OpenSea reconsiders its strategy on royalties for NFT creators

OpenSea announced that it has revisited its strategy regarding NFT creator royalties and launched version 2 of the tool. Not only that, the marketplace has extended the deadline to 2 January, the date by which creators and companies using it, must be able to apply to the updated royalties tool. 

OpenSea announces changes on royalties for NFT creators

In a roundup of tweets, the popular NFT marketplace, OpenSea, announced that it has modified its tool on NFT creator royalties.

2/ The revolutionary potential of creator fees has been under attack for months. Marketplaces that do not respect creator fees have been rapidly growing in prominence, and creators, in turn, have seen their effective creator fees severely diminished.

— OpenSea (@opensea) December 8, 2022

Among the first changes, OpenSea revealed that the former Operator Filter Registry tool dedicated to NFT creator royalties will be overseen by CORI – Creator Ownership Research Institute. 

This is a new group of companies, including OpenSea, Nifty Gateway, Zora, Manifold, SuperRare and Foundation, which will use a multi-signature wallet – the kind that requires more than a single actor to sign a transaction – to make changes to the registry. 

Not only that, following with tweets, OpenSea also specified that it will intend to involve the community in CORI, implementing decentralized governance. 

OpenSea and the evolving NFT creator fee standard

The main goal of the marketplace is to incentivize the industry to return to universal compliance with creator fees so that on-chain enforcement tools can become an option for some, but not a requirement for all. 

Of course, OpenSea itself realized that after the first Operator Filter was launched last 8 November, not all other companies used by NFT creators were able to keep up. 

And indeed, OpenSea cites the case of Manifold, which has garnered complaints from creators because precisely the company itself has failed to adapt to the new royalty policy. 

For this very reason, the new creator fee standard will begin to be a reality for all those who introduce it, starting 2 January 2023, in all EVM chains.

How the on-chain royalty tool works

OpenSea wants to make a return to royalties for NFT creators, after the marketplace welcomed other marketplaces that instead made them optional, impoverishing Non-Fungible Token creators by 20%. 

And indeed, wanting to support such creators (and attract new ones), OpenSea launched in early November its new on-chain tool dedicated to royalties for creators in its first version.

It is a simple code snippet that creators can add to future NFT contracts, as well as to existing updatable contracts. 

In this way, while the NFT creator will decide whether or not to apply the Operator Filter, OpenSea will apply creator fees for new collections that use the on-chain tool, while it won’t do it for those without it.

At the same time, NFTs that include the code snippet, i.e., apply the creator’s fee, will not be able to be sold by marketplaces listed at zero royalty or optional royalty.