NFT Royalties
Percentage of every NFT resale automatically going to original creator.
NFT royalties are automatic transfer of a portion of revenue from every secondary NFT resale back to the original creator — built into the smart contract.
How they work:
•Creator sets royalty % at creation (e.g. 10%)
•At every resale, 10% automatically goes to creator
•Smart contract executes distribution without intermediaries
Royalty controversy:
•Marketplace wars 2022–2023: Blur introduced optional royalty payment
•Creators protested, Blur counter-program for creators
•OpenSea responded by removing mandatory royalties
•Many creators lost revenue
On-chain vs off-chain royalties:
•On-chain (EIP-2981) — built into token standard
•Off-chain — marketplace enforces, not guaranteed
•Solana NFT royalties: similar debate
Practice:
•Buy NFTs with on-chain royalties if you support creator economy
•Royalty revenue can be millions for top NFT collections
•BAYC creators earned ~$100M+ from royalties