Investor Mark Cuban, involved with OpenSea, expressed dissatisfaction with their decision. Creators are considering leaving and imposing restrictions due to this move.
Mark Cuban and the creator of Bored Ape Yacht Club, Yuga Labs, were among the important people who spoke out against NFT trading platform OpenSea on Friday. This was in response to OpenSea’s announcement on Thursday that they will no longer make sure creators get paid when their NFTs are resold.
Mark Cuban, a very rich person in the tech world, said on Twitter that it’s a big mistake for OpenSea to not pay royalties on NFT sales. He thinks it makes people trust the platform less and harms the whole industry.
OpenSea said they won’t make buyers pay a fee to creators when they sell NFTs starting from August 31. This change affects artists who make money when their work is sold again after the first time. Normally, this fee is around 2.5% to 10% of the sale price.
Cuban’s words matter in the NFT world because he’s a well-known figure and has been involved in cryptocurrencies for a long time. It’s interesting that he’s also an investor in OpenSea, having put money in during their $23 million funding round in 2021. OpenSea is valued at $13.3 billion now.
OpenSea had been talking about this change for a while, and they finally said they won’t make sure creators get royalties on resales anymore. Usually, creators get a fee when NFTs are sold again, and this fee is often between 2.5% and 10% of the sale price.
https://twitter.com/mcuban/status/1692541974484549925?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1692541974484549925%7Ctwgr%5E84615468cdb0c892bc8000158a89defe9d550ecc%7Ctwcon%5Es1_&ref_url=https%3A%2F%2Fdecrypt.co%2F153043%2Fmark-cuban-yuga-labs-lead-backlash-over-opensea-nft-royalties-change
Many people saw OpenSea’s decision as a response to pressure from other NFT marketplaces. These other platforms have also reduced the fees that creators receive, hoping to attract more buyers. OpenSea’s CEO and co-founder, Devin Finzer, used to strongly support the idea that creators should get paid, but this decision goes against that.
Several well-known NFT projects’ creators, including Yuga Labs, criticized OpenSea’s choice on Friday. Yuga Labs is even planning to slowly stop working with OpenSea because of this new policy.
A person who speaks for Yuga Labs said to Decrypt that this decision means, by February 2024, they won’t let OpenSea trade new Yuga projects and any projects with smart contracts that can be upgraded. Until now, NFTs made by Yuga Labs have been sold for more than $9 billion in total, according to data from CryptoSlam.
On @opensea's decision to sunset their Operator Filter. pic.twitter.com/ahc155WWkX
— Yuga Labs (@yugalabs) August 18, 2023
Another creator, Betty, who is behind the NFT project Deadfellaz, asked for all creators in the industry to stop working with OpenSea. She criticized the company for not helping artists, especially those who aren’t represented well, by going against the idea of decentralization and sharing profits.
Betty shared on Twitter that new artists won’t get the same advantages that big brands and artists had before. She believes that creativity will slow down, and more artists will have to rely on investment money. She has said this before, but she thinks artists who are often ignored will be hurt by this decision.
So are we boycotting @opensea then? If it doesn’t align with the incentives of creators, creators should move their business to places that do.
— BETTY (@betty_nft) August 18, 2023
On Friday, smaller platforms like Rarible emphasized their strong support for giving royalties to creators. Meanwhile, some people on Twitter worried that OpenSea’s choice might mean the end of this practice in the whole industry. OpenSea was the biggest NFT trading platform that still followed this policy.
In response, digital artist Fvckrender expressed hope in people coming together: “If we stop using OpenSea, both us and them will face problems.”
Royalties are dead. Now what?
— ThankYouX (@ThankYouX) August 18, 2023
Important:Â Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
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