New research report today from Mike NovogratzGalaxy Digital found it Ethereum Royalties were paid to NFT creators totaling $1.8 billion from secondary sales in markets such as OpenSea.
In the ReportGalaxy Digital researchers Sal Qadir and Gabe Parker also found it NFT Creator equity rates on OpenSea – the highest overall market by volume – have doubled over the past year on average, jumping from 3% sales discounts to 6%.
The researchers also discovered a concentration of royalties among just 10 entities, data that suggests the NFT economy may be more centralized than some might think.
The top ten received nearly half a billion dollars in royalties, equal to 27% of all Ethereum NFT earnings. According to the report, which is based on data from Flipside encryptionCombined, 482 NFT combinations received 80% of all market returns.
NFTsA unique blockchain icons which denotes ownership – usually first”Quietor sold on a third-party website developed by the creators of the NFT, or via a custom launch pad available from certain markets. After the mint, NFTs can be resold through marketplaces such as open seaand Magic Eden and LooksRare and others.
While new NFT markets still appear regularly, OpenSea still makes up the lion’s share of all NFT resales, according to data From sand dune analytics and Galaxy Report, which states that OpenSea accounts for more than 80% of the total Ethereum NFT market size.
When minting NFT projects through OpenSea, creators can Choose the percentage of royalties they would like to receive secondary sales. These creators have collectively earned $76.7 million to date in revenue from these sales. Measured together, that’s enough for third on the Galaxy list.
Other notable NFT creators on the list include Chiru Labs (azuki), evidence – proof (moon birds and Proof Collective), the teams behind it sandAnd the Doodlesand VeeFriends by Gary Vaynerchuk.
quote separate data set Galaxy focus only on old brands nike As the highest return with a profit of $91.6 million. That list includes several non-Nike branded NFT offerings from RTFKT, a digital studio Nike acquired in 2021. Other brands on the list include Dolce & Gabbana, Gucciand Adidas.
grumble of kings
Historically, the proceeds have been praised as a important part From the NFT ecosystem, providing a steady stream of income to creators continue development Various plans on their project’s “roadmaps,” whether that’s creating a video game, throwing token-gated parties, or hiring more community moderators, for example.
I think what is clear to me in the NFT royalties 1. It’s a really great mechanism for creators to earn extra revenue 2. If it is not directly applied in technology, the market will move around it 3. It must be visible to users
Kader and Parker call the royalties “the core value proposition of NFTs,” but they also acknowledge that royalties are not currently enforceable on-chain without sacrificing some principles of decentralization and self-guarding — values dear to many crypto proponents.
Arguably, enforcement of on-chain proprietary rights leads to a new type of trilemma blockchain that is not very different from Ethereum co-founder Vitalik Buterin. discuss At length, the Algorand platform competition Claims to solve. Instead of on-chain execution, it has historically been up to NFT central markets to choose to charge creator-imposed royalties.
NFT royalties have become the topic of much discussion this month. Frank, creator of Solana NFT, which goes by the pseudonym, has made the decision to eliminate royalties from DeGods and y00ts profile picture NFT groups fully on October 9, describing the move as an “experiment.”
His move came after Solana markets surged by either ignoring creators’ royalties or letting traders choose whether or not to pay them. By not paying creators royalties, NFT sellers typically avoid paying a 5% to 10% reduction of the secondary sale price.
In the end, the best markets Solana Magic Eden announced last week He will follow suit and make the payment of royalties optional afterwards Losing a large market share platform competition. “We understand that this move has serious ecosystem impacts,” the market He said On Twitter, adding that she hopes to “see new standards that protect royalties.”
Some on Twitter criticized Magic Eden for her decision, calling it “too much worst decision“And the”desperate understanding for market share.” Metaplex, which created Solana’s existing NFT standard, said Thursday that it is developing a new standard that can charge royalties to the chain.
As the debate over NFT returns rages, one thing is for sure: Giving up royalties means creators will part with a large source of passive income — and potentially leave millions on the table.
Stay up to date with cryptocurrency news, and get daily updates in your inbox.