Ripple’s Vice President of Strategy and Operations Emi Yoshikawa has stated her view on the preferred protocol for Non-fungible token (NFT) creators when it comes to royalties. OpenSea, largest NFT marketplace is facing backlash for cutting fees and creator royalties.
According to the Ripple executive, when it comes to the XRP Ledger (XRPL), automatic royalties for creators have been built-in into the on-chain design of the digital collectible feature. With this type of arrangement, the creator i not left at the mercy of the marketplace.
OpenSea Dominance Drops
This discussion ensued after top NFT marketplace OpenSea began to experience a drop in dominance in the digital collections ecosystem. The sudden drop in patronage on the multi-blockchain was tied to the recent policy of not collecting and paying royalties on NFT sales.
Per a statement by American businessman and tech entrepreneur Mark Cuban, this is a huge blunder being committed by OpenSea. Cuban says that this move is enough to cause diminished trust in the marketplace and generally hurt the broader industry.
Usually, NFT royalties are automated payments made to the creators of the digital collectible when an art piece is resold.
As Yoshikawa stated, each NFT royalties are encoded in the smart contracts of the NFT. At the completion of a secondary sale, the smart contract automatically pays the marketplace a portion of the royalty as per the creator’s request. Thereafter, the royalties are transferred to the creator.
✅ On the XRP Ledger, automatic royalties for NFTs are enforced at the chain protocol level and creators are NOT at the mercy of individual marketplaces.
With XRPL, token issuers’ rights are protected. https://t.co/h1zaHf9S2L
— Emi Yoshikawa (@emy_wng) August 18, 2023
NFT Creators Might Ditch OpenSea for XRPL
Last year, OpenSea tweeted that “It’s clear that many creators want the ability to enforce fees on-chain & we believe that choice should be theirs–not a marketplace’s–to make.So we’re building tools we hope will balance the scales by putting more power in creators’ hands to control their business model.”
However, earlier this week, OpenSea slashed the creator’s royalties, a move that was widely criticized by members of the NFT community.
On the other hand, XRPL boasts of having an unparalleled level of creator’s rights protection which promotes a more fair, decentralized, and democratic revenue-sharing model in the sector. The recent surge in NFT transactions on XRPL, per data from the XRPMarket tracker, may have likely been boosted by this edge which NFT creators on the platform believe that it has over OpenSea.
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