Wednesday, 22 March 2023

Crypto News

OpenSea launches new “on-chain” tool to enforce NFT royalties

OpenSea launches new "on-chain" tool to enforce NFT royalties

Nonfungible (NFT) marketplace OpenSea appears to have taken a position in the NFT royalties debate — launching a new “on-chain” tool helping creators enforce royalties. 

The NFT marketplace, which according to CoinGecko commands 66% of the market share in NFT marketplaces been relatively silent on the issue of royalties and enforcement while others in the space have been implementing their own strategies over the last few months. 

In a Nov. 6 blog post, OpenSea CEO Devin Finzer noted that in marketplaces where fees are optional, they’ve “watched the voluntary creator fee payment rate dwindle to less than 20%”, while in other marketplaces creator fees are “simply not paid at all.”

The OpenSea CEO announced the marketplace has launched a new tool that will allow creators to deliver “on-chain enforcement” of their royalties. 

Finzer described the tool as a “simple code snippet,” which allows creators to enforce royalties on new and future NFT collection smart contracts, and existing upgradeable smart contracts. The code will also restrict NFT sales to only marketplaces that enforce creator fees.

“It’s clear that many creators want the ability to enforce fees on-chain; and fundamentally, we believe that the choice should be theirs to make — it shouldn’t be a decision made for them by marketplaces,” Finzer said.

Finzer also said that OpenSea will enforce royalties for any new collections using an on-chain enforcement tool, but won’t do so for new collections that don’t opt-in. 

Finzer explained in an accompanying Twitter Spaces that OpenSea is “not requiring folks to use our specific solution,” creators can use “whatever solution you want and implement it anyway.”

“We provide a template GitHub repo that helps you use a solution that basically blocks lists marketplace that doesn’t support creator fees, you don’t have to use that solution; the requirement is that if you want creator fees, you have to enforce them on chain.”

The tool also won’t be rolled out for existing NFT collections for the moment due to implementation challenges. 

“To the best of our knowledge, the only way to achieve on-chain creator fee enforcement for…

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