DeGods, a well-known NFT project in Solana, has changed to a 0% royalty scheme and will no longer get royalties from the sales of its NFTs.
While DeGods still think that royalties were an “incredible use case” for NFTs and that it would help artists who sought ways to enforce them, this was the best course of action for the company right now.
The firm revealed on Twitter that DeGods derivative collections t00bs and y00ts will also change to a 0% royalty model.
The NFT royalties issue is still being discussed in the digital art community. One of the main advantages NFTs offer over tangible art, according to some proponents, is that creators can continue profiting after the initial sale.
This is especially true for smaller collections. Others claim that paying royalties contradicts the concept of actual ownership and that holders shouldn’t be required to make further payments.
Previously, DeGods founder Frank has referred to royalties as the ideal alignment of incentives between founders and holders “right now”, and said not to get upset when “mints become more expensive and more projects rug” to those circumventing royalties.
The group also considered taking away some of the utility from NFTs that were not bought and sold on authorized marketplaces.
Frank cites data demonstrating the increased popularity of 0% royalty marketplaces as a primary reason why the company is now changing its approach.
“No good solutions are really out there for enforcing royalties and 0% markets are literally growing like weeds in terms of how many there are, pure user growth and volume growth filtered for wash trading. When you look at the data, it’s just kind of hard to believe in my mind that most of these [other] marketplaces will not go to 0% royalties,” he said in a Twitter Space.
While companies such as OpenSea and Magic Eden have consistently supported royalties, new markets and competitors have adopted a more accommodating approach. Recently developed websites including SudoSwapAMM and YAWWW enable consumers to buy royalty-free NFTs.