At this time, the royalty enforcement tool only applies to new NFT collections, with a decision on existing collections to be made later.

OpenSea, a nonfungible (NFT) marketplace, appears to have weighed in on the NFT royalties debate, launching a new “on-chain” tool to assist creators in enforcing royalties.

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

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

The CEO of OpenSea announced the launch of a new tool that will allow creators to provide “on-chain enforcement” of their royalties.

https://twitter.com/opensea/status/1589058770646491136?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1589058770646491136%7Ctwgr%5E8d78d1fee7ef98ab84e6a06550ac85a6faf0a882%7Ctwcon%5Es1_c10&ref_url=https%3A%2F%2Fcointelegraph.com%2Fnews%2Fbitcoin-heads-to-us-midterms-as-research-says-dollar-closing-in-on-a-market-top

The tool, according to Finzer, is a “simple code snippet” that allows creators to enforce royalties on new and future NFT collection smart contracts, as well as existing upgradeable smart contracts. In addition, the code will limit NFT sales to only marketplaces that charge 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 — not made for them by marketplaces,” Finzer said.

Finzer also stated that OpenSea will use an on-chain enforcement tool to enforce royalties for new collections, but will not do so for new collections that do not opt-in.

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

“We provide a template GitHub repo that assists you in using a solution that basically blocks lists marketplace that does not support creator fees; you are not required to use that solution; the requirement is that if you want creator fees, you must enforce them on chain.”

Due to implementation issues, the tool will not be available for existing NFT collections for the time being.

“To the best of our knowledge, the only way to achieve on-chain creator fee enforcement for existing collections with non-upgradeable smart contracts is for their communities to take drastic measures, such as shifting the canonical collection to a new smart contract,” Finzer said.

“In our opinion, the far better option is for existing creators to investigate new forms of monetization and alternative methods of incentivizing buyers and sellers to pay creator fees, and to ensure that future collections enforce creator fees on-chain,” he added.

This could include options like continuing to enforce off-chain fees for some subsets of collections, allowing optional creator fees, and collaborating on other on-chain enforcement options for creators, according to Finzer.

The NFT creator’s and Twitter community’s reactions have been mixed. Wab.eth, co-founder of The Pixlverse and Pixl Labs and founder of the Sappy Seals NFT collection, told their nearly 60,000 followers that while “I don’t fundamentally agree with the removal of royalties, I do appreciate this execution.”

Other users had concerns that were not addressed. Betty, one of the Deadfellaz NFT collection’s creators’ pseudonym, told their 89,000 followers, “it feels like there is no plan and no clear answers were given in regards to existing collections & artist’s royalties.”

“I look forward to reading more concrete communication from them soon in regards to proposed strategies,” he later added.

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