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Creator royalties, or a lack thereof, on NFT marketplaces have been the niche's biggest talking point of late.
For SuperRare though, the decision to pay creators was already made five years ago.
According to the project's co-founder and CTO Jonathan Perkins, when SuperRare launched in 2018, the royalty aspect was going to be a "standard."
"What I think we’re seeing pan out now is just the kind of chaos of a new market taking shape," @SuperRare cofounder @rareperkins told us at @nft_paris about the creator royalties debate. "Royalties are not going away on SuperRare." pic.twitter.com/WoFq3CJKn4
— Decrypt (@decryptmedia) February 27, 2023
“We took a fairly controversial move at the time to include artist royalties. What we said is that if we can help artists make any money through royalties, why not try at least? So we played some part in establishing some kind of a standard, at least for the art side,” told Decrypt during the NFT Paris conference. "Royalties are not going away on SuperRare.”
Creator royalties are fees ranging up to 10% of an NFT sale that's paid to creators. For projects that generate significant trading volume, these fees can be a substantial source of revenue.
OpenSea’s controversial move to change its creator royalty and fee structure earlier this month has raised serious questions about what the value proposition of NFT marketplaces will be if artists and the original creators are cut off revenue streams. Now, buyers on the marketplace are free to decide whether or not they want to honor creators’ royalty preferences on the world’s leading NFT marketplace.
The decision followed the news that rival marketplace Blur, which previously offered a 0.5% minimum creator royalty, is enforcing full creator royalties for any collection that blocks trading on OpenSea, marking a fresh round of standoff between the two companies.
“What I think we're seeing pan out now is just the kind of chaos of a new market taking shape,” Perkins, adding that the wider NFT market isn't just about pictures of monkeys and penguins.
“If you think of it in terms of Blur versus OpenSea, at OpenSea there’s surely an art, but there are also domain names, insurance contracts, collectibles, and many other things that are not art,” he said.
More than a quick buck
He also believes that challenges facing more generalized marketplaces are much different than for SuperRare—a social network for art creators and collectors of NFTs—as “collectors on SuperRare are generally not doing high-frequency trading or trying to make a quick buck.”
“We've spent five years building a community where collectors are really building connections with the artists, and there's more goodwill and long-term view and that tends to make it much easier to have consensus around preserving royalties," said Perkins.
As for the recent trend of big companies and brands rushing into the NFT space, Perkins said this is quite natural as there’s “so much surface area,” and big brands are certainly aware of a new customer base and a new creator economy emerging.
“I think it's actually a good thing for Web3 that these brands are coming in and experimenting,” said Perkins. “If I were to give any advice to any companies like this I would say ‘show up without an agenda and try to learn, try to talk to people, learn from the artist.’ I think it's possible to do things in a very authentic way.”
The wrong approach, he said, would be to try to kind of rubber stamp your former approach and try to come in and do something “that's more of gimmicky or low effort.”
“I think the community has a good bullshit detector overall,” said Perkins, adding that for the really savvy collectors with big money, it becomes apparent over time.