The non-fungible token (NFT) space may have been spared the brunt of the catastrophic fall of FTX, but the battle for market share continues. Amid the chaos, Magic Eden – the most popular marketplace for Solana NFTs – announced the launch of a new tool that will enforce royalties on all new collections that sign up.
Built on top of Solana’s SPL managed token standard, the open source tool is called “Open Creator Protocol (OCP)” and will help creators protect royalties. Additional features, such as dynamic royalties and customizable token transfer, will also be enabled.
Create royalties in Magic Eden
According to the official press release, creators adopting the OCP will be able to ban marketplaces that have not imposed royalties on their collections. The tool will affect creators who launch new collections starting December 2nd. Royalties will remain optional on Magic Eden’s marketplace for new collections that do not use OCP.
Jack Lu, CEO and co-founder of Magic Eden, emphasized the growing expectation for solutions to NFT royalties.
“We have been in active conversations with several ecosystem partners to identify solutions for creators in a timely manner. Our intention with the Open Creator Protocol is to immediately support royalties for creators launching new collections, while we continue to coordinate with ecosystem partners for more solutions.”
Magic Eden honored royalties from the creator until mid-October this year. However, it faced stiff competition from rival NFT marketplaces on Solana, which began rejecting royalties or making the system optional for traders.
Magic Eden then switched to an optional royalty model in what was considered a major blow to royalty supporters in the network. The move will essentially allow buyers or sellers of NFTs to choose what percentage of the sale to return to the original artist.
Following the decision, the marketplace assured that it still supported royalties for creators and would explore ways to make royalties enforceable.
Creator royalties allow creators on a marketplace to earn money from secondary sales. But if the markets themselves don’t collect, creators don’t get paid.
NFT giant OpenSea also faced a similar dilemma with declining market share and revealed it was considering making them optional for traders. However, after backlash from the creator, the marketplace reversed its decision and so that it will continue to enforce royalty fees for creators going forward.
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