NFT in focus

The meltdown in the cryptocurrency sector and other crypto assets is taking unexpected victims, in this case: artists. Four of the giant NFT platforms made a related announcement to end royalty payments to creators of do dedo art for sale on the sites.

After NFT sales increased in 2021, the artistic environment was prepared for a revolution in terms of how to display and market its products thanks to a small innovation: royalties from secondary sales.

The purpose behind it was simple, to keep the NFT code, that is, of do dedo art, a tool that allowed the sale of a work and the artist would earn a percentage of the value.

However, due to the crisis in the NFT market, in which sales fell by almost 99% in the last 15 months, four different platforms for buying and selling this type of art will not continue to pay these royalties, according to the report by Axios . A practice that essentially affects those who push to bring the definition of blockchain out of bounds enthusiasts.

Magic Eden and LooksRare, in pessoal, have changed their policy to optional royalty models, freeing buyers to choose whether or not to pay creators the usual 3% to 10% off retail prices for NFTs. The reason is clear: merchants are looking for higher profit margins on NFT sales, so platforms are looking to keep a high number of possible traders on their sites.

NFT in focus

NFT

It is noted that on the operational side, royalties could never be guaranteed on the blockchain, because there is no way to adhere to rules for cryptographic token transfers. Instead, the documentation of each NFT only requires payment, an option that platforms accept in market conditions with more benefits.

Beeple, as artist Mike Windkelmann is known, stated “there is no way to force royalties technologically”. He became famous after selling an NFT for US$ 69.3 million (R$ 367 million), in March 2021 at Christie’s auction environment.

It is evident that criticism from individuals connected to this NFT market environment quickly emerged, with blacklists being created and some even trying to shame platforms that avoid paying royalties, even opting for the threat of mass divestment.

To date, market leading Ethereum MarkersPlace and OpenSea continue to maintain their royalty favoring policies. MarkersPlace chief executive Craig Palmer said in a public statement that the “optional approach” does not fit his “vision for the space”.

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