Quick take:
- The Bored Ape Yacht Club creator has faulted OpenSea’s decision to remove royalty fees on existing collections.
- The company is promising a creator royalty fee model that ensures transferring NFTs between wallets remains free.
- The proposal was created by Yuga Labs co-founder GordonGoner (Wylie Aronow) and co-signed by the other co-founders.
Yuga Labs has joined in the creator royalty fee debate with a new proposal that seeks to keep NFT transfers between wallets free whilst keeping creators motivated within the ecosystem.
Yuga Labs launched its first NFT collection the Bored Ape Yacht Club early last year following the success of Ava Labs’ Cryptopunks. Yuga was co-founded by GordonGoner (Wylie Aronow), Greg Solano and Kerem Atalay in February 2021.
The project has since grown to become the largest in the NFT space in terms of the value of collections owned. The company acquired the Cryptopunks and Meebits NFT collections from Ava Labs in March 2022, adding to its already popular NFT collections BAYC, Mutant Ape Yacht Club and Bored Ape Kennel Club.
It has since gone on to launch the Otherside metaverse, the home of the Otherdeeds NFT collection.
These holdings make Yuga one of the biggest NFT creators, thus making it an important player in the creator royalty fee debate.
In his argument, GordonGoner pointed to the fact OpenSea takes 2.5% off the top of what NFT traders are paying for their NFTs as one reason that creators too should claim a share of secondary sales.
“The end result has been that OpenSea has made around $35 million dollars from Bored Ape sales on its platform, not including any of our other collections. We’ve never met the founders but perhaps they have a beach house somewhere with a plaque for us,” Aronow wrote in a document co-signed by Yuga Labs co-founders.
The post is Yuga’s response to OpenSea for tentatively choosing to follow other NFT collections on creator royalty enforcement. Although OpenSea said it will be handing power to the creators to determine whether or not traders should pay royalty fees, the enforcement tool announced on November 6 only covers new NFT collections.
This implies that OpenSea is essentially removing royalty fees on existing collections like Yuga’s blue chip NFTs, BAYC, Cryptopunks, Meebits and MAYC.
In the new proposal created during a consultative meeting between Yuga Labs cofounders and Randy Chung (Melonpan) of 10KTF, the creators agreed that wallet-to-wallet transfers should be free.
According to the proposal, Yuga wants to still maintain incentives for creators even with free wallet-to-wallet transfers that traders could exploit via over-the-counter transactions.
Aronow and co propose creating “an allowlist that allows trading between normal wallets (also known as externally owned accounts or EOAs) and specifically allows NFT marketplaces that respect royalties.”
The new concept would allow transaction requests made using regular wallets to execute while performing a secondary check on transaction requests made using smart contracts. If a match is found, then the transaction is allowed, wrote Yuga Labs in an explanation about how the “Allow List” would work.
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