Yuga Labs, the brains behind top NFT collections like BAYC, MAYC, CryptoPunks, and others, has shown its support for royalty fees. The team noted in an X announcement that it would withdraw its affiliated NFT collections from marketplaces not enforcing the royalty model. The move marks a watershed moment for NFT creators affected by a drawback among NFT marketplaces from royalty enforcement.
NFT royalties are fees paid to creators after every secondary sale of the NFT. The fee, often pegged at a certain percentage, is determined by the amount the digital artwork sells for. Discussions involving creators’ royalties have been controversial over the past few years. Popular NFT marketplaces adopted varying stances on the matter, ranging between compulsory, optional, and zero royalties enforcement. LooksRare, for example, implemented a zero royalty policy since November 2022.
Yuga Labs’ latest move is accompanied by the “much anticipated” launch of an Ethereum-based NFT marketplace in collaboration with Magic Eden. Recall that in November 2023, the duo platforms declared plans to roll out an NFT marketplace compatible with digital collectibles on the Ethereum network while upholding creators’ royalties. The BAYC creator described the new royalty-focused platform as “the first major marketplace to partner with creators.”
Yuga Labs adds in its announcement:
“In sync with the marketplace launch, [starting February 27th] we will be sunsetting our support for marketplaces who don’t support royalties for ALL creators. This means that our collections with a royalty filter will only be traded on marketplaces that respect creator royalties for any and all creators at the protocol level.”
Among the NFT collections affected by the announcement are Otherside’s Koda, Loot, Catalyst, 10KTF’s Gucci Grail, Combat Crates, HV-MTL, Sewer Passes, and more.
With Yuga Labs’ latest shift towards fostering a creator-focused community within the Ethereum ecosystem, the firm paves the way for platforms upholding the zero royalty policy to rethink their choices. Time will tell if more NFT platforms will take a similar path.
