OpenSea to Stop Enforcing Creator Royalties on Secondary Sales
OpenSea, once the leading NFT marketplace, has announced plans to make creator royalties optional for secondary NFT trades, a move that has sparked reactions from the NFT community.
OpenSea's Shift on Creator Royalties
In a recent development, OpenSea, a prominent NFT marketplace, declared that it would cease enforcing creator royalty fees on secondary sales of NFTs. Starting from August 31, artists listing new projects on the platform won't be able to mandate buyers to pay a creator fee, which usually ranges between 2.5% to 10% for secondary NFT sales. Instead, artists can only suggest their preferred creator fee, which buyers can opt to pay as a form of gratuity.
Existing collections on non-Ethereum blockchains and those using OpenSea’s Operator Filter will still be able to ensure creator fees until February 29, 2024. After this date, NFT creator fees will become entirely optional across the platform. OpenSea's co-founder and CEO, Devin Finzer, emphasized that creator fees aren't disappearing but the unilateral enforcement of them is.
The NFT Marketplace Landscape
The decision by OpenSea is seen as a response to the evolving dynamics of the NFT industry. Newer NFT marketplaces have emerged, offering reduced or no creator royalties, thereby attracting significant trading volumes. One such platform, Blur, adopted a free-market approach and soon surpassed OpenSea in trading volume.
This shift prompted OpenSea to reconsider its royalty fee protections to stay competitive. The removal of enforced creator fees by OpenSea is indicative of the platform's ongoing efforts to maintain its user base amidst rising competition.
Reactions from the NFT Community
OpenSea's announcement has elicited varied reactions from the NFT community. While some NFT marketplaces that still enforce creator royalties criticized the decision, notable NFT artists and project creators expressed their disapproval on social media platforms.
John Crain, SuperRare's co-founder and CEO, commented that royalties on secondary sales are crucial to the NFT art revolution and are fundamental to artist sovereignty.
