yuga Labs, who made Bored Ape Yacht Club, didn’t like the idea that the biggest NFT platform on the market might stop collecting royalties. They spoke out against OpenSea and started organizing among themselves.
The Hundreds, a well-known streetwear brand, stepped up its response on Tuesday by saying it was canceling an OpenSea NFT drop this week. “May it be a reminder to them, to you, and the world that the artists are always in control,” the firm’s founders wrote.
OpenSea got the message “loud and clear” from the community, as its tweet says. The $13.3 billion Web3 startup said it was “seeking guidance from our community,” but it also pointed to data showing that the share of creator royalty fees on the market as a whole has been falling in recent weeks as marketplaces that don’t pay royalties have been growing in popularity.
“Unless something changes soon, this space is trending toward significantly fewer fees paid to creators,” OpenSea wrote. “No policy that we implement will reverse this trend if this behavior continues.”
OpenSea told creators to make it easier for traders to pay royalties by giving them more reasons to do so and directing them to marketplaces that do pay royalties. It also pointed to the need for more ways to enforce methods.
On Saturday, OpenSea announced a way to make sure that new NFT projects pay their royalties. The system is based on a blacklist that prevents listed marketplaces from taking care of these transactions. The method goes after marketplaces that don’t fully enforce royalty fees, which are some of OpenSea’s biggest competitors. Some people have called this move anti-competitive.
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