Are NFT Royalties Sustainable for Creators in the Long Run?
The NFT boom has introduced a revolutionary way for digital artists, musicians, and creators to monetize their work. One of the biggest promises of NFTs was royalties—automatic payments every time a piece is resold. On the surface, this model seems like a dream come true. Imagine earning not just from your first sale, but also from every future resale. But as the NFT market matures, many are asking: Are NFT royalties truly sustainable in the long run?
The Promise of NFT Royalties
Traditionally, artists only earn once when selling their work. If the buyer later resells it at a higher price, the creator doesn’t see a cent. NFTs changed that dynamic by embedding royalty agreements directly into the smart contract. A creator could earn, for example, 5–10% of every resale, giving them a continuous revenue stream.
This system looked like a win-win: collectors could support artists, and creators had ongoing income potential.
The Reality: Market Pushback
However, as the NFT industry has evolved, some marketplaces started removing or making royalties optional to attract more traders. For high-volume buyers and flippers, avoiding royalties means higher profits. Unfortunately, this comes at the expense of the creators who rely on those recurring payments.
Some platforms, like Blur and OpenSea, even faced community debates over whether royalties should be enforced or voluntary. The result? Many creators are now seeing shrinking royalty payments.
Sustainability Challenges
Market Competition
Marketplaces that reduce royalties attract more traders, forcing others to follow.
Enforceability
Smart contracts can be bypassed, especially if NFTs are traded off-chain or on royalty-free platforms.
Economic Pressure
In bear markets, traders push back against extra fees, making royalties harder to sustain.
Possible Solutions
Creator-Owned Marketplaces
Platforms controlled by artists themselves could enforce fair royalty systems.
Community Support
Educating buyers about why royalties matter may encourage them to trade on royalty-respecting platforms.
Hybrid Models
Some suggest upfront higher prices with lower or no royalties to balance sustainability.
Final Thoughts
NFT royalties remain one of the most promising innovations for creators, but their long-term sustainability is far from guaranteed. For now, the model is under pressure, and the future may require new standards, community-driven platforms, or even regulatory support to ensure creators don’t lose this powerful source of income.