OpenSea Sunsets On-chain Royalty Enforcement Tool

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  • Popular NFT marketplace OpenSea has announced plans to shut down its on-chain royalty enforcement tool Operator Filter
  • The decision will see the platform shift from compulsory to optional royalties
  • OpenSea said the move was because the feature didn’t receive desirable uptake among creators

Popular NFT marketplace OpenSea is changing how it enforces NFT creator royalties by shutting down its on-chain royalties enforcement tool known as Operator Filter, nine months after launching the tool due to pressure from the NFT community. OpenSea said that the feature didn’t gain traction among creators, necessitating it to ditch compulsory royalties for optional creator kickbacks. The move comes a few months after Blur told users to block OpenSea for full royalties.

NFT Community Didn’t Embrace It

According to the marketplace, Operator Filter will be switched off on August 31 giving way for optional royalties for new collections. However, OpenSea will enhance other features such as “increasing the visibility of creator fees” for both buyers and sellers.

<blockquote class=”twitter-tweet”><p lang=”en” dir=”ltr”>Starting Aug 31, we’ll:<br>- Sunset the OpenSea Operator Filter<br>- Move to optional creator fees on all secondary sales for new collections<br>- Improve visibility of creator fee settings and listings on buyer &amp; seller side<br><br>More below:</p>&mdash; OpenSea (@opensea) <a href=””>August 17, 2023</a></blockquote> <script async src=”” charset=”utf-8″></script>

OpenSea CEO Devin Finzer noted that the tool failed to receive considerable adoption from the NFT community, adding that some artists saw the tool as a barrier to listing their creations in many marketplaces. 

Finzer also noted that some NFT exchanges such as Blur have found a way to circumvent the tool by employing the Seaport Protocol.

According to OpenSea, those collections currently using Operator Filter will continue being supported until late February next year. However, Finzer revealed that the marketplace isn’t doing away with royalties but only changing how it enforces them.

Finzer also disclosed that the exchange is now concentrating on exploring new use cases such as physical and virtual redeemables. 

It Prevents Hype Trading

The decision has split the web3 community with some noting that it prevents hype trading while others think that OpenSea is bowing to pressure from other marketplaces that don’t enforce royalties.

The royalties debate had attracted leading NFT creators like Yuga Labs who suggested that only smart contract-based NFT transfers should be required to pay creator fees.

With OpenSea sunsetting compulsory creator fees, it’s to be seen whether other marketplaces like X2Y2 will follow in the footsteps.