NFT Marketplace OpenSea Makes A ‘Huge Mistake’ With The New Royalty System

Mark Cuban, a billionaire investor in OpenSea, a popular non-fungible token (NFT) marketplace, has criticized the platform’s decision to disable its royalty system.

OpenSea’s CEO, Devin Finzer, announced that while creators will still be able to charge fees, the platform will no longer enforce them unilaterally.

Finzer said that this change would better reflect the principles of choice and ownership in the OpenSea ecosystem. Cuban, however, disagrees and believes that this new policy will harm both the industry and the NFT platform itself. He expressed his concerns in a recent thread.

“Not collecting and paying royalties on NFT sales is a HUGE mistake by OpenSea. It diminished trust in the platform and hurts the industry. And I say this as an OpenSea investor…

The buyer knows what the royalties are before they buy it. The creator can set the royalty to zero. They are part of the smart contract that mints the NFT. It’s not smart. It’s desperation.”

The business magnate proposes a solution for content creators and OpenSea to receive payment. He suggests that NFT transactions should be free if they pay a royalty, but OpenSea should take a percentage of the royalty as a fee.

This way, the creators still receive most of the royalty, while OpenSea earns a profit that is likely higher than the transaction fee. Cuban supports the idea of royalties because they allow creators to continue earning money even if their products are sold on secondary markets.

He believes that this creates opportunities for creators to earn royalties on future sales.

By turning textbooks into NFTs with built-in DRM and a reader, the prices of textbooks will drop significantly.

There are all kinds of optimistic predictions about the price of digital assets these days, so make sure to check out the markets.