Race to the Bottom as NFT Marketplaces Refuse to Pay Artist Royalties
Royalties are a big draw for artists, who value the ability of most non-fungible tokens to allow the creator to add a royalty collection feature on each resale at the time it is minted. So, each time an NFT is sold, a percentage of the price — generally 5% to 10% — is sent to the person who made it.
On Oct. 27, LooksRare, the second-largest NFT marketplace on the Ethereum blockchain according to DappRadar, announced that it would no longer collect and distribute artist royalties. Instead, it’s turning a quarter of the 2% protocol fee it collects on transactions, so the creators will get a 0.5% cut of sales. Which is better than nothing but a small fraction of the royalty fee that artists generally choose to levy.
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