Over 99% Of Solana NFTs Use Metaplex
NFT creators on Solana will soon be able to enforce royalty payments on secondary sales of their work, a big win for artists who have decried the rise of marketplaces that have made such payments optional.
Metaplex Foundation, a key player in Solana’s NFT ecosystem, will release an upgrade to its Metaplex protocol on Feb. 6 that will enable royalty enforcement.
“We’re excited to ship this new upgrade tool for creators to help bring back royalties,” Metaplex tweeted last month.
Many artists were drawn into the NFT space due to the possibility of earning royalty payments on secondary sales. But the feature, widely believed to be mandatory, is easily circumvented. And some marketplaces have left it up to buyers to decide whether to pay creator-requested royalties in a bid to gain market share from competitors.
But pushback has been severe. Several marketplaces that initially succumbed to competitive pressure later reversed their decision under fire from angry artists.
“The optional royalties thing kind of started on Solana,” Tiffany Huang, Magic Eden’s head of marketing, told The Defiant. “We tried our best to sandbag and really stand by the creator for as long as possible.”
Magic Eden created a tool that would allow creators to blur NFTs sold on royalty-free platforms.
“Unfortunately, nobody used the tool, and so while we kept trying to innovate our way out of it, this thing just kept raging like a wildfire,” Huang said. “By the time October rolled around, we were like, ‘Man, we really have to do something because it’s actually having a really negative impact on our business.’”
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On Ethereum, each collection has its own smart contract, making it easier to build in royalty enforcement. On Solana, Metaplex’s smart contract governs the vast majority of NFTs.
“They finally figured out how to upgrade their standard, which we’re super grateful and happy about,” Huang said. “Because like 99% of all NFTs were using that standard, if that standard didn’t change, then we could not enforce [royalties].”
99% of Solana NFTs
Metaplex launched in 2021. According to a September 2022 whitepaper, it accounted for more than 99% of all the NFTs minted on Solana.
According to Samsung Next, an investor, Metaplex “allows for the creation and minting of NFTs using a standardized format across wallets and applications.”
When royalty-free marketplaces began to gain market share on Solana, Metaplex said it was against the practice.
“Platforms that bypass creator royalties are extractive and out of touch with what makes the web3 community special,” it wrote in a blog post last year. “Bypassing royalties damages an important revenue stream to an already struggling creator community in a depressed market.”
But its technology didn’t require that royalties be paid.
“This was a bet on community norms and values, which have held up the system, until now,” it wrote.
With an upgrade due to be executed on Feb. 6, Metaplex will allow NFT creators to protect royalties and ban marketplaces that don’t enforce them.
“Wallets, protocols and marketplaces have agreed to complete work by Feb 6th, which is when Metaplex will allow collections to upgrade,” the company tweeted this week.
Creators will be able to upgrade their collections via a community vote or opt for a unilateral upgrade with a 14-day notice period.
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- Source: https://thedefiant.io/metaplex-upgrade-solana-nft-royalties/