Magic Eden accompanies OpenSea with NFT royalty enforcement tools
Magic Eden, a Solana-based nonfungible token (NFT) marketplace, has become the latest platform to release a tool that allows creators to enforce royalties on their collections.
It follows the announcement of a similar tool by rival NFT marketplace OpenSea in early November.
According to a Dec. 1 statement, the open-source royalty enforcement tool is built on top of Solana’s SPL token standard and is called the Open Creator Protocol (OCP). This will allow royalty enforcement for new collections that choose to follow the standard starting December 2nd.
Lu previously floated the idea of NFTs designed to enforce royalties at Solana’s Breakpoint 2022 conference on Nov. 5, citing the need for NFT creators to have a “sustainable revenue model.”
Creators using OCP will also be able to ban marketplaces that have not enforced royalties on their collections. Magic Eden will continue to maintain optional royalties on its platform for collections that do not adopt OCP.
2/ Solana’s community has been waiting for a resolution on royalties.
When we went to elective royalties in mid-October, we said we hoped to soon return to a world of respect for royalty. However, royalties needed protocol-level protection to be truly defensible.
— Magic Eden (@MagicEden) 1 December 2022
In a Twitter thread on December 1, Magic Eden said it “cannot apply OCP retroactively to existing collections,” and told creators that they must perform “burning.” [and] re-mints” where the NFTs are sent to an unrecoverable wallet address and reissued by the collection.
“We have been in active conversations with multiple ecosystem partners to identify solutions for creators in a timely manner,” Lu said in the statement. He added that the marketplace’s intention with OCP was to “immediately support royalties” for new collections while coordinating with other partners for more solutions.
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An additional feature of the protocol highlighted by Magic Eden is the ability for creators to introduce dynamic royalties – which can reduce the value of royalties to buyers who pay higher prices – and customizable token transferability which could, for example, see NFTs limited to a number of trades or be subject to a trading halt for a specified period of time.
Magic Eden moved to an optional royalty model in October that gave buyers the option to set the royalties they want to contribute to projects, which divides opinion in Twitter’s NFT community.
The OCP tool follows a similar chain tool launched in early November by OpenSea that restricted NFT sales to only marketplaces that enforce royalties.
Magic Eden created a similar royalty enforcement tool, MetaShield, in partnership with peer marketplace and aggregator Coral Cube in September before switching to optional royalties.
