There’s no saga in NFTs quite like the battle over royalties, the fees earned by a project’s creator when the digital assets change hands.
In the latest chapter, Blur, the second-largest NFT marketplace by volume, seems to have figured out a way to bypass a blacklist from OpenSea, the leading NFT marketplace.
OpenSea launched an Operator Filter Registry last November, which forced creators of new NFT collections to make a decision — they could either use the tool, which blocked their tokens from being traded on marketplaces that didn’t enforce royalties, or else Opensea wouldn’t enforce royalties for the collection on its own marketplace.
As the vast majority of NFT trading is conducted on OpenSea, it’s a tough choice for creators. But by using the tool, artists lose out on the added exposure on marketplaces like LooksRare, SudoSwap, and Blur, all of which don’t enforce royalties.
In a bit of business judo, and in order to provide access to NFTs that had blacklisted the marketplace because of OpenSea’s ultimatum, Blur has reportedly integrated a free-to-use marketplace protocol called Seaport, which OpenSea itself launched last year.
Using Seaport allows Blur users to list NFTs that have implemented OpenSea’s filters. Crucially, however, NFTs listed on Blur using the Seaport protocol include mandatory royalty fees.
Panda Jackson, the pseudonymous analyst who brought attention to the development, sees it as a good move for almost all parties in the short term, but told The Defiant that Blur’s move has also opened up a way for a new NFT marketplace to make inroads in the space.
Blur’s use of Seaport means that creators will see royalties enforced on both Blur and Opensea. Blur will get the additional volume. Traders will be able to newly access NFTs on Blur, which, unlike OpenSea, doesn’t charge trading fees.
And while OpenSea loses out on some trading fees, it acquires a major user of Seaport, which Panda believes the firm may be able to monetize in the future.
The wider enforcement of royalties may also attract more creators to the space, which would help both Blur and OpenSea.
Blur and OpenSea are yet to respond to The Defiant’s requests for comment.
It’s a brutal time all around for NFT marketplaces.
Magic Eden, originally launched on the Solana blockchain, has deployed on Polygon to try and stoke its business. NFT volumes filtered for wash trading are down roughly four-fifths from their early 2022 highs, according to a Dune query.
If Blur and OpenSea reach an equilibrium of sorts, it could be a step toward resolving one of the most divisive issues in the NFT space.
Focus on Trading
Blur has always been geared toward traders. Instead of featuring NFT projects on its site like OpenSea, Blur emphasizes its speed. “Execute trades faster and make more money on Blur,” reads the marketplace’s homepage.
Blur seemingly came out of nowhere in October to become a massive player in the competition between NFT marketplaces as traders vied to maximize their BLUR airdrops — according to a Dune query, it accounted for over half the total NFT trading volume during a week in December.
Blur may have hinted at its implementation of Seaport when it said, “we’re trying new things” in a tweet announcing a delay of the BLUR airdrop to Feb. 14