Clear DefinitionsNFT Royalties Registry
1 min read
Pronunciation
[en-ef-tee roi-uhl-teez rej-i-stree]
Analogy
An NFT royalties registry is like a global musician's rights database for digital art. When an NFT is resold (like a song being played), the database tells marketplaces (radio stations) who the original creator (musician) is and how much of a royalty cut they should receive from the sale price.
Definition
Key Points Intro
An NFT royalties registry aims to standardize how creator royalties are declared and honored across different NFT marketplaces.
Key Points
Allows creators to set royalty percentages and payout addresses for their NFTs.
Aims to provide a common standard for marketplaces to query and enforce royalties.
Can be implemented as a smart contract or a defined interface (e.g., EIP-2981).
Facilitates automated royalty payments to creators upon secondary sales.
Example
An artist mints an NFT and registers it with a royalties registry (or implements a standard like EIP-2981), specifying a 10% royalty to be paid to their wallet address. When this NFT is sold on a participating marketplace for 1 ETH, the marketplace consults the registry/standard and automatically sends 0.1 ETH to the artist.
Technical Deep Dive
EIP-2981 is a common standard for NFT royalty information. It defines a `royaltyInfo` function in the NFT's smart contract that marketplaces can call to retrieve the royalty amount and recipient for a given sale price. Other registry solutions might involve a central smart contract where creators can register royalty information for their collections. The effectiveness relies on marketplaces integrating and honoring these standards or registries. Some solutions also explore more complex split royalties or dynamic royalty structures.
Security Warning
While the registry or standard can declare royalties, enforcement often relies on the voluntary compliance of NFT marketplaces. Not all marketplaces may support or fully honor on-chain royalty specifications. Creators should research marketplace policies.
Caveat
The enforcement of NFT royalties is a complex issue. On-chain standards improve clarity, but widespread adoption and consistent implementation by all marketplaces are necessary for universal effectiveness. There are ongoing debates about the enforceability of creator royalties.
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