- Leading NFT marketplace OpenSea has introduced a tool to enforce on-chain royalties for new NFTs
- OpenSea believes NFT creators should decide how to implement royalties and not marketplaces
- Existing collections will have to wait until next month to know how OpenSea intends to handle creator fees
Leading NFT marketplace OpenSea has launched an Ethereum-based on-chain royalties enforcement tool, breaking its silence on the NFT creator fees topic that has been a contentious issue on many marketplaces. According to OpenSea, NFT artists should have the final say on how to collect fees on secondary sales instead of delegating that power to marketplaces. OpenSea had remained silent on the issue even as its rival Magic Eden turned to optional royalties.
3/ To that end today we’re launching a tool for on-chain enforcement of creator fees for *new collections* Starting 12pm ET on Tuesday Nov 8 OpenSea will enforce creator fees only for new collections that use an on-chain enforcement tool such as this one. https://t.co/i0PMdt5HiV
— OpenSea (@opensea) November 6, 2022
Block Marketplaces Ignoring Royalties
In a Twitter thread on Sunday, OpenSea disclosed that the enforcement tool is among other tools meant to empower creators to “control their business model.” The new feature will go live tomorrow, November 8, and will only be available to creators listing new artworks on the platform.
In an interesting twist, the tool also gives creators the ability to prevent their creations from being traded on marketplaces that don’t honor royalties. According to OpenSea, an NFT marketplace can be blocked if it offers NFT traders a way to “bypass creator fees when a similar transaction for the same item would require creator fee payment on OpenSea.io.”
On-Chain, Off-Chain or Optional Royalties?
Creators of existing collections will have to wait until December 8 to find out how the NFT marketplace intends to implement NFT royalties. However, it has suggested that it may take the optional royalties route, make use of an off-chain enforcement system or implement “other on-chain enforcement options.”
OpenSea currently allows creators to pocket between 5% to 10% every time their creations change hands on the secondary market. While this system isn’t 100% powered by blockchain technology it’s largely been successful. OpenSea’s decision to enforce on-chain royalties is likely to attract creators who have frowned at Magic Eden, LooksRare and X2Y2’s move to turn to optional royalties.
