- OpenSea has announced an on-chain tool for ‘optional creator royalties’.
- The NFT marketplace will commence testing the tool from November 8.
- The marketplace will not enforce royalties on new collections without the on-chain tool.
The NFT marketplace OpenSea has weighed in on the NFT royalties debate, unveiling a new “on-chain” tool to assist creators in enforcing royalties. OpenSea recently announced that they will develop a business model to enforce NFT royalties where creators can monetize their work.
The NFT marketplace, which commands 66% of the market share in NFT markets, has remained largely mute on the matter of royalties and enforcement, while others in the field have been implementing their own strategies and models in recent months.
In detail, OpenSea CEO Devin Finzer stated in a blog post published on November 6, in markets where payments are optional, they’ve “seen the voluntary creator fee payment percentage dwindle to less than 20%,” while in others, creator fees are “just not paid at all.”
Finzer announced the creation of a new tool that would allow NFT creators to provide “on-chain enforcement” of their royalties.
The solution, according to Finzer, is a simple code snippet that allows producers to impose royalties on current and future NFT collecting smart contracts, as well as existing upgradeable smart contracts. In addition, the code will limit NFT sales to just markets that charge creator fees.
Moreover, the CEO added that many artists desire the option to impose fees on-chain and fundamentally, the choice should be theirs to make, and not by the marketplace. He also stated that OpenSea will use an on-chain enforcement mechanism to enforce royalties for new collections, but will not do so for new collections that do not opt-in.
Concurrently, OpenSea will only enforce creator fees for new collections that employ an on-chain enforcement mechanism and collaborate with communities on solutions for existing collections. They pledge not to make any adjustments to existing collections until at least December 8, 2022.
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