Key Insights:
- OpenSea launches its On chain tool for NFT royalties enforcement
- The enforcement tool is a simple snippet code
- It will be available for new collections (excluding existing NFTs) and can alter new smart contracts.
OpenSea — the largest NFT marketplace —launches its on-chain tool to enforce NFT royalties. This NFT marketplace has about 66% of the market share in NFT space
Therefore, there are expectations that it should be the leading voice on the issue of royalties and enforcement. While several other marketplaces (with smaller market sizes) have launched their loyalty program— OpenSea has decided to launch its On-chain tool for NFT royalties.
OpenSea’s On-chain Tool For NFT Royalties
OpenSea, an NFT marketplace, launches its on-chain tool to help creators enforce royalties. OpenSea CEO Devin Finzer said the newly launched on-chain enforcement tool is a “simple code snippet.”
The tool will enable creators to enforce royalties on new and future NFT collections. It will affect and enforce the changes on new and future NFT collection smart contracts. Finzer adds that the code will restrict NFT sales to only marketplaces that enforce creator fees.
Furthermore, the CEO said OpenSea would enforce the royalties on new collections. However, they can’t enforce the code if a new collection does not opt into the royalty program. OpenSea tweeted that the tool will put more power in the creator’s hands to control their business model.
Finzer went further in a Twitter space to shed more light on the newly launched royalty enforcement tool. He said we are “not requiring folks to use our specific solution.” Creators can use whatever solution they want and implement it in any way.”
Finzer said the launch became necessary because the fee declined in marketplaces where the royalties were optional. He said, “we’ve watched the voluntary creator fee payment rate dwindle to less than 20%.”
Additionally, Finzer said creators willingly refuse to pay the royalties or creator fees elsewhere. The new tool will therefore allow creators to deliver “on-chain enforcement” of their royalties.
You would recall that ahead of OpenSea, some of the NFT marketplaces have rolled out their royalty enforcement tools. For instance, X2Y2 launched its royalty model in August, while Magic Eden launched its own in October.
The royalty model is optional in Magic Eden, a Solana-based NFT marketplace. Buyers can set the amount they want to contribute as royalty to an NFT project.
The newly launched royalty enforcement model by OpenSea seeks to allow creators to have more proceeds from their sale of NFTs. Similarly, the NFT marketplaces will have a good share of the proceeds.
OpenSea says that every NFT creator that wants to earn creator fees has to enforce the code on-chain.
